The Site C money pit is just the beginning. Where next, B.C.?

Site C dam, artist's rendering. Source: BC Hydro.

The Site C dam is in trouble again. Delays caused by the COVID-19 pandemic, cost overruns that promise to be significant, foundation engineering problems – the now $10.7 billion price tag is about to rise again. But there is some much-needed context that is being ignored: implementing CleanBC requires the equivalent of another five Site C dams just to hit 2030 targets. Where will that power come from? If BC Hydro is having this much trouble with the current project, it doesn’t bode well for more hydro-electric dams.

The Site C morass

George Ralston, BC minister of energy, mines, and petroleum resources.

“I am very concerned about the latest reports that BC Hydro has provided to the BCUC [BC Utilities Commission] on the Site C project,” Energy Minister Bruce Ralston said in a Friday release. “COVID-19 has created significant challenges for the project that we could not have anticipated.”

Prior to the pandemic, “the project remained on schedule for the first generating unit to go into service in late 2023 and a final in-service date in 2024,” BC Hydro CEO Chris O’Riley wrote in a letter to the BCUC. BC Hydro halved the number of construction workers in March, then began ramping back up in May. According to O’Riley, continuing delays re-starting some of the work has put the project behind schedule and there is now “uncertainty” about when the dam will start up.

If only this was Site C’s only problem.

O’Riley also informed BCUC of a major engineering problem with the foundation on the right bank. Costly “enhancements” will be required, but no word on the amount.

Then there were issues that predate the pandemic: amendments to the civil works contract, more workers needed than expected, extra expense for reservoir cleaning and related tasks, and higher than anticipated costs to settle First Nation treaty infringements.

Just how serious are the problems? We don’t know and may not for months. The pandemic continues to be a huge unknown. And BC Hydro still has the foundation problem to solve and cost over-runs to grapple with.

Ralston was worried enough to appoint former deputy minister Peter Milburn as a special advisor to keep tabs for the government and provide “independent advice.”

Bigger picture

BC Hydro has a surplus of electricity at the moment and Site C’s 5,100 gigawatt-hours per year will exacerbate that problem until demand catches up. But that could happen much sooner than most British Columbians realize, for two reasons.

Artist’s rendering of the LNG Canada facility.

One, BC has committed to electrifying LNG. There are serious questions about BC Hydro’s ability to make that happen and just how much electricity LNG plants will ultimately consume, but it will probably be in the neighbourhood of half of Site C’s output.

Two, electrifying transportation, buildings, and industry as part of CleanBC – the NDP government’s climate plan – requires enormous amounts of power. How much electricity, you ask?

Minister Ralston’s office told Energi Media in an email that