On January 20, BC Hydro issued a press release singing the praises of a new hydro transmission line not far from where preliminary work has begun to build the $9-billion Site C dam.

The release, headlined “New transmission line to power development in the south Peace,” featured boosterish quotes from Premier Christy Clark, Energy and Mines Minister Bill Bennett and BC Hydro CEO and president Jessica MacDonald, but made no mention of the dam.

Yet it highlighted for many one of the most vexing questions about why the dam, which is the single-most expensive megaproject in the province’s history, is being built at all: Why this project at this time?

“This line doubles the amount of power we can provide to the region,” enthused MacDonald. “We know it’s a growing region and BC Hydro needs to be one step ahead and ensure we can get power to where it is needed most. We want industry in B.C. to use clean power that comes from BC Hydro’s hydroelectric facilities.”

What MacDonald didn’t say, and Clark and Bennett did nothing to elaborate on either, is that the $300-million and counting transmission line is but the first of at least three in the region. Another two lines, which the provincial government wants exempt from review by the provincial electrical utilities regulator the BC Utilities Commission (the province also exempted the Site C dam project from similar review), will add hundreds of millions of dollars more to the tally for taxpayers.

Also not explained anywhere by MacDonald, Clark, Bennett and company is that virtually all of this new transmission infrastructure is being built at public expense to provide power to one entity and one entity alone — the natural gas industry. An industry, ironically, which has used and continues to use small portions of the gas that it drills to fire turbines that provide the power to move the gas through pipelines to processing plants and then on to consumers.

The Only Credible Explanation for Building the Site C Dam

Now, in the name of making “dirty” natural gas companies marginally less so, BC Hydro at the behest of the provincial government is aggressively pursuing a policy of providing “clean” hydroelectricity to the gas industry so that its greenhouse gas emissions are lowered here in B.C. It is this policy that provides the only credible explanation for why the Crown corporation is rushing to build the controversial dam at this time.

Indeed, BC Hydro’s own records show that in the absence of a vastly expanded natural gas sector in the province there is simply no need for the dam now or in the foreseeable future. It has told the B.C. Utilities Commission that it will be 2028 before domestic electricity consumption actually exceeds domestic production. And even then, according to BC Hydro, there is good reason to believe that that critical point may be even further down the road.

After filing its most recent load forecasts with the utilities commission, BC Hydro produced a quarterly report noting that its earlier forecasts for large industrial and commercial users were overstated. New information suggested that those consumers will likely use even less electricity in future years and that such declines could be most pronounced in key industries like the pulp and paper industry that directly and indirectly employ thousands of people.

Ironically, one of the main reasons why B.C.’s pulp and paper industry is in trouble is the rising cost of electricity. In 2014, hydro rates increased by 9 per cent, the first in a planned five years of increases totalling at least 28 per cent. The increases mark just the beginning of what could be years of steadily higher bills as customers repay the billions of dollars that BC Hydro must borrow to pay for Site C and the new transmission lines.

For certain pulp mills that rely more on power than chemicals to break down wood fibre, just the most recent increases in hydro rates threaten to put some of them out of business. Provincial Finance Minister Mike de Jong was told as much in June in a letter signed by the CEOs of four major forest companies including Canfor, West Fraser, Catalyst and Paper Excellence.

“While our industry prides itself on cost-cutting through constant innovation and improvements in efficiency, the magnitude and timing of the increase in B.C. Hydro rates combined with the increase in [provincial sales] tax, may result in many of the mills shutting down,” the letter reads in part.

No wonder, then, that BC Hydro believes that there could be possible declines in hydro usage among some industrial users. If just one mechanical pulp mill in the province shuts down, enough power to supply 70, 000 homes is freed up.

LNG Industry Could Spike Electricity Demand

The only scenario in which BC Hydro envisions hydro usage in the province exceeding available supply is in the event that one or more Liquefied Natural Gas or LNG plants are built on our coast. Such plants require enormous amounts of power to super-cool natural gas to the point where it turns to liquid form and can be loaded onto tankers for shipment overseas.

According to BC Hydro filings with the utilities commission it is only with the arrival of an LNG industry in the province that hydro consumption begins to outstrip domestic supply, and only then in about eight years.

Despite the fact that fossil fuel giants such as Shell and Petronas have yet to commit a dime to building LNG plants, the rush is on to supply them with hydroelectric power to offset some of the emissions associated with producing and potentially one day liquefying natural gas: a gas that no matter how you slice it is a climate-unfriendly fossil fuel that contributes significantly to global greenhouse gas emissions.

