BC Election 2017: The irony is rich when it comes to Clarks concern over BC’s credit rating.
That face-palm kind of moment when Premier Christy Clark and the BC Liberals use the threat of losing the provinces Triple AAA credit rating to attack the NDP…
…just months after the Liberals were warned twice in a year, that escalating BC Hydro debt threatens the provinces Triple AAA credit rating… ( But hey, the premier doesn’t want to talk about that now, does she?)
VICTORIA — Amid an otherwise favourable credit report on British Columbia last week, the Moody’s Investors Service sounded an alarm about a 125-per-cent increase in debt at government-owned BC Hydro.
“BC Hydro’s total reported debt has risen considerably since 2008, increasing from $8.1 billion as of March 31, 2008 to an estimated $18.1 billion as of March 31, 2016,” wrote Moody’s.
Nor is that the end of the rising tide of red ink, the debt-rating agency went on to note in the report dated April 7.
Hydro’s debt load “is expected to continue to rise over the medium-term as the utility moves forward on the construction of an $8.8 billion hydroelectric dam at Site C.”
The current projection is for Hydro to add a further $4 billion in debt over the next three years to cover some of the capital cost on Site C as well as upgrades of the existing network of generating stations and transmissions lines.
All cause for concern, according to Moody’s, because Hydro’s financial metrics — the measures of its ability to go on servicing its own debt — “are among the weakest of Canadian provincial utilities.”
But wait…. there is more.
VICTORIA — A top investment firm continues to sound alarm bells about B.C. Hydro‘s finances, saying the Crown electricity provider’s rising debt level is a risk to B.C.’s credit rating….
…projects like Site C are pushing up B.C. Hydro’s debt levels, and adding to concerns about the province’s overall “high debt burden” compared to its peers, Moody’s also wrote in its credit opinion.
B.C. Hydro’s debt has increased from $8.1 billion in 2008 to a projected $18.1 billion last year, and there is a further $20 billion expected in the future for infrastructure projects, a $2-billion annual upgrade program and the Site C dam.
“The anticipated increase in debt continues to pressure the province’s rating since it raises the contingent liability of British Columbia,” wrote Moody’s, which has expressed similar concerns the past three years. Hydro’s debt is ultimately backstopped by taxpayers if the situation worsens, noted Moody’s.
Hydro does have the flexibility to raise electricity rates to pay its debts, but its finances are nonetheless “among the weakest of Canadian provincial utilities,” added Moody’s.
Finance Minister Mike de Jong said Moody’s is “appropriately mindful” of Hydro’s big projects and their impact on the province.
Fast forward to…
After ignoring the very real and continuing threat to our provincial Triple AAA credit rating thanks to escalating BC Hydro debt…This from CKNW, today:
Eliminating tolls on Port Mann, Golden Ears bridges will threaten B.C.’s credit rating
It’s a warning from the BC Liberals: “They’re going to have to find the money somewhere. Our plan is one that means we are reducing costs affordably. It’s a responsible plan, it’s costed, and its not going to mean anyone’s taxes are going to go up because we know we can afford it.”
Leader Christy Clark says not only is the BC NDP plan to get rid of tolls expensive and irresponsible, but her party claims there are hidden costs the NDP is not talking about.
Specifically, the BC Liberals say eliminating tolls would threaten B.C.’s AAA credit rating.
Sooo… let me make sure I have this right.
Forcing BC Hydro to borrow money to pay your government dividends has been acceptable to you.
Vowing to get a $9billion+ project past the point of no return made sense to you.
And escalating debt at BC Hydro threatens our Triple AAA credit rating to the point you’ve been warned for three years and have done nothing but help make it bigger..
And now the sky is falling?
( For the record, I am not a fan of toll removal & think it makes much more sense for Metro Vancouver traffic flow, congestion & future infrastructure planning to move to a minimal toll on each crossing. But that’s something we can chat about later)