The B.C. government cannot expect support from First Nations for its much-touted liquefied natural gas (LNG) projects if the province insists on steamrolling ahead with the Site C dam, a First Nations chief is warning.

“They want support on LNG, and the level of destruction that is going to bring, and then they want Site C as well. They can’t have them both,” Chief Roland Willson of West Moberly First Nation told DeSmog Canada.

There is no logical reason to have both, Willson added, saying the provincial government has ignored alternatives to Site C, even as the federal Joint Review Panel found there is no immediate need for the power and excess power would be sold at a loss.

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Treaty 8 First Nations in B.C. are vehemently opposed to BC Hydro’s plans to build a third massive dam on the Peace River that would flood more than 5,000 hectares of land, swamp more than 330 recorded archaeological sites and — in direct contravention of the 1899 treaty — destroy land now used for hunting, fishing and collecting medicinal plants.

Initially, some Treaty 8 Tribal Association nations were willing to look at what the B.C. government was offering in terms of mitigation and compensation, but, as more information became available, Willson noted a change in attitude.

“Now everyone is opposed,” he said.

The treaty states First Nations have the right to continue with their way of life “for as long as the sun shines, the grass grows and the rivers flow.”

But with massive resource development in the area, the sun, grass and rivers are all at risk and Site C is the final straw, Willson said.

With high levels of methylmercury in fish because of rotting vegetation from the previous two dams, fishing is restricted and ungulates, such as caribou, are being destroyed by the major projects, said Treaty 8 Tribal Association Chief Liz Logan, who has asked the UN Special Rapporteur James Anaya to call on the government of British Columbia to assess cumulative impacts of industrial activity in the area.

A recent study, Passages from the Peace (PDF), by the David Suzuki Foundation and Global Forest Watch Canada found 28,587 kilometres of pipelines, 45,293 kilometres of roads and 116,725 kilometres of seismic lines used for oil and gas exploration within the Peace region.

“We have become the cash register for the province . . . .Now our way of life is going to be interfered with again,” Logan said.

“We are bush people and this is our grocery store, our pharmacy, our school and our church. It still sustains us.”

The treaty is alive, despite damage inflicted on the ecosystem by resource extraction and previous Peace River dams, so the province should think carefully about ramifications of treaty-breaking, Willson said.

The Joint Review Panel agreed the dam will have significant adverse effects on First Nations practices and heritage and that many of those effects cannot be mitigated.

A total of 21 First Nations would be affected if the valley is flooded and, with numerous legal decisions reasserting First Nations’ constitutional rights, there is growing awareness that a court challenge could hold up the $7.9 billion project for years if the province decides this fall to proceed.

First Nations file for judicial review of panel report

This month the Mikisew Cree First Nation, which has nine reserves in northeastern Alberta, and the Athabasca Chipewyan First Nation, which has eight reserves near the southwestern tip of Lake Athabasca, filed a Federal Court application for a judicial review of the Joint Review Panel report.

The two Treaty 8 First Nations rely on the Peace Athabasca Delta for plant gathering, fishing, hunting and travel through the many lakes and river tributaries and presented evidence at the hearings that showed the Delta is already ecologically stressed, with low water levels affecting wildlife habitat and harvesting.

Any further changes to water levels in the Delta could prevent First Nations from exercising their treaty rights, according to the application, which aims to have some sections of the Joint Review Panel report declared invalid and unlawful, some sections quashed and others referred back to the panel for further consideration.

The application is asking the Federal Court to prohibit the federal and provincial governments from taking any further actions that would allow Site C to proceed until a new report is issued that complies with “principles of procedural fairness.”

BC Hydro spokesman Dave Conway said he could not speculate about the possibility of Site C heading to court.

“However, I can tell you that we aim to fulfill our duty to consult and, where appropriate, accommodate aboriginal groups,” he said.

Logan said the five Treaty 8 nations have not yet voted on whether to go to court, but there are heavy hints that any attempt to build the dam will immediately become entangled in legal battles.

Chief's mandate: 'Oppose this right to the end'

“The only mandate I have right now is to oppose this right to the end. We are going to go back to our people once we hear the decision,” Logan said.

Willson supports the judicial review of the environmental assessment and then, if necessary, a court challenge.

But going to court is expensive, especially when going up against the deep pockets of BC Hydro and the provincial government, he said.

BC Hydro has talked with more than 50 aboriginal groups in hundreds of meetings since 2007 and will continue to look for mitigation measures, Conway said.