New Transmission Lines Encourage Gas Production

Whether or not an LNG industry emerges, however, the provincial government and BC Hydro are forging ahead with plans to supply hydroelectricity to companies drilling for natural gas in the Montney Basin. The basin, which extends out a considerable distance from the Peace River, contains B.C.’s largest remaining reserves of natural gas.

The basin has considerable “wet” natural gas deposits, which in the current environment of generally depressed natural gas prices is a good thing for the companies involved. Dry gas is generally made up of methane whereas wet gas may contain ethane, butane and pentane, or natural gasoline — all valuable hydrocarbons.

By extending transmission lines into the Montney Basin, the province and BC Hydro are encouraging increased gas industry activity. None of the gas that the companies drill for and produce will have to be used to fire turbines that move the gas through pipelines. Instead, all of the gas saved through electrification can be sold, especially the wet gas with its higher market value.

“Before, industrial customers had to burn gas to power their facilities. The new transmission line not only makes more projects possible, it means they’ll be even cleaner,” Premier Clark said in BC Hydro’s January 20 press release.

Greenwashing A Climate Unfriendly Industry

Of course, what neither Clark, Bennett or MacDonald say in the release is that there is actually no net benefit to the earth’s overheating atmosphere in making the gas industry here at home somewhat cleaner. While the gas industry’s greenhouse gas emissions in B.C. may be less bad than they would otherwise be, all of the gas saved through electrifying gas company field operations is simply sent down pipelines to the financial benefit of the sellers. The gas is then burned somewhere else at a collective loss to the planet.

For people who have been hunkering down at a protest camp near the Site C dam construction zone where temperatures have sometimes dipped down to a bone-chilling -25 C, every new announcement extolling the virtues of a new hydroelectric transmission line reinforces the notion that BC Hydro and the provincial government have a build-it-and-they-will-come attitude with what is the single-most expensive megaproject in the province’s history.

The more transmission lines erected to allegedly “green up” the field operations of fossil fuel companies, the more fossil fuel industry activity. The more such activity, the more the government and BC Hydro can justify Site C.

The transmission line that Clark and company enthusiastically praised in the BC Hydro press release of January 20 is known as the Dawson Creek-Chetwynd Area line or DCAT. The project consisted of building two new lines of 12 kilometres and 60 kilometres in length, construction of a new substation and upgrades to two other facilities.

Transmission Lines Exempted from BCUC Review

BC Hydro’s press release states that DCAT’s cost is $296 million. But a document that the Crown corporation filed last fall with the B.C. Utilities Commission tells a different story. In that document, the actual cost of the project as of September was just under $302 million or nearly $6 million higher than that stated in BC Hydro’s press release. And the document, which is signed by BC Hydro’s chief regulatory officer, Tom Loski, notes that the project is not yet completed. So there will be further costs, including those associated with taking down all of the lower kilovolt lines that the new transmission infrastructure replaced.

BC Hydro is required by law to file information on DCAT because that project was subject to B.C. Utilities Commmission review. The public therefore has access to details on the $302 million and counting transmission line. But the provincial government has indicated that two other proposals to build massive new hydroelectric transmission line infrastructure in the Peace region — infrastructure explicitly intended to foster more natural gas industry developments — will not be subject to such reviews and therefore the public may learn next to nothing about them.

Last November, Energy Minister Bennett explained why the government did not want the projects brought before the BCUC. In a Business Vancouver story, Bennett said: “My understanding right now is that if I do not direct the BCUC to allow these projects to go ahead, that we may lose some interest on the part of the gas companies . . . They just don’t feel that they can wait for a long BCUC process.”

Bennett’s position leaves Karen Goodings, Area B director for the Peace River Regional District, decidedly uncomfortable.

“Our concern, of course, is once again the avoidance of going through the process that is in place to examine these things,” Goodings told Business Vancouver. “It’s almost as though this is another excuse for building Site C.”

An unusual wrinkle of one of the proposed transmission lines known as the North Montney Power Supply Project is that the 140 kilometre-long line will be built and operated by a private company. ATCO Power will build the transmission infrastructure to deliver electricity to the remote Pink Mountain area well to the north of Fort St. John. The area is the site of major gas-drilling and fracking operations by Progress Energy, owned by the Malaysian state-owned corporation, Petronas.

