BCUC Sides with Marketplace in Favouring Competitive Interests of BC Businesses
over Attempted Industry Monopoly
VANCOUVER, BC – January 11th, 2013 – The BC Utilities Commission (BCUC) has sided with the BC marketplace in its decision to deny FortisBC’s request to bring installation work under regulatory control. FortisBC requested that all costs for energy, maintenance, equipment purchases and installation, corporate profit, and work completed in private and public facilities would be bundled into a long-term regulated lease. On December 27th, 2012, the BCUC made the decision to rule against FortisBC’s request.
“Fortunately the BCUC upheld its mandate and the request was denied,” says Executive Vice President of Mechanical Contractors Association of BC, Dana Taylor. “Call it a late Christmas present for consumers, but the Utilities Commission sided with the competitive marketplace as the best direction for these installations in BC. The public and private sector of the mechanical contracting industry may celebrate. Competition delivers lower prices, higher value, and a striving for innovations that would magnify both these factors.”
Had FortisBC’s request been approved, it would have created a new monopoly market, isolated from competition. In absence of competition, locked-in rates would guarantee a healthy rate of return for FortisBC. The problem, recognized by the Commission, is that FortisBC was attempting to create an island of regulation in a sea of competition distinct from any jurisdiction on the continent. A host of private businesses, many of them small family-owned operations, are already engaged in a highly competitive market here in B.C., across Canada, and globally.
In light of the BCUC decision to favour competitive interests, the commission laid out key principles that should discourage other companies from trying to create regulated monopolies in the face of robust competition.
Consumers across the economy would benefit from other regulators taking these key principles to heart:
• only regulate where required
• regulation should not impede competitive markets
• where regulation is required use the least amount of regulation needed to protect the ratepayer
• the benefits of regulation should outweigh the costs.
The BCUC’s decision provides a lesson to all regulatory agencies, a lesson that extends beyond the decision on FortisBC and heating and cooling systems. These key principles should be shared and adopted by public regulators everywhere. It is clear the marketplace best serves the needs of consumers.
About the Mechanical Contractors Association of BC
Since the early 1900's, MCABC and its predecessor organizations have been representing the interests of British Columbia's mechanical contractors and their suppliers. MCABC is the only association in BC dedicated solely to the unique interests of mechanical contractors. MCABC is here to make sure mechanical contractors and sector suppliers alike are able to provide the best possible products and services they can, to maintain and enhance their reputation for honesty, reliability and quality workmanship, to stay at the leading edge of consumer protection, and above all, to grow and prosper.
About the BC Utilities Commission
The BCUC defines itself as “an independent regulatory agency of the Provincial Government that operates under and administers the Utilities Commission Act”, and in so doing: “The Commission is responsible for ensuring that customers receive safe, reliable and non-discriminatory energy services at fair rates from the utilities it regulates, that shareholders of these utilities are afforded a reasonable opportunity to earn a fair return on their invested capital, and that the competitive interests of B.C. businesses are not frustrated.” [http://www.bcuc.com/CorpProfile.aspx]
For more information about this topic, or to schedule an interview, please contact:
Dana Taylor
Executive Vice President
Mechanical Contractors Association of BC
[email protected]
www.mcabc.org