Powerex started in 1988 as a small subsidiary of BC Hydro, responsible for marketing BC Hydro’s surplus electricity in western North America. Powerex was tasked with earning revenues for BC Hydro and the Province, helping to keep BC Hydro’s domestic electricity rates low.
By the mid-1990s, when the electricity trading business was fully fledged, our staff had become experts at optimizing the BC Hydro system and marketing power. When the US Energy Policy Act opened the western North American marketplace to competition, Powerex was on the leading edge of this new frontier.
In 1997, we received U.S. regulatory authorization enabling us, for the first time, to buy and sell wholesale power at market-based rates anywhere in the U.S., and deliver power directly from B.C. supply to our U.S. trade partners. By 1999, our staff had grown from about 30 people to more than 80 as we grew our customer base, market reach and product and service offerings.
Along the way, we had significantly grown our electricity trading business from Alberta through Washington to California. We became the first Canadian company to deliver power from Canada to Mexico and started marketing the Canadian Entitlement energy on behalf of the province of BC. We also began to expand our activities into gas trading, buying gas for BC Hydro’s thermal generators and trading gas in its own right. Powerex evolved from an electricity marketing company to a full-fledged energy trading and marketing company.
In Spring of 2000, rolling blackouts hit California, forcing electricity prices to extreme highs. This resulted in the bankruptcy of certain California utilities, the disbanding of the California Power Exchange, a general credit crisis across the west and the fall of a number of other market participants. At this critical time, the knowledge, experience and commitment of Powerex’ people, BC Hydro’s solid financial backing, the flexibility of the BC Hydro system and our ability to source and move power across markets enabled us to remain a key power supplier to California. In fact, the US Federal Energy Regulatory Commission staff acknowledged our role in helping to “keep the lights on” during the crisis.
The event marked a turning point in the industry. It was a “coming of age,” marked by the introduction of more complex rules and regulations and an increased emphasis on accountability for energy trading companies.
As the industry evolved, so did Powerex. Since 2002, we’ve grown our gas trading business and begun trading renewable energy products. We’ve added ancillary services to our product and service mix, and invested in significant transmission and gas transportation to maintain our leadership role in the movement of physical energy. As BC Hydro’s domestic demand for power has grown and its surplus has decreased, we have played a larger role in securing power for the province.
Today, Powerex is one of the longest-operating energy marketing and trading companies in the business, with about 160 employees serving the needs of over 450 trade partners in traditional and emerging markets throughout North America.