B.C. Energy Minister Bill Bennett said Wednesday he will consider the use of natural gas to produce cheaper power in response to prospective massive BC Hydro rate increases.

Confidential BC Hydro documents show electricity rates could increase as much as 26 per cent from 2014 to 2016 to meet cost increases of $1 billion.

Industrial electricity users represented by the Association of Major Power Customers of B.C. warn the rate increases could stymie business development. The group argued Wednesday the B.C. government must reconsider using natural gas to produce cheaper power in place of hydro or independent power projects such as run-of-the-river.

The use of gas-fired power was pushed aside in British Columbia in 2007 as part of a new green energy plan brought in under then-premier Gordon Campbell.

However, Premier Christy Clark gave the green light to natural-gas fired power last year for proposed liquefied natural gas projects, declaring it clean if it was used for that specific purpose.

Bennett said current legislation — which stipulates that 93 per cent of B.C.’s electricity must come from clean energy that doesn’t produce greenhouse gas emissions — restricts him from acting on gas-fired power now.

But in an interview, he said he has an obligation to look at everything to keep rates down over the long haul.

“I’m doing something that cabinet ministers don’t normally do, which is to speculate,” said Bennett. “But I think the people who have an interest on both sides of the issue — those concerned about carbon emissions and those worried about staying in businesses employing thousands of people in these industries — I want both of them to know I am thinking about (gas-fired power).”

Bennett said a decision on gas-fired power is not needed immediately, as BC Hydro’s recent long-range plan shows new power generation is not needed for a few years.

Both the premier and Bennett have said the rate increases will not be as high as 26 per cent from 2014 to 2016, but have not put a number to the increases. A rate review is underway involving senior officials from the energy and finance ministries and BC Hydro.

But the pressure on rates continues into the next decade.

Rates are forecast to increase another 8.4 per cent in 2017, and cumulative increases are forecast to reach 41.5 per cent by 2020, according to the internal BC Hydro document from the Rates Working Group dated Aug. 23, 2013.

“When the bill comes in this big, I think it has to reopen that discussion (on gas-fired power),” said Richard Stout, executive director of the Association of Major Power Customers of B.C.

The group represents industrial users in the pulp, wood, mining, and petrochemical sectors, which consume 20 per cent of B.C.’s electricity.

Stout said the Site-C hydroelectric project in northeastern B.C. should be scrapped in favour of gas-fired power, arguing that gas is a clean energy compared to coal.

Natural gas is helping to drive down emissions globally, replacing coal, and is in favour in Europe, noted Stout.