Provincial regulators announced a decision on how much ferry fares could be allowed to rise over the next four years — potentially as much as 9.2 per cent each year — while BC Ferries’ president rushed to assure customers prices were unlikely to go up that much.
A preliminary decision by the B.C. Ferry Commission set a price cap for BC Ferries to raise its average fares annually from April 1, 2024 to March 31, 2028. A final decision will be confirmed on Sept. 30 of this year, according to commissioner Eva Hage.
“Facing labour difficulties and high inflation, BC Ferries is emerging from the current performance term (PT5) in less-robust financial shape than initially expected,” said Hage. “And the next four years (PT6) will bring significant additional challenges.”
The proposed maximum increase marks a sharp departure from the PT5 and PT4 price caps of 2.3 and 1.9 per cent, respectively. Hage said the higher price cap is contingent, however, on BC Ferries identifying $10 million in operating cost savings over the four-year term. Additionally, the commissioner said regulators have reduced BC Ferries’ proposed capital plan – the largest in the corporation’s history – by $330 million.
“Continued labour supply issues, rising fuel prices, escalating costs associated with maintaining an aging fleet, and a 12-year, $5.2-billion proposed capital plan driven by a need to replace vessels will create substantial pressure,” said Hage. “Given this, we believe that a price cap of 9.2 per cent is appropriate and necessary to allow BC Ferries to meet the demands of the upcoming performance term.”
Under the maximum allowable increase, a one-way fare for two adults in a vehicle for a Canada Day sailing from Tsawwassen to Long Harbour could rise from $114 to $162 four years from now. But BC Ferries president and CEO Nicolas Jimenez was quick to note the commissioner’s preliminary decision does not take into account the provincial government’s recently-announced $500 million in new funding, as the details as to how this funding will be applied have not yet been determined.
“I want to assure our customers, employees and partners that ferry fares will not be going up 9.2 per cent per year for the next four years,” said Jimenez. “What the commission has signaled today is not a final outcome but rather one step in a much longer process that is ongoing and won’t culminate until September when a final price cap will be set by that independent office.”
“Certainly the $500 million will help alleviate a significant amount of the pressure facing our ferry system,” said Hage, “and allow us to lower the final price cap accordingly.”