British Columbia Utilities Commission Releases Draft Report On The Indigenous Utilities Regulation Inquiry

On November 1, 2019, the British Columbia Utilities Commission (the BCUC) released a draft report (the Draft Report) on its inquiry respecting the regulation of Indigenous utilities (the Inquiry). The Inquiry was instigated as a result of some recent decisions of the BCUC relating to Indigenous owned utilities that raised questions over whether they ought to be regulated differently under the Utilities Commission Act (the UCA). We have set out below some of the Draft Report's more notable recommendations for the regulation of Indigenous utilities in BC.

For background, the government issued an Order in Council in March 2019 directing the BCUC to advise on the appropriate nature and scope, if any, of the regulation of Indigenous utilities. The terms of reference for the Inquiry required that the BCUC respond to specific questions, including questions relating to the defining characteristics of Indigenous utilities and whether Indigenous utilities should be regulated under the UCA, another mechanism, or go unregulated. The BCUC requested submissions from registered interveners and interested parties and convened a series of community consultations throughout BC, which resulted in preliminary findings and recommendations based on comments and feedback from a range of Indigenous representatives, special interest groups and current utilities.

Some of the BCUC's proposed recommendations to the government include:

Regulation of Monopolies

1. That all ratepayers of Indigenous utilities receive the same protection as do ratepayers of non-Indigenous utilities.

Regulation of Mandatory Reliability Standards

2. That the BCUC retain jurisdiction with respect to approval, compliance and enforcement of Mandatory Reliability Standards applicable to all transmission infrastructure in the province, regardless of who owns or operates the infrastructure.

Reserve Lands

3. That a First Nation be given the opportunity to self-regulate when it provides utility service on its reserve land, in much the same way municipalities and regional districts do. Subject to recommendations 4 to 6 below, this can be accomplished by enabling a First Nation or Band Council to "opt out" of BCUC regulation by notifying the BCUC of its intention.
4. That the First Nation should demonstrate that it has an appropriate complaint and dispute handling process in place to protect all ratepayers. In the event it cannot do so the BCUC would retain jurisdiction to handle all complaints.
5. That the BCUC complaint and dispute handling processes be available to any ratepayer who wishes to appeal a decision out of the First Nation utility's complaint process.
6. That safety and reliability (other than Mandatory Reliability Standards) be the subject of the workshop and comment period on the Draft Report. If the Final Report recommends that the BCUC retains jurisdiction over safety and reliability, First Nations would not be able to opt out of those applicable portions of the UCA governing these issues.

Modern Treaty Lands – Nisga'a

7. That the Nisga'a Nation be given the opportunity to self-regulate as do municipalities and regional districts, when it provides utility service on its own lands.
8. That notwithstanding the Nisga'a Nation's authority over its own lands, the BCUC retains jurisdiction over Mandatory Reliability Standards, because of the interconnected nature of the North American bulk electric system.

Other Modern Treaty Lands

9. That provided a modern treaty contains terms that are substantially similar to those set out in the Nisga'a Treaty, on the basis of parity, a modern treaty First Nation be given the opportunity to self-regulate when it provides utility service on its own lands, in the same manner as proposed for the Nisga'a Nation.

Lands Subject to Historical Treaties

10. The BCUC is inclined to recommend that First Nations that are parties to historical treaties be covered by the same proposed recommendations outlined in respect of Reserve Lands.

Westbank First Nation

11. Provided that the Advisory Council Law enacted by the Westbank First Nation applies to the resolution of utility complaints, that the Westbank First Nation be given the opportunity to self-regulate when it provides utility service on its own lands, in the same manner as proposed for the Nisga'a Nation.

Sechelt Indian Band and Sechelt Indian Government District

12. The BCUC recommends that the Sechelt Indian Band and Sechelt Indian Government District be given the opportunity to self-regulate when they provide utility service on their own lands, as the BCUC has proposed for the Nisga'a Nation, provided that the Advisory Council of the Sechelt Indian Band has the power to resolve utility complaints.

Ceasing to be an Indigenous Utility

13. That if a utility ceases to meet the definition of an Indigenous utility it becomes subject to regulation under the UCA.

Definition of Indigenous Utility

14. The definition of Indigenous utility should be further explored during the workshops.

The BCUC is hosting six workshops to gather feedback and comments on the Draft Report. The BCUC is also accepting written comments on the Draft Report until March 31, 2020. The final report describing the results of consultations undertaken and its findings and recommendations must be submitted to the government no later than April 30, 2020.

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