On April 28th, 2010, the government of the Province of British Columbia introduced a new piece of legislation. The BC Clean Energy Act sets 16 major objectives for the province, in an attempt to encourage responsible energy use and provide for the ability to export power out of the province, whether to neighbouring provinces or territories, or to the United States.
Some of the features of the new act include a mandate to BC Hydro to secure long-term export contracts with renewable power producers. Somehow, this is to be done without risk or cost to BC ratepayers. Doing this requires BC Hydro to leverage its massive power storage capabilities and use them to condition power provided by any new, private-sector, renewable energy projects. BC Hydro would also act as the middleman, selling the power generated by these alternative energy projects, without any direct benefit to itself or its rate-payers.
BC Hydro must merge with the BC Transmission Corporation (BCTC). BCTC was actually carved out of BC Hydro several years ago, and is now just returning to the fold. All assets, liabilities and employees of BCTC are to be transferred to BC Hydro. This integrates power generation and transmission in the province into one service provider.
One of the more controversial moves is to exempt so-called “strategic projects” from the approval process of the British Columbia Utilities Commission (BCUC). This removes projects like the new Site C hydro power project and the Northern transmission line from independent oversight. While the government maintains that it should be the organization to set policy, it is troublesome that they have removed any outside oversight. In the future, BCUC will have oversight only over local utility rates.
As part of the environmental review process for all new developments, cumulative impacts must be examined, unlike in the past. So to evaluate the new Site C, the review process has to take into account all the other dams and project along the Peace River as well. This is a welcome addition.
The Clean Energy Act also enshrines in law a long-held development policy, that large hydro dams would only be constructed on the Peace and Columbia Rivers, and even at that, that Site C would be the last dam to be built on the Peace River. Future power requirements beyond that are to be met from alternative sources, including run-of-river projects, solar, and wind.
There are three thermal power plants in BC, two in the north-eastern part of the province, and one at Burrard Inlet, near Vancouver. This law dictates that BC Hydro cannot make use of the generating capacity at the Burrard Inlet gas-fired plant unless it is an emergency, or they are authorized by government regulation. At this time, the Burrard Thermal Generator produces 7.5% of BC power, so this shortfall is going to have to come from somewhere else.
Under this new law, BC Hydro must meet 66% of all new demand through conservation policies by 2020. This updates the previous requirement of only 50%, set in the 2007 Energy Plan. To this end, BC Hydro is to implement a project to install smart meters in every home in the province over the next five years.
Another new component of the Act is to introduce a “Feed-In Tariff” program to encourage the development of new renewable power generation technologies. The government and BC Hydro will work with industry to define the program, which will then be established through regulation.
BC Hydro is not to sell or otherwise dispose of any the energy heritage assets, which belong to the citizens of British Columbia.
BC aims to become a net exporter of electricity, and many of the provisions of this act encourage that. The strengthening of the review process is a positive step. The concern is what effect the removal of oversight will have, and will the government act to push through projects in order to meet income and conservation targets? Many are skeptical.