“We are committed to providing lasting benefits to aboriginal groups through the construction and operation of the project. In addition, we are negotiating impact benefit agreements with some First Nations where appropriate,” he said.

An impact benefit agreement could mean a lump sum payment, payments over time, cash equivalent benefits or agreements around provincial Crown land, Conway said.

But a major hurdle is the distrust First Nations have for government.

West Moberley First Nation Chief Roland Willson. Credit: Garth Lenz.

“Nothing the B.C. government has done since I have been chief has made me trust that I can believe anything they do,” Willson said.

Logan said she always tries to be hopeful.

“But, unfortunately, in my 16 years of working with this government, I have learned not to really trust what comes out of their mouth,” she said.

Site C likely to get entangled in court challenges

As decision time approaches, other Site C opponents are counting on the power of First Nations.

There is no doubt Treaty 8 nations have a strong case for stopping the dam plans, said Andrea Morison, coordinator of the Peace Valley Environment Association.

“That bodes very well for the campaign and I absolutely expect it would go to court,” Morison said.

However, in the meantime, Peace Valley residents and First Nations are hoping Site C will be rejected and there will be no need for a legal battle.

That will take more pressure from people in southern B.C., Logan said. A petition to stop the Site C dam and save the Peace River Valley has been set up at StopSiteC.org

“We are doing everything we can, along with our environmental friends from down south, to create awareness and tell people ‘it’s coming out of your pocket,’ ” she said.

Photo: Treaty 8 Tribal Chief Liz Logan by Zack Embree.

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Every day British Columbians flick on light switches, power up their computers and cook dinner, confidently expecting the power supply will not fail them.

The expectation that reliable electric power will be available is emphasized by BC Hydro as it touts benefits of the proposed Site C dam on the Peace River and the resulting “clean” energy that could theoretically power 450,000 homes each year.

“Our forecasts show the demand for electricity will increase by approximately 40 per cent during the next 20 years,” said Charles Reid, BC Hydro president.

“And an emerging liquefied natural gas sector could further increase the demand for electricity.”

But, looking into the future is an unreliable art and, while BC Hydro insists that the power will be needed by the time the $8-billion project is completed in 2024, opponents say that, especially at a time when the energy market is undergoing rapid change, the mega-dam will end up as a costly white elephant.

The unknowns include changes in demand because of economic development, the cost of electricity, public policy changes and development of alternative energy sources.

Need for Site C dam not proven: joint review panel

The joint review panel assessing the Site C dam concluded that, although there will be an increasing need for power in the future and Site C is likely to be the most cost-effective option, BC Hydro failed to prove that the new energy would be needed within the timeframe set out in the proposal. [view:in_this_series=block_1]

“The panel concludes that the proponent has not fully demonstrated the need for the projects on the timetable set forth,” says the report submitted this month to the federal and provincial governments.

The panel makes it clear that federal and provincial government decision-makers need to be sure the power is needed before giving the go-ahead.

Justification for Site C “must rest on an unambiguous need for the power and analysis showing its financial costs being sufficiently attractive as to make tolerable the bearing of substantial social and other costs,” the report says.

The findings have sparked more questions about the need for Site C power, especially as annual figures show B.C. is usually a net exporter of energy

“This opens the door for us to have conversations about alternatives – local projects with benefits for local people – projects like smaller hydro, wind, natural gas and even geothermal,” said Treaty 8 Tribal Chief Liz Logan.

LNG argument has cracks

Even the LNG argument — used by Premier Christy Clark in last year’s election campaign as a major reason for building Site C — is losing traction as most companies indicate that, for compression and liquefaction of the gas (which takes vast amounts of electricity), they will generate their own power by burning natural gas already flowing through their pipes.

In order to burn natural gas, the LNG industry has been handed a blanket exemption from the Clean Energy Act, raising concerns about the government’s commitment to cutting greenhouse gas emissions.

The Pembina Institute estimates that if five LNG facilities are built, the industry would more than double B.C.’s carbon pollution, single-handedly emitting nearly three-quarters as many greenhouse gases as Alberta’s oilsands.

However, even those who argue that LNG plants should be powered using renewable electricity, don’t necessarily point to a need for the Site C dam. Clean Energy Canada, for instance, argues that the LNG industry can power itself on regionally produced clean electricity, mostly wind power on B.C.’s north coast.

Even under that scenario, LNG plants will need power from BC Hydro for ancillary needs, such as running the site, said Dave Conway, BC Hydro spokesman.

Initial estimates said increased capacity would be needed by 2027/28, but, with taking LNG plans into account, even a “low LNG load forecast” moves the need for energy up to 2024.

