Lack of prudent reserves forcing Hydro to raise rates

Corporation could have saved itself some money by putting away cash early

Re: Plenty of benefits to new Hydro investments (Opinion, July 19)

B.C.’s Energy Minister Bill Bennett made a most rational case for future investment in B.C. Hydro that I suggest all but the most partisan of the opposition would approve.

I agree that we must capitalize on our natural mineral resources, and to do that we need more power.

However, Bennett’s letter would have been more informative had the sentence “you can’t make investments without putting pressure on rates” been followed with the words, “because capital which should have been reserved for such investments were withdrawn in the form of dividends at the insistence of government.”

I would also suggest that had most of these dividends remained with B.C. Hydro, we would be able to offer industry a real competitive edge with substantially lower power costs – to say nothing of the financial benefits to the domestic consumer – and still operate at a profit.

Most long-term, successful private sector companies make sure that in addition to dividends, sufficient reserves are maintained for capital investment.

They are fortunate they are not blighted by interference which most often is instigated for short-term political gain.

James McMillan

Victoria