Is the Campbell government planning another revenue grab, or it is merely looking at how to simplify regulations? Permission to use natural fresh water in BC is granted by the province with a water license. There are now over 43,000 water licenses for purposes ranging from storage for power generation to agricultural irrigation, from fish hatcheries to pulp mills, from amusement parks to hydraulic mining. The current legislation and regulations provide for approximately ninety categories of water use. The proposal is to reduce that to 9 and to adjust "water rental rates", the fee paid by a licensee to government for the use of water. The new scheme will set minimums and charge on a basis of a set fee per thousand cubic meters of water used or stored. According to the proposal, rates may increase by an average of 500% for storage by BC Hydro, 200% for pulp mills, 88% for commercial/industrial purposes and 28% for waterworks.

Most current thoughts about water have to do with rain and floods. In July 2003 the Ministry of Sustainable Resource Management issued a 27 page paper titled "Proposed Water Rental Rates" (see http://srmwww.gov.bc.ca/clrg/plab/water_rates.pdf). No news release on the topic can be found with a search on the government website, although 54 news releases were issued involving the topic of water between June and October, 2003. The paper is buried in an obscure section of the website, Corporate Land and Resource Governance, for the Ministry of Sustainable Resource Development. Management of the province's water resources is in the hands of a new crown corporation, Land and Water British Columbia Inc., which also occasionally issues news releases but did not do so on the water rate paper.

The 2003-04 budget estimates revenue for water and other resources (wildlife) as $288 million this year, rising to $295 million in 2004-05. BC Hydro's annual report says, "In addition to the Payment to the Province of $338 million, BC Hydro paid $403 million in water rentals, school taxes, grants and capital tax to provincial and municipal governments in fiscal 2003." $258 million of the $403 million was remitted to the Province by BC Hydro in accordance with the Water Act, according to a note to the financial statements. All of the $258 million isn't for water storage, the item that will increase by 500%, but the rate paper acknowledged that some licenses will have 500% increases when it said:

"The current water tariff contains two separate rental rates for storage, $0.002 per 1,000 cubic metres for licences that support the generation of electricity (waterpower) and $0.004 for the remaining water uses (non-waterpower) - such as for irrigation and domestic consumption."

"A key element of the new rent structure is to consolidate the number of different rental rates. The proposed sector rate for all storage water licences is $0.01 per 1,000 cubic metres (stored), with a sector minimum rent of $25.00. The majority of non-waterpower storage licences would receive a small rent increase from $11.00 to the sector minimum rent of $25.00. However, the most significant increase would occur for the large-volume waterpower storage licences. Rent increases for these storage licences would range from $25.00 (current rent $4.00) to $ 330,700 (current rent $64,000)."

Of course, BC Hydro has many water licenses, so the example of an increase from $64,000 to $330,700 is probably for just one of its reservoirs.

Part of the increase you will soon be paying in your electricity bill will be because the Campbell government has found another way to tax BC Hydro. How's that for tax cuts in the New Era?

Also see: Water Resource Information at http://srmwww.gov.bc.ca/wat/
BC Hydro's 2003 Annual Report is at http://www.bchydro.com/rx_files/info/info6679.pdf