“Mining is also one of the big drivers so, with or without LNG, new capacity and new power is needed by 2024,” Conway told DeSmog Canada.

In B.C., about one-third of electricity is used by residential customers, another third is used by commercial customers and another third goes to industrial customers, he said.

“The need for this project comes from growing demand,” Conway said. “Economic development is the primary driver.”

BC Hydro overestimates demand for power: retired federal economist

That need continues despite residential customers reducing power use because of conservation and BC Hydro’s own documents showing it plans to meet 70 per cent of future demand growth through conservation. It is essential that BC Hydro is able to meet peak load requirements, Conway said, even though peak demand may come only one day a year.

However, retired federal economist Erik Andersen said BC Hydro has a chronic problem with over-estimating the demand for power.

“Over the course of the past four decades, the need for a Site C generation facility has been part of the larger and exaggerated demand narrative BC Hydro has been telling,” he told DeSmog Canada..

Andersen crunched the numbers and is questioning Hydro’s estimates of a population growth of one million people in the next 20 years, which he says doesn’t fit with B.C Statistics forecasts.

“There has been one heck of a rollback in population growth, but BC Hydro seems to want to ignore that,” he said.

Future demand analysis based on "serious market failure"

Energy economics expert Marvin Shaffer, adjunct professor in the school of public policy at Simon Fraser University, said BC Hydro’s analysis of future demand is based on a “very serious market failure” in the pricing of electricity.

“The only reason Site C is ‘needed’ is because the government is preventing BC Hydro from using gas-fired thermal units to back up its hydro system when needed,” he told DeSmog Canada.

“If the project is built as planned, it will be surplus to forecast requirements for many years and sold in the export spot market at a significant financial loss.”

Even if some power was sold to LNG plants, which would otherwise use gas-fired thermal power to meet their energy needs, it wouldn’t be at a price that would begin to recover Site C’s full cost, Shaffer said.

It is unlikely that surplus power could be exported because energy produced at Site C would be too expensive, agreed NDP opposition leader John Horgan.

“With the advent of shale gas everywhere in North America, the price of electricity has plummeted because people can get gas and turn it into electricity at a relatively low price,” he told DeSmog Canada.

Is the era of building big dams over?

Government will decide this fall whether to proceed with Site C, but Energy Minister Bill Bennett already seems convinced of the need for more power.

“We don’t need the electricity today or tomorrow or the next year, but we are pretty darn sure we are going to need it 10 years from now,” he told reporters after the release of the joint review panel report.

However, Paul Kariya, executive director of Clean Energy BC — an industry trade association that represents independent power producers, including gas generators —told DeSmog Canada that predicting power demand is a “mug’s game” and there is a way to meet power needs incrementally.

“Times have changed. We’ve been through an era of building big dams,” Kariya said. “When you build a dam, you get this one massive lump of power and that’s not the way that energy is planned for anymore. What we offer is a more incremental approach.”

Up next: Part 3 of our Site C series will explore the alternatives to building the Site C dam.

Photo: "LNG Canada joint venture agreement signing" by Province of British Columbia

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The proposed Site C dam on the Peace River is the best alternative for providing B.C. with reliable cheap power, but BC Hydro has not proved that the power is needed in the immediate future, says a much-anticipated report by the federal Joint Review Panel.

The report does not give a definitive yes or no answer to the planned 1,100 megawatt dam, which will flood about 5,500 hectares of land, but includes 50 recommendations on issues such as threats to endangered wildlife, health effects for those living in the area and destruction of First Nations heritage sites.

If approved, project construction would begin in 2015 with completion projected for 2023.

The ambivalent report says B.C. will need new energy and new capacity at some point and “Site C would be the least expensive of the alternatives and its cost advantages would increase with the passing decades as inflation makes alternatives more costly.”

However, “the panel cannot conclude that the power of Site C is needed on the schedule presented.”

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There are also important environmental, social, economic, health and heritage costs, panel members concluded.

Risks to fish and wildlife include harmful and irreversible effects on migratory birds and species such as the western toad and short-eared owl.

“Justification must rest on an unambiguous need for the power and analyses showing its financial costs being sufficiently attractive as to make tolerable the bearing of substantial environmental, social and other costs,” it says.

High costs yet alternatives not considered

The report notes that BC Hydro has not looked closely enough at alternatives such as geothermal energy.

