Executive Summary: Key Legal and Evidentiary Issues

• The City of Surrey sought leave to appeal a British Columbia Utilities Commission decision ordering it to pay $41 million for transmission line reconfiguration to accommodate a planned highway extension.

• Surrey argued the Commission lacked jurisdiction under s. 32 of the Utilities Commission Act because B.C. Hydro allegedly had no pre-existing right to enter the municipal property.

• A pending trespass claim filed by Surrey against B.C. Hydro in the Supreme Court of British Columbia raised questions about whether the Commission should have declined to exercise jurisdiction.

• The panel found B.C. Hydro possessed both an inherited and a deemed Certificate of Public Convenience and Necessity (CPCN) authorizing its infrastructure on the property.

• Cost allocation became contested, with Surrey challenging the application of the "cost causation principle" that assigned 100% of reconfiguration costs to the City.

• Recent precedents in Coquitlam and Richmond established the Commission's broad authority to resolve utility-municipality disputes regarding infrastructure on municipal lands.

Background and facts of the dispute

The City of Surrey planned a highway extension along 72nd Avenue, which required reconfiguring high voltage transmission lines owned by British Columbia Hydro and Power Authority. B.C. Hydro's towers and lines needed to be raised and relocated to provide adequate overhead clearance for traffic. During preliminary discussions, B.C. Hydro informed Surrey that the necessary modifications to the transmission line infrastructure would cost between $18 million and $39 million. Negotiations broke down, prompting Surrey to file a trespass claim in the Supreme Court on 10 January 2025, alleging B.C. Hydro never had proper authority to run transmission lines across the property. B.C. Hydro filed a response to the civil claim on 31 January 2025. On 7 February 2025, B.C. Hydro filed an application with the British Columbia Utilities Commission under ss. 32 and 36 of the Utilities Commission Act, seeking an order setting the manner and terms on which its high voltage transmission facilities would continue to run across the subject property.

The Commission's decision and reasoning

The Commission panel addressed three substantive issues. First, the panel determined that B.C. Hydro had both a historically valid CPCN through its predecessor BC Electric Company and a deemed CPCN under s. 45(2) of the Act for all existing electrical infrastructure as of 11 September 1980. This established B.C. Hydro's authority to "place" its transmission facilities on the property, engaging the Commission's jurisdiction under s. 32 of the Act. Second, the panel rejected Surrey's argument that the pending Supreme Court action displaced the Commission's authority, reasoning that Surrey's trespass claim concerns a "retrospective determination" of property rights, whereas B.C. Hydro's application under s. 32 "concerns a prospective assessment on matters of public interest which invoke the [Commission]'s jurisdiction." Third, the panel evaluated the proposed transmission line relocation agreement, concluding that B.C. Hydro's draft terms were reasonable and that Surrey should bear the full cost based on the regulatory principle of cost causation, since the City's highway project necessitated the infrastructure modifications. On 22 August 2025, the panel issued an order requiring Surrey to enter into a transmission line relocation agreement as proposed by B.C. Hydro, under which the City would be responsible for 100% of the cost for transmission line reconfiguration, totaling $41 million.

Surrey's grounds for seeking leave to appeal

Surrey filed its notice of appeal on 19 September 2025 and framed its application on two primary issues: whether the panel erred in law by finding the Commission had jurisdiction and deciding to exercise it, and whether the panel erred by requiring Surrey to enter into the relocation agreement while bearing the entire cost. On jurisdiction, Surrey argued that as a matter of statutory interpretation, a deemed CPCN under s. 45(2) of the Act does not confer a right on a public utility to enter onto property, and without such a pre-existing right to enter, the public utility cannot obtain an order from the Commission specifying the manner in which its infrastructure can be altered. Surrey also contended the panel "failed to consider that B.C. Hydro was forum shopping" after having filed a response to the civil claim in the Supreme Court action.

Application of precedent from Coquitlam and Richmond decisions

The Court examined two recent decisions directly addressing the Commission's jurisdiction over utility-municipality disputes. In Coquitlam (City) v. British Columbia (Utilities Commission), 2021 BCCA 336, this Court rejected a narrow reading of s. 32 and held that the Commission was "the only authority" to decide what ought to be done with public utility infrastructure on or under municipal land, describing such decisions as "multifactorial" and going to "the core of" the Commission's jurisdiction. In City of Richmond v. British Columbia Utilities Commission, 2024 BCCA 16, the Court confirmed that when s. 32 is engaged, the Commission is granted a broad jurisdiction to "specify" the terms under which utilities will undertake work on municipal streets or in other places within a municipality, acting "in a sense, as the arbiter of particular kinds of dispute between utilities and municipalities." Both decisions emphasized that s. 121 of the Act "reflects a clear intention, where necessary, to give priority to the Commission's jurisdiction relative to municipal rights and powers."

The Court's analysis and application to Surrey's arguments

Justice Riley found Surrey's statutory interpretation arguments indistinguishable from those previously rejected in Coquitlam and Richmond. The Court determined that Surrey's argument regarding the distinction between "right to enter" and "right to place" was semantic and rested on an unjustified parsing of the panel's reasons, as the panel used these phrases synonymously and more-or-less interchangeably throughout its decision. The Court also rejected Surrey's contention that a deemed CPCN could not confer entry rights, noting that under s. 45(2), a deemed CPCN carries with it the right to operate the "plant or system" to which it relates, and under s. 46(8), a public utility that holds a CPCN is authorized to "construct, maintain, and operate" the plant or system to which the CPCN relates. The Court reasoned it would make no sense to interpret the Act to authorize the maintenance and operation of infrastructure covered by a CPCN without including the statutory authority to enter the municipal property to do so. Regarding the exercise of jurisdiction, the Court applied a deferential standard of review to the panel's discretionary decision and found no reviewable error in the panel's conclusion that declining to exercise the Commission's statutory jurisdiction would endorse a "'race to file' approach" that encourages "forum shopping."

Ruling and outcome

The application for leave to appeal was dismissed. Justice Riley concluded that none of Surrey's grounds of appeal were arguable, even under the generous merits threshold applicable to leave applications under s. 101 of the Utilities Commission Act. The Court found no realistic prospect that a division would decline to apply the reasoning in Coquitlam and Richmond simply because this case involved an electric utility rather than a gas utility. On cost allocation, the Court characterized the panel's determination as a "multifactorial assessment" within the "core" of the Commission's jurisdiction that could only be set aside on a showing of palpable and overriding error. The Commission's order requiring Surrey to enter into the transmission line relocation agreement and bear the full $41 million cost therefore stands. No exact costs amount was awarded as damages; rather, the original Commission order requiring the City to pay the full cost of the reconfiguration work remains in effect.