The NDP government will proceed with the most expensive public megaproject in Canadian history.
Today, Premier John Horgan declared that his government is committed to completing the Site C dam in northeastern B.C.
B.C. Hydro had pegged the cost at $8.8 billion incuding a contingency fund, but a recent B.C. Utilities Commission report stated that it could eventually cost more than $10 billion.
Today, the government is saying B.C. Hydro is now estimating the cost of the dam at $10.7 billion. An early estimate in 2010 was $6.6 billion.
"Megaproject mismanagement by the old government has left B.C. in a terrible situation," Horgan said in a news release. "But we cannot punish British Columbians for those mistakes, and we can't change the past. We can only make the best decision for the future.
"It's clear that Site C should never have been started," the premier continued. "But to cancel it would add billions to the Province's debt—putting at risk our ability to deliver housing, child care, schools and hospitals for families across B.C. And that's a price we're not willing to pay."
To date, about $2.1 billion has been spent on the project, which is along the Peace River near Fort St. John.
The BCUC review said that shutting down the project would have added another $1.8 billion in remediation costs.
The second most expensive project is the Muskrat Falls megaproject in Labrador, which is now estimated to cost $10.1 billion. The total cost of Muskrat Falls, including financing costs, will be $12.7 billion.
Horgan's announcement didn't disclose the additional financing costs associated with the Site C dam.
Former premier Christy Clark decided to go ahead with the project even though domestic demand for electricity has been flat in B.C. for a decade.
In making today's announcement, Horgan pledged that a new B.C. Food Security Fund would be created based on Site C revenues. This would be "dedicated to supporting farming and enhancing agricultural innovation and productivity in the province".
He also promised a new "Project Assurance Board". It "will provide enhanced oversight to future contract procurement and management, project deliverables, environmental integrity, and quality assurance—all within the mandate of delivering the project on time and budget".
In addition, Horgan has promised a "community benefits programs, mandated with making sure that project benefits assist local communities, and increasing the number of apprentices and First Nations workers hired onto the project".