The B.C. government is slashing the cost of connecting new homes to BC Hydro by spreading those costs across more customers and increasing the utility’s contribution to infrastructure upgrades. The move is meant to support residential development and ease the financial burden on builders and homeowners.
B.C. Energy Minister Adrian Dix said in a Tuesday release that “the cost of a simple connection to a new single-family home has dropped by more than 90 per cent, from over $800, and can now be as low as $64.”
Specifically, BC Hydro’s “distribution extension policy” has been updated for the first time since 2008. This policy, which applies to new homes and businesses connected to the utility’s distribution system, previously required the first customer requesting an electricity extension to pay the full cost of system upgrades.
As of July 5, customers no longer carry the full burden when future users also benefit from upgraded infrastructure, said the ministry’s release, which added BC Hydro is also chipping in more money.
“These changes are expected to support a wide range of housing developments. Savings on a 13-unit townhouse project, for example, could be approximately $16,000 under the updated policy,” said the release.
Suraj Jhuty, co-principal of Vancouver-based Theorem Developments Ltd., reacted positively to the announcement. Jhuty’s firm specializes in multiplexes, and he attended a recent BC Hydro information session about the changes.
“I think it’s the right step in the right direction, in terms of reducing fees for our clients. But I don’t think we’re at the finish line,” he said.
Jhuty said electricity connection fees are incorporated into his company’s cost estimates but are usually borne by whoever is named on the BC Hydro account. He said a government subsidy program would be great for these owners.
“There’s just going to be a larger need for electrical load coming to our sites,” he said.
But Jhuty said Dix’s 90 per cent cost reduction figure may be optimistic.
“For us to believe it, we’ve got to see it,” he said.
Barrett Sprowson, senior vice-president of sales and marketing with Peterson Group Properties (Canada) Inc., also welcomed the policy change.
"These changes, designed to cut costs and shorten timelines, are a welcome shift," he said in a statement to BIV.
"We’re also eager to see how the updates impact multi-family developments. As cities look to densify to meet growing demand, these projects are critical."
The new government policy comes as BC Hydro, a provincial Crown corporation, sees an increasing number of connection requests, totalling more than 40,000 each year.
The ministry said requests have grown 30 per cent in recent years, mostly due to housing demand.
