LETTER NO. L-53-95 SIXTH FLOOR. 900 HOWE STREET. SOX Z' VANCOUVER. S.C. CANADA V6Z 2N3 TELEPHONE: (604) 660-4700 ROBERT J. PELLATT BC TOLL FREE: 1-800-663-1365 COMMISSION SECRETARY FACSIMILE: (604) 660-1102 October 31, 1995 Rodger & Gloria Lutz 269 Don Ore Drive Salt Spring Island. B.c. V8K 2H5 Dear Mr. & Mrs. Lutz: Re: British Columbia Hydro and Power Authority Customer Complaint - Electricity Rates - Bed & Breakfast Establishments With reference to your July 1995 complaint regarding the general service rates charged to your Cranberry Ridge Bed & Breakfast ("B&B") establishment, the Commission has now had an opportunity to review the evidence presented, including B.C. Hydro's August 24, 1995 response and your comments provided on September 6, 1995. The Commission has also reviewed two other complaints from Quail's Nest B&B and the Whistler B&B Association as well as B.C. Hydro's October 19, 1995 response to Quail's Nest (attached) and provides the following comments. The decision by S.c. Hydro to apply general service rates to B&B establishments that have three or more rooms set aside for commercial activities is based on a Customer Service Instruction that is applied throughout its service territory, on similar requirements contained in the provincial Municipal Act and is followed by municipalities that require business licenses for B&B establishments that operate within residential premises. The Commission acknowledges that the design of residential/commercial rates is a difficult one to administer, but the Commission is satisfied that B.C. Hydro is generally doing a good job of applying it's policy in an unbiased and fair manner. The Commission encourages B.C. Hydro to remain sensitive to customer interests as it determines individual cases. In all cases where commercial rates are applied, the customer has the option to segregate the wiring and separately meter the residential and commercial consumption.
2 Therefore. the Commission has ruled in favor of B.C. Hydro in the administration of its Tariffs as they apply to the B&B establishments and supports their application of the Electric Tariff and Customer Services Instruction. Yours truly, tli~ RJPllm Attach. cc: Mr. David Harrison Senior Vice President and Chief Financial Officer British Columbia Hydro and Power Authority Quail's Nest Bed & Breakfast Whistler Bed & Breakfast Association Honourable Bill Barlee, Minister of Tourism Honourable Glen Clark, Minister of Employment & Investment CO\IPL\I\:TS.'BCII-Cor/Rmcs B&B - Lutz
9 '95 :5:53 FROM TO ECUC BChydro mproud of our Sc:rVlct: Dayid A.. Harrison Senior Vice-Presidem Corporate & Financial Affairs. and Chief Financial Officer 19 October 1995 Mr. R.I. PelIatt Commission Secretary British Colwnbia Utilities Commission 8 C UTILITIES COMMISSION \ P.O. Box 250 RECEIVED & ACKNOWLEDGED II 600 - 900 Howe Street Vancouver, B.C. OCT20 1995 V6Z 2N3 _~FOA SIMt= kt.YI ..... , ..'".:l~ONSE \ ::::~ ~~:o~~~O~:~~L~~~~.................. . Dear Mr. Pellan: Re: British Columbia Hydro and Power Authority Customer Complaint: Vivian Cline Quail's Nest Bed & Breakfast This letter is in reply to your letter of 25 September 1995 asking for comments on the complaint registered by Vivian Cline. In framing our comments, we have responded directly to each of the 4 points in Vivian Cline' s letter. • The key factors in applying rates is the nature of the usage - residential or commercial activity. The issues is not one of consumption pattern. B.C. Hydro has different rates for residential and commercial usage of electticicy (with residential rates being lower than commercial ones). The issue of fairness is raised where a person decides to operate a business from a residence if this person receives a preferential rate with respect to a competitor who does not operate'trom his residence. In such circumstances, B.C. Hydro transfers the account to the general rate although the customer always has the option [0 segregate the wiring and provide for the installation of tvlO meters - one for residential and one for business purposes. • B.C. Hydro's position is that the requirement to have a business license is a good indication of a commercial venmre. The application- of the general rate based upon three rooms is consistent with the provincial Municipal Act which restricts municipalities from requiring a business license when not more than two rooms are available for letting or renting. It is also consistent with the treattnent afforded to such operations by some municipalities. For example, the City of Victoria requires a busmess license for bed and breakfast operations
OCT 19 '95 15:54 FROM TO ECUC with three or more rooms to rem. As was memioned above. customers do have the option to segregate the wiring and be metered. separately for residential and commercial usage. However. in most cases wberea customer operates a business from a horne. it is impractical to meter the business use separately. The account is billed on either Rate Schedule 1101 or Rate Schedule 1220 under B.C. Hydro's present policy. • The electric tariff states that the General Rate applies if a portion of a single family dwelling is used to carry on business and the residential rate applies if a single-family dwelling is used only as a dwelling. B.C. Hydro's policy is that when a residence is being used for a business. it will be put on a commercial rate if the commercial use is contributing significantly to the energy consumption on the premises. This determination is based upon the number of rooms available for renting as outlined in the second point above. In this matter the Quail's Nest Bed & Breakfast is on Rate Scbedule 1101. • B.C. Hydro does strive to provide customers with rar.e schedules which effectively contribute to the economy. Our decision and application of rates do evolve over time as conditions change. We are working to flatten rateS which should provide less of a difference between residential and general rates in the future. I hope our comments will assist in resolving this complain!. If we can provide any further assistance. please do not hesitate to call. Yours tru1~ 1 David A. Hi~;o Senior Vice Corporate and CbiefF c: Gail Sexsmith Ken Webb
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.