Melissa Davis: Deciphering the truth about the B.C. Energy Plan

By Melissa Davis

The B.C. Energy Plan has attracted considerable public and media attention in recent months. And no wonder. The plan affects many core values held by British Columbians: the environment, climate change, public services, and renewable energy.

With the provincial election looming, voters are challenged with the task of deciphering the truth amid communication strategies intended to generate confusion and sway votes.

An excellent illustration comes from our very own premier. While campaigning for the provincial leadership back in 2001, Gordon Campbell promised: “A BC Liberal government will not sell or privatize BC Hydro’s dams, transmission lines, water resources or other core assets” (Vancouver Sun, March 1, 2001, page A17].

To be fair, the Liberal government has not, technically speaking, privatized B.C. Hydro—much in the same way that leasing B.C. Rail for 999 years does not constitute privatization.

But shortly after assuming office in 2002, the B.C. government outsourced one-third of B.C. Hydro’s operations to Accenture, a Bermuda-based firm with ties to Enron. Next, they established the B.C. Transmission Corporation, carving out transmission  operations from B.C. Hydro so private power producers could transmit electricity throughout the North American grid. They also introduced an energy policy prohibiting our publicly owned Crown utility from developing new sources of electricity (excluding Site C, subject to the outcome of a five-year review), allocating this function exclusively to the private sector.

The B.C. Liberals argue that private power producers assume the financial risks associated with their projects. In reality, there’s not much risk involved in 20- to 40-year guaranteed electricity purchase agreements, regardless of domestic requirements, at grossly inflated rates ($80 to $125 per megawatt-hour) that far exceed market prices or B.C. Hydro’s power generation costs ($24 per megawatt-hour).

In fact, residential hydro rate increases are subsidizing private power developments—with a three percent hike implemented April 1, followed by a two-tiered rate structure applied October 1. The provincial budget proposes an additional 21 percent increase over the next three years.

Without question, the most insidious communications strategy has been the provincial government’s positioning of private power as synonymous with green energy, thereby portraying opponents of private power as anti-green.

To be clear, public power supporters are proudly “green”. We support environmental protection, conservation, and renewable energy. But we consider privately generated power to be antithetical to “green” principles.

While run-of-river power does not generate GHGs, project construction causes significant and irreparable environmental damage to forests, wildlife, and many aquatic species.

What’s more, run-of-river generates power primarily during the spring run-off, when B.C.’s dams and reservoirs are full; since the energy can’t be stored, it won’t help B.C. achieve “energy self-sufficiency” as the government claims. Rather, this power is intended for export to the U.S.

Plutonic Power’s CEO, Donald McInnes, has referred to B.C. as the “Saudi Arabia of green energy” with respect to electricity export opportunities. The question arises: does the provincial government’s vision of leadership on climate change involve the destruction of B.C.’s pristine wilderness for the purpose of powering air conditioners in California?

The government has a lot riding on its energy policy—more than $30 billion in contracts with private power companies whose contributions to the B.C. Liberal Party since 2001 total more than $800,000. But to realize their plans, they need an election win.

That’s why the party isn’t taking any chances. “AstroTurf” groups have been established in an effort to silence and discredit opposition—a PR strategy of fabricating a public interest group to publicly promote government and corporate objectives.

The most perplexing voice to emerge in this debate has been the small number of environmental activists who have aligned themselves with the government’s agenda to privatize B.C.’s electricity sector. While we share certain values, we do not view climate change as a justification for privatizing B.C.’s electricity sector. From our perspective, project-specific and cumulative environmental impacts associated with widespread, unregulated private power developments will hinder—not help—our efforts to address climate change.

Plain and simple, private companies are driven by profit—in this case, measured by energy consumption, not conservation. By contrast, Crown corporations measure their profitability through economic, social, and political objectives, including fair rate structures, conservation objectives, and green energy generation. Renewable energy solutions require public ownership and oversight, regional planning, meaningful engagement with First Nations, and adherence to strict environmental standards.

Melissa Davis is the executive director of B.C. Citizens for Public Power.




Apr 21, 2009 at 12:04am

You Public Power types keep forgetting to give the magnitude of this Pirate Power financial horror show. According to the JIESC it is 16 billion over 40 years but if spot prices stay at current levels those losses may exceed 25 billion - a fast ferry mess every year for forty years.

Gordo and gang couldn't manage a lemonade stand and are the most incompetent financial managers in Canadian history. They are utterly incapable of managing the economy in these hard times.


Apr 21, 2009 at 12:36am

Another nightmare.

Since It is obvious BCHydro is going to be losing its shirt exporting early summer run of the river power flows, in these hard economic times why don't we just dam up those rivers and have power all year round.

Wouldn't be the first time Gordo and gang had a nefarious scheme on the back burner.



Apr 21, 2009 at 4:17pm

Independent Power Producer (IPP) Run-of-the-River Technology FACTs:

Independent Power Producers pay 3 times more social benefits to government than BC Hydro does.

Private power IPPs pay $25 per MWh in taxes, water license rental fees, and community benefits to the government. About half of that is paid to the local government as property tax (while BC Hydro pays no local property taxes for 25 billion dollars of assets that it owns).

BC Hydro, on the other hand, pays only $8 per MWh as dividend and taxes to the government (2008) while most of that power is produced by dams that have permanently altered the Columbia River and Peace River basins with cumulative environmental impacts. To meet our current energy shortage, BC Hydro wants to build yet another dam (Site C) at 3 times the cost per MW, compared to low-cost low-impact private run-of-the-river technology.

A small 10 MW run of river IPP plant pays about $1,400,000 a year to various levels of government, most of it to the local government. BC Hydro pays only $420,000 for the same amount of power to the Province, including an infinitesimal “grant-in-lieu” to the local government.

No IPP run-of-the-river project is on a salmon bearing reach of a stream, and the environmental impact is minor and can be compensated. Run-of-the-river technology can co-exist and share the habitat with fish and other wildlife. IPPs do not build dams – but low weirs or taps on generally a steep stream that has little or no resident fish. The impact is far less than dams built by BC Hydro, logging, mining, oil and gas, coal, real estate development, transportation, pulp and paper, pipelines, utility telephone and cable poles, etc. And unlike mining, oil and gas, coal, transportation and real estate – run of river technology is sustainable, renewable, clean and significantly reduces greenhouse gas emissions.


Apr 22, 2009 at 3:05pm

Independent Power Producer (IPP) Run-of-the-River Technology FACTs:

IPPs contributed to the BC Economy. In fact, from the years 2001-2008 IPPs helped fund cashed starved BC Liberals with $800,000 and expected nothing in return.

IPPs provide jobs in BC for BCers. In fact, the industry employs many under-privileged BC Liberals and their friends.

IPPs contribute to the BC tax base. Although BC Hydro pays six times more for water rentals, the $60 million saved by IPPs goes to needy shareholders, some who live in BC (I think)

IPPS contribute to BC Hydro's bottom line by providing power for Californians when they need it most, in the spring and early summer. BC Hydro will pay $120 MW hour (Expected price for 2008 Energy call) and sell it for between $20-60 in an innovative new BC Liberal economic strategy called "Buy High and Sell Low"

In fact, this new strategy allows IPP companies to provide energy security and export electricity to the US without having to go though enormous amounts of 'red tape.' (Because we all know how bad red tape is!!!)


Apr 23, 2009 at 7:13am

Bern, er Yagin, stop posting drivel. We know about your connections to the private power industry.