Three researchers, including one from UBC, have concluded that it would be prudent to suspend construction on the Site C dam and refer it to the B.C. Utilities Commission for a review.
Karen Bakker, head of UBC's program on water governance estimate, and Richard Hendriks and Philip Raffals noted in their lengthy report that B.C. Hydro will have spent $1.87 billion on the project by June 30.
They pointed out that cancelling the dam along the Peace River would save between $500 million and $1.65 billion.
"Suspending the Site C Project is preferable to cancelling the Project by up to $350 million," they wrote. "Both cancelling and suspending are preferable to continuing with the Site C Project."
The report pegs the cost of the Site C dam at $8.3 billion, which is the figure released in 2014.
The media commonly put the price at $8.8 billion. This reflects a contingency fund and expected delays in construction that won't have the project in service until 2025.
“The business case for Site C is far weaker now than when the project was launched, to the point that the project is now uneconomic,” Bakker, Canada Research Chair in political ecology, said in a UBC news release. “The good news is that we are not past the point of no return, according to our analysis.”
According to the report, less than previously expected demand for electricity in B.C. means Site C power won't be "fully required" for a decade after the project is built.
Moreover, they say that the energy would likely be exported at prices far below the cost of production. This, in turn, could lead to higher electricity prices for residents and businesses.
“Our analysis shows that, under some of the most likely forecasts, losses from these exports will total $1 billion or more,” Bakker stated.
Even after including forecasted demand for electricity from LNG production and greater use of electric cars, there still isn't a need for Site C power into the 2030s, the researchers concluded.
Putting the project on hold rather than cancelling it could offer an opportunity to resume construction if demand and electricity prices increase to the point where Site C could be justified.
“Therefore, we recommend suspension and review by the BC Utilities Commission rather than outright cancellation,” Bakker said. “This is a nonpartisan, common sense, sober second thought analysis that indicates it’s not too late to hit pause on Site C.”
Site C becomes a campaign issue
The B.C. NDP has long favoured subjecting the Site C project to a review by the BCUC.
In an interview with the Straight earlier this week, the party's spokesperson on environment and the green economy, George Heyman, said he expects the cost of the Site C dam to soar above $9 billion.
"I think British Columbians and the BCUC need to look at how much more money is going to be dropped into this white elephant," Heyman said. "And what could we do with that money to drive rates down for British Columbians and create more jobs rather than the other way around: fewer jobs at higher rates under Site C?"
The B.C. Liberals have issued a media advisory saying that their leader, Christy Clark, will be in Surrey this morning to "highlight the economic benefits of the Site C Clean Energy Project to businesses and jobs across BC".
It will be the second consecutive day that the premier has defended the megaproject.
“Site C means thousands of jobs and 100 years of clean, affordable, and reliable power—enough for 450,000 B.C. homes,” Clark stated in a news release yesterday. “It means being ready to meet increasing demand as Canada’s leading economy continues to grow.”
The B.C. Liberals have also claimed that the project is injecting $3.2 billion into the B.C. economy, generate $40 million in regional tax revenue, and $35 million in annual water-rental payments to the provincial government.