B.C. minister stands by energy self-sufficiency

Monday, August 22, 2011

CTV News

B.C.'s energy minister says the province won't abandon its policy of electricity self-sufficiency – but he has no plans for any more expensive private power contracts.

Rich Coleman made the comments after a news report quoted the BC Hydro president saying he expected the government to abandon the policy, which requires it to buy private power at ten times the price it can produce on its own.

"We're not straying away from our commitment to self-sufficiency," said Coleman, adding that he expects B.C. will be providing its own power by 2016, and needs to have the electricity for expanding industry.

But he said that the government is not considering contracts with any other private power producers at the moment, and is looking towards a new hydroelectric dam at Site C, near Fort St. John.

"We're going to do something like Site C," said Coleman. "It's a better price."

The ten-year-old policy by the Liberal government required B.C. to ramp up energy production – but it could only create power through private development.

Open-market prices for electricity range from $4 to $52 per megawatt hour, but private power producers charge on average $65 per megawatt hour. New private sources coming on line average $124 per megawatt hour.

 

Those costs are enormous to the public utility, and Hydro president Dave Cobb said in a call obtained by the Vancouver Sun that he expects the government to back off on the policy.

"If it doesn't change, it would be hundreds of millions of dollars per year that we would be spending of our ratepayers' money with no value in return," he said according to reports. "The way the self-sufficiency policy is defined now…would require us to buy far more long-term power than we need."

Critics took Cobb's remark as proof that the policy to purchase new power from independent power producers is flawed.

"Right now BC Hydro is on the hook for $30 billion in energy purchase agreements for energy that we don't need and we sell at a loss south of the border," said Gwen Barlee of the Western Canada Wilderness Committee. "It's chaos."

NDP leader Adrian Dix said the utility has to change course and abandon private power.

"They acknowledge what's obvious, which is what we've been saying for years," he said. "This is bad business that damaged BC Hydro and ratepayers are paying the price."

Coleman said the contracts remained a good deal.

"People made decisions based on what the economics were at the time," he said. "If you look at the life of the contracts, they'll average out and they'll be fine."

Photo: BC Energy Minister, Rich Coleman

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