BC Hydro Responds to Complaint About Misleading Testimony at 2008 BCUC Hearing

In December 2015, a complaint was made to the British Columbia Utilities Commission (BCUC) alleging that BC Hydro had intentionally misled the BCUC about future plans (and associated costs) for its enterprise financial IT systems. This complaint, made by the NDP critic for BC Hydro (Adrian Dix), alleges that filings and testimony in a 2008 BCUC proceeding should have disclosed BC Hydro's decision to transition to a new and more expensive enterprise financial IT system. The complaint alleges that by the time that the case was heard, BC Hydro had changed course from its as-filed plans to upgrade its existing system rather than replace it. Based on the allegations made, the complainant asserts that BC Hydro and its management committed offences under section 106 of the BC Utilities Commission Act.

BC Hydro's President and CEO issued a prompt initial response to the complaint, indicating that BC Hydro takes the allegations very seriously, and is committed to ensuring that the highest standards of transparency are met in all of its regulatory proceedings. In this initial response, BC Hydro asserted that its final decision to move to a new enterprise financial IT system was not made until after the BCUC proceeding. However, BC Hydro acknowledged that more information should have been given during the hearing about the replacement option that was being considered and was emerging as a preferred option.

On January 8, 2016, BC Hydro filed its formal response to the complaint with the BCUC. The response has now been posted here. In the response, BC Hydro's President and CEO acknowledges that some of the testimony about the status of options being considered was misleading, and apologizes for failing to meet the standards that BC Hydro expects of itself in regulatory proceedings. However, BC Hydro maintains its position that no formal approved decision to pursue a different option had been made at the time of the BCUC proceedings, and strongly asserts that "the broad and inflammatory allegations made against [BC Hydro] are untrue." BC Hydro's response is summarized in a January 11, 2016 newspaper article.

There has not been any public statement from the BCUC about how or when it will respond to the complaint. In the event that the BCUC does not dismiss the complaint, one potential next step is to commence a prosecution alleging one or more offences under the Utilities Commission Act. Whatever next steps are chosen by the BCUC, it will be interesting to see whether the regulator addresses the question of how a utility should update its testimony and evidence as circumstances change after evidence has been filed, but before a proceeding is complete. This is an issue that arises relatively frequently given the long lead time between the filing and hearing dates for large rate applications.

*Please note that this is an updated version of an earlier post. The earlier post did not contain a link to BC Hydro's January 8, 2016 formal response to the BCUC, nor any discussion of the specific contents of that response.