“The panel concludes that a failure to pursue research over the last 30 years into B.C.’s geothermal resources has left B.C Hydro without information about a resource that BC Hydro thinks may offer up to 700 megawatts of form, economic power with low environmental costs,” it says

The estimated $7.9 billion cost raised questions, but panel members said they do not have the information, time or resources to look at the accuracy of cost estimates and recommended that, if the project proceeds, costs should be examined in detail by the province’s independent regulator, the B.C. Utilities Commission (BCUC).

The Liberal government previously exempted Site C from BCUC scrutiny and, although the recommendation was applauded by groups such as the Peace Valley Environment Association, Energy Minister Bill Bennett immediately threw cold water on the idea.

“This project has been poked, prodded and analyzed for the last 35 years,” he said

“I think subjecting it to another review after all the years it has been studied, is not a good use of public money.”

Bennett believes BC Hydro will keep to its budget, despite reports showing mega-dams around the world often run 50 per cent over budget.

BC Hydro has included $1.52 billion for inflation and contingencies, he said.

“Of course with large projects like these, there’s no guarantees, but with such a large contingency fund and such a large fund for inflation and all the work that BC Hydro has done, I think we can have confidence in that final number,” he said.

The proposal must gain the approval of the federal and provincial governments and Bennett said he will take a recommendation to cabinet this fall after further environmental and First Nations consultations.

Indecisiveness not all around

Bennett, who said he views the Joint Panel review as “mostly positive,” emphasized that he has not yet made up his mind about the dam, which, if approved, would be the most expensive project built in the province.

“I am right square in the middle of this,” he said.

NDP leader John Horgan said the report shows the Liberal approach to Site C has been reckless and does not have a foundation in the realities of the North American energy market.

“The challenge ratepayers have is they are facing 28 per cent rate increases over the next five years and we have a government proposing to spend $8 billion on power that we may not need, at a time we don’t have the money to spend,” he said.

Former BCUC chair Mark Jaccard, professor in the school of resource and environmental management at Simon Fraser University, said he is impressed the panel tried to address big questions such as climate impact.

“But I was a bit frustrated that the panel waffled so much. I think I wanted them to say yeah or nay,” he said.

It is a difficult decision, because there are compelling arguments on both sides, and politicians will ultimately have to take a stand, but it would have been good to have a definitive opinion from experts who listened to presentations at the hearings, Jaccard said.

“They are trying to say all the things for all the people,” he said.

Signs of optimism

In the Peace Valley, the report is generating some optimism and Andrea Morison, Peace Valley Environment Association coordinator, applauded recommendations that show the panel has significant concerns about impacts.

“It shows the proponent has not fully demonstrated the need for the project and that there are other sources they should be looking at. Another key point is they can’t conclude the accuracy of the cost estimate,” she said.

Morison believes that once Bennett has studied the report he will decide to follow the key recommendation of referring it to BCUC for a cost review.

“One thing we can count on with politicians is that they do change their minds and it’s not solely his decision,” she said.

Hudson’s Hope Mayor Gwen Johansson also wants Bennett to pass the project to BCUC for scrutiny.

“It would be disappointing if he did not follow that recommendation,” she said.

Treaty 8 First Nations Tribal Chief Liz Logan said the core message to government is why build a project that is not needed. Alternative solutions such as wind power or smaller hydro projects must be considered instead, Logan said.

“We are still going to be vocal about it,” said Logan, who hopes British Columbians throughout the province will put pressure on the province.

“This project doesn’t just affect us on the ground, it’s going to affect the pocketbook of every British Columbian,” she said, adding she wants the project’s cumulative effects studied.

Those living in the area that will be affected by the dam see the report as validation of their belief that the adverse effects outweigh any benefits.

Spring is finally coming to the valley, said Ross Peck, a retired guide outfitter whose family has lived in the area since 1924.The grass is greening up, the leaves are about to pop and the valley is full of animals. I saw the first osprey today he said.

If the dam goes ahead, part of his property will be flooded, roads will cut close to his home and Peck believes he would have to leave.

“I don’t think we could sit on our deck and watch them clearcutting for the reservoir,” he said.

Esther Pederson, who would lose part of her farmland and her home to the dam, has little faith in any consultation process.

“The consultation so far has been ‘do you want to sell your farm now or later,’ ” she said.

Armed with the concerns raised in the report, it should be possible to stall approval at least until the next election, Pederson said.

“It could be dragged out forever and the First Nations people are lined up to take the government to court,” she said.

Photo: Peace Valley courtesy of Andrea Morison and Don Hoffmann.

The Narwhal’s reporters are telling environment stories you won’t read about anywhere else. Stay in the loop by signing up for our free weekly dose of independent journalism.