Rising cost of fuel leads BC Ferries to reduce fuel rebate

The reduction in fuel rebate will translate into customers paying more on the routes.

Rising cost of fuel leads BC Ferries to reduce fuel rebate
Photo: BC Ferries

BC Ferries is advising customers that due to current fuel market conditions and rising fuel costs, the company will reduce the fuel rebate offered to customers from 1.5 per cent to 0.5 per cent on August 1. BC Ferries closely monitors the cost of fuel and applies a rebate or surcharge, or neither, under a regulatory process that is independent of fares.

The reduction in fuel rebate will translate into customers paying 10 cents more for an adult and 30 cents more for a vehicle on the Metro Vancouver – Vancouver Island routes, and 5 cents more for an adult and 20 cents more for a vehicle on the inter-island routes.

Over the past 17 years, BC Ferries has been using a fuel rebate/surcharge mechanism to manage the volatility in the price of fuel. When fuel prices are lower, BC Ferries passes lower fuel prices on to customers through a fuel rebate. When fuel prices are higher, BC Ferries charges a fuel surcharge specifically designed to cover the additional cost of fuel only. There have also been periods with neither. The company does not benefit financially from surcharges or rebates.

Mark Collins, BC Ferries’ President and CEO, said:

“We now have five vessels operating on liquefied natural gas, a cleaner and less expensive fuel source than the ultra-low sulphur diesel we use for our other vessels. In addition, we have two hybrid electric ships in service and four more on the way. These investments help reduce ferry user exposure to volatile fuel prices.”

The new Island class vessels have a battery equipped design for full electric operation and are fitted with hybrid technology that bridges the gap until shore charging infrastructure becomes available.

Despite fuel switching and other initiatives to burn fuel more efficiently, Collins says a reduction in the fuel rebate became necessary:

“BC Ferries understands the importance of affordability of travel to our customers, and we will continue to take measures to reduce our fuel consumption further through the introduction of diesel electric battery hybrid vessels.”

The fuel rebate will be 0.5 per cent on average on all routes with the exception of the Port Hardy – Prince Rupert, Prince Rupert – Haida Gwaii and Port Hardy – Central Coast routes. These routes have a separate mechanism pertaining to the cost of fuel and the rebate will remain at 1.5 per cent until further notice.

Caring for the environment, coupled with travel affordability, are top priorities for BC Ferries. Good fuel cost management has helped hold the cost of travel flat or reduced it every year for the past four years.