Profit drops at Canadian power supplier BC Hydro

- VANCOUVER, British Columbia - Provincially-owned BC Hydro, a major supplier of electricity to the western United States, said on Thursday its profits have dropped sharply on lower rates and higher energy costs. The utility said that as of Sept. 30, the halfway point of its 2002 fiscal year, it had net income of C$164 million ($102 million). That was down from C$343 million in the same period last year although its gross revenues increased by C$903 million to C$4.2 billion.

BC Hydro said it has lowered its forecast for net income for the full fiscal year to C$200 million from C$375 million, in part because of export electricity prices averaging US$25 per kw compared with US$125 per kw last year.

The Canadian utility blamed higher energy costs during the early part of the six-month period for increasing its expenses to C$3.8 billion, C$1.7 billion higher than in the first half of the last fiscal year.

BC Hydro said it has taken advantage of recent drops in energy prices to purchase wholesale power for resale, allowing it to replenish water reservoirs in its massive hydro-electric system, which have been depleted lower-than-expected snowfall.

BC Hydro is a major source of revenue for the British Columbia provincial government, which cited the utility's lower revenue projections as one reason it was increasing its projected budget deficit for the fiscal year to C$3.4 billion.

($1=$1.60 Canadian)