‘Ministerial Exemption’ Sought to Speed Transmission Line

In a letter last March to Les MacLaren, an assistant deputy minister in Bennett’s ministry, ATCO vice-president Dale Friesen explained why neither ATCO nor Petronas want the project subject to BCUC review.

Friesen said a “ministerial exemption” exempting the project from BCUC review was being sought because of the “aggressive schedule” required to build the project.

“Progress Energy is developing gas production capacity in the North Montney Basin in support of the Pacific Northwest LNG project proposed by Petronas, Progress’ parent company.”

“ . . . By utilizing BC Hydro supplied power instead of burning natural gas, Progress expects to decrease emissions in the region by approximately a third. Progress further expects to realize improved equipment performance, decreasing the risk associated with gas delivery to LNG facilities.”

“The project is being developed on an aggressive schedule to meet with Progress timelines. Failure to meet these timelines reduces the feasibility of electrification and poses a substantial threat to the project proceeding.”

Nothing in the information obtained by the Regional District indicates what the projected costs to build the line and related infrastructure are. But given that the line is twice the length of the DCAT line and goes through rugged and remote terrain, it seems reasonable to conclude that it will be a vastly more ambitious and expensive project.

And somehow, despite all of the costs associated with building the line and all of the ongoing costs of purchasing electricity carried by the line, Goodings believes that Petronas will be financially ahead of where it would be if it produced its own power with natural gas.

“They are extremely aware that they can produce their own power. There has to be a benefit there,” Goodings says. “If they can produce their own power cheaper than hydro, they will do it.”

Unfortunately, nothing by way of information supplied to the Peace River Regional District by ATCO sheds light on relative energy costs or on what, if any subsidies, ATCO and Petronas may benefit from in the event the line is built.

Given that three separate transmission lines are either built or about to be built to supply electricity to an industry that has for decades produced its own power from the gas it draws from the ground, Goodings thinks the need for an independent review of all new transmission line projects in the Peace region and the Site C dam is obvious. Especially when the government’s long-touted promise of an LNG industry appears more remote with each passing day.

“Are these transmission lines the reason for Site C? If that’s the reason we’re spending $9 billion then yes, there’s an impact on the taxpayer, and they should not be exempt from review,” Goodings says.

No amount of boasting about all the clean energy supplied by Site C and an emerging network of new transmission lines gets around the fact that an awful lot of public money is about to be dropped in the Peace Region.

Goodings, like others who have called on the government to subject the Site C project to B.C. Utilities Commission review, believes it’s in our collective interest to know if we are about to spend billions of dollars on a new dam and hydro lines that, at the end of the day, may benefit the public very little while benefitting one industry very much.

Ben Parfitt is a resource policy analyst with the Canadian Centre for Policy Alternatives.

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In an exclusive interview with DeSmog Canada, former BC Hydro CEO Marc Eliesen says ratepayers will face a “devastating” increase in their electricity bills if the Site C dam is built and emphasizes there is no rush to build new sources of power generation in B.C.

“With Site C, BC Hydro ratepayers will be facing a devastating increase of anywhere between 30 and 40 per cent over the next three years,” Eliesen told DeSmog Canada in his first interview on the subject.

“There’s no rush. There’s no immediate need for Site C or any other alternative energy,” he said.

Eliesen’s comment about the lack of immediate need for the power echoes statements made by Harry Swain, the chair of the panel that reviewed the Site C hydro dam for the provincial and federal governments. In March, Swain told DeSmog Canada the B.C. government should have held off on making a decision on the dam.

With a price tag of $8.8 billion, the 1,100-megawatt Site C dam is the most expensive public project in B.C. history. The hydro dam, which would impact 13,000 hectares of agricultural land, has been proposed for the Peace River for three decades.

In late 2014, the provincial and federal governments approved the project and this July construction permits were issued despite pending court challenges by First Nations.

Eliesen, an economist by training, has also served as chairman and CEO of Ontario Hydro, chairman of Manitoba Hydro and has held senior roles with the federal government and the governments of Ontario and Manitoba. In November, Eliesen called the National Energy Board’s review process for the Kinder Morgan Trans Mountain pipeline “fraudulent” and a “public deception” as he dropped out of the process.

Failure to Consider Columbia River Power ‘Non-Sensical’

Eliesen said there is no rush to build new generating capacity in B.C., leaving “more than sufficient time to evaluate alternatives” that are more cost effective and minimize environmental impacts.

The alternatives include everything from geothermal to BC Hydro’s Burrard Thermal plant — due to be decommissioned in 2016 — to the 1,100 megawatts of electricity B.C. has access to through the Columbia River Treaty, Eliesen said.

Not considering using the Columbia River power to meet B.C.’s needs is “non-sensical,” Eliesen said.  (See: The Forgotten Electricity that Could Eliminate Need for Site C Dam)

“If there is a demand for the power, well you clearly have an available supply, which you can depend on,” he said.

“If there was some massive escalation in demand that you needed immediately, well my goodness, you’ve got two instant sources: there’s 1,100 megawatts from the Columbia River and almost another 1,000 from the Burrard Thermal Plant, which was converted from coal to natural gas some time ago.”

Mining, LNG Companies Not Paying ‘Fair Share’

Eliesen also critiqued BC Hydro for adopting a price structure that results in everyday British Columbians subsidizing heavy power users.

“Whether it’s mining or proposed LNG plants or anything of that nature …  They’re all subsidized by other hydro ratepayers. Those heavy power users do not pay the true cost,” Eliesen said. “They are not paying their fair share.”

The B.C. Utilities Commission used to review the cost of service, but that doesn’t take place any more, Eliesen said.

“The provincial government basically declared we don’t want the commission — we don’t want anyone — looking at BC Hydro plans. I think the result has been quite devastating.”

The B.C. government exempted the Site C dam from a review by the B.C. Utilities Commission, despite calls from its own expert panel to refer the project for an independent review of costs and need. The province’s failure to consider the panel’s recommendations has since become the basis for the Peace Valley Landowners Association court challenge against the Site C dam.

Eliesen noted other jurisdictions are conducting much more thorough analyses of hydro projects, noting two projects in Manitoba he recently advised on. 

“They went through the most detailed evaluation by the Manitoba Public Utilities Board that ever could have taken place,” Eliesen said. “The kind of analysis and investigation and due diligence that was taken has never taken place recently in British Columbia.”

Site C Dam Price Tag Likely to Escalate

In 1993, when Eliesen was the president and CEO of BC Hydro, he issued a public statement on behalf of the board stating that Site C would never be built because of its significant negative environmental, economic and social impacts.

That position quietly went by the wayside when the Gordon Campbell government was elected, Eliesen said, noting that electricity costs have increased at a far quicker rates than other jurisdictions since then.

Over the years, Eliesen has seen the cost of the Site C dam nearly double. 

“I’ve seen the costs of Site C escalate enormously,” he says. “It used to be $5, $6 billion, then it was $7.9, now it’s $8.8 billion. It’ll easily reach, if it’s ever built, in the $11 to $12 billion dollar range.”

Eliesen says the costs of Site C haven’t been adequately reviewed and there are “too many conflicting interests in BC Hydro for it to undertake its own due diligence on this matter.”

Calls for a moratorium on construction on Site C have gained strength recently with the Greater Vancouver Regional District and Peace River Regional District both calling on Premier Christy Clark to pause the project while active court cases are completed

On July 23, the B.C. Government and Service Employees’ Union announced its opposition to the Site C dam due to its violation of indigenous rights and the massive loss of habitat and agricultural lands.

Site C Dam ‘Doesn’t Make Any Sense’

Despite the growing calls for a moratorium, the B.C. government appears hell-bent on pushing ahead with building the dam.

Asked why the government continues to push ahead, Eliesen said it doesn’t make any sense.

“Well I can’t talk for the government, so I don’t know, other than they want some major project undertaken during their current election term,” he said.

“It doesn’t make sense in the context of environment, it doesn’t make sense in the context of wanting to work with First Nations and it doesn’t make sense, more specifically, on the economic impact because the B.C. ratepayer will pay enormously over the next three years.”

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On the banks of the Peace River on Saturday, Grand Chief Stewart Phillip told hundreds of opponents to the Site C dam that he will be handcuffed if necessary to stop BC Hydro’s mega project from moving ahead. 

“From this point forward we have to really focus our efforts on how we’re going to physically stop this project from happening,” Phillip said during a speech at the 10th annual Paddle for the Peace. “The provincial cabinet recently approved permits to allow construction to begin. That’s where the rubber is going to hit the road.”

An emotional Phillip said B.C. is on the eve of an uprising after the government has repeatedly dealt in “bad faith” with First Nations.

Grand Chief Stewart Phillip has vowed to be arrested to stop the Site C Dam.

“If push comes to shove, I for one — being a grandfather of 14 grandchildren who I absolutely adore — I am more than willing to be arrested as long as that will contribute to stopping this project,” he said.

“I know when that moment comes I will not be alone.”

The Last Paddle for the Peace?

About 300 boats took to the water Saturday in what could be the last Paddle for the Peace — held on a stretch of the Peace River that will be flooded if the $8.8 billion Site C dam is built.

Construction is due to start on the dam any day now despite a pending Treaty 8 legal challenge, due to be heard by the federal Supreme Court on July 20.

“This is a watershed moment in the province of British Columbia and in this country,” Phillip said. “We simply can not — we can not allow this to happen.”

Beth Steiner, 8, helps bag lettuce at her parents market garden stand in the Peace Valley. The land the Steiners grow everything from corn to watermelons on will be flooded if the Site C dam is built.

Calls for a moratorium on construction on Site C have gained strength recently with the Greater Vancouver Regional District board, representing 23 local governments and 2.5 million people, voting to ask Premier Christy Clark for a two-year moratorium on construction.

The Peace River Regional District — which includes Fort St. John, the city that would see the most economic activity from the dam — voted on Thursday to write a letter to Clark to request that all construction on Site C be stopped until active court cases regarding the project have been completed.

The B.C. government has been criticized for pushing ahead with the project while ignoring repeated calls for an independent review of costs and demand — a recommendation made by the government’s own panel.

David Suzuki: ‘We Fundamentally Failed’

Famed environmentalist David Suzuki changed his schedule to join the paddle on Saturday (and helped rescue some capsized canoeists while he was at it) because the fight for the Peace Valley is near and dear to his heart. During a keynote speech, he told the crowd about his involvement with stopping the Site C dam for the first time in 1981.

“Thirty-five years later, guess what? We’re fighting exactly the same battles all over again,” Suzuki told the crowd. “What we thought were victories were not victories at all, because we fundamentally failed. We failed to shift the way we see our place on the planet.”

Ranchers Dick and Renee Ardill know the drain of the 34-year fight against the dam all too well. When the dam was first defeated, Dick was a spry 54-year-old. Now he’s 88 and grasps his truck for balance as he walks.

Dick Ardill has spent his 88 years ranching in the Peace Valley. His parents homesteaded the land in 1910.

His daughter Renee is sick of telling their story.

“I’m tired of the whole thing,” she told DeSmog Canada during a break from baling hay. “I’m tired of the stupidity of it.”

“You have to just keep going on and doing your job and, if we lose and they build the thing, we’ll worry about that when the time comes. In the meantime, I’m hoping that someone comes to their senses.”

While the recent rejection of the Peace Valley Landowners Association legal challenge was disappointing, it’s not the end of the world, Renee says.

“The battle goes on.”

Injunctions Will Be Filed to Stop Site C Dam Construction

“This is the tenth year we’ve done this and if BC Hydro and B.C. have their way we won’t be doing it any more,” said Roland Willson, chief of West Moberly First Nation, before canoes were put in the water.

West Moberly Chief Roland Willson.

In an interview with DeSmog Canada, Willson said he’s holding out for the courts to make the right decision.

“The dam is a direct infringement of our treaty rights,” he said.

Willson said injunctions will be filed to stop any construction that will cause “irreparable harm.”

Farmer Ken Boon, who hosts the Paddle for the Peace on his land, says the early construction plans look like a soft start.

“I’m still confident this dam will not be built,” Boon said. “All we’ve got to do is win one court case.”

Ken Boon is confident the Site C dam will not be built.

Boon’s land will be flooded if the dam is built, but he has yet to be approached by BC Hydro about moving.

“I’m pretty sure they’re expecting a lot of these to go to expropriation if things carry on,” he said.

As it stands, Boon and his wife Arlene still aren’t thinking about moving.

‘We’re Being Mowed Over’

Shawna-Marie Phillips is less optimistic. If construction moves forward, a 3,000-man camp will be located one kilometre from her organic farm and ranch.

Sometimes it feels like she’s yelling into the void and nobody’s listening, she said.

Given that the Site C dam is the most expensive public project in B.C. history, yet only one reporter from a major news outlet attended Saturday’s event, Phillips could be forgiven for feeling out of sight and out of mind.

“I feel like we’re being mowed over,” she said.  “I get a feeling that this is the last time.”

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