A B.C. union is decrying the provincial government's call for large-scale layoffs at BC Hydro.

In a report released yesterday, a government panel recommended that BC Hydro reduce its workforce by up to 1,000 workers over the next three years, in order to shore up the Crown corporation's financial position and reduce proposed rate hikes.

But Gwenne Farrell, vice president of Utilities at COPE 378, says that workers are being punished for bad government policy. COPE 378 represents thousands of employees at BC Hydro.*

"It's a government ideology, plain and simple," says Farrell, who attributes the bulk of BC Hydro's money troubles to costly contracts with private power producers.

"Government decided that BC Hydro could no longer generate new power," Farrell says. "That has led to BC Hydro entering into energy purchase agreements with independent power producers (IPPs)."

In December of last year, The Tyee reported that the IPP contracts were playing a role in BC Hydro rate increases.

But alongside cutting jobs, the panel also recommended that "the Province and BC Hydro evaluate alternative definitions and timelines for government's self-sufficiency policy."

According to the Wilderness Committee, if the government acts upon this recommendations in particular, the very energy purchase agreements that Farrell says lie at the core of BC Hydro's financial troubles could be massively reduced or eliminated.

When BC Hydro decides how much energy capacity to build for the province's energy demands, explains Gwen Barlee, policy director for the Wilderness Committee, the Crown corporation is bound by what she calls an "insanely stupid self-sufficiency requirement…[in which] BC Hydro is forced to consider that every year is a low-water year."

In other words, when BC Hydro decides how much energy to produce or purchase in order to meet the energy needs of British Columbia, it must assume that water levels -- and therefore hydroelectric power generated by that water -- will be critically low. Alongside restrictions that block the Crown corporation from expanding its own power-generating infrastructure, this binds BC Hydro to purchase more energy contracts from private power producers around the province.

"They're on the hook for $30 billion in energy purchase agreements," says Barlee, speaking of BC Hydro's current obligations to private producers. By changing the self-sufficiency requirement, she says, BC Hydro could save billions in dollars.

Like Farrell, Barlee agrees that the main financial issue is IPP contracts, not labour.

"A lot of the big dollars are tied into the IPP contracts," says Barlee. "What they're doing now is they're going head-hunting. They're chopping jobs."

BC Hydro currently employees approximately 5,800 workers. While the ministerial report recommended 1,000 layoffs at BC Hydro, BC Hydro CEO Dave Cobb hinted yesterday that actual layoffs could be significantly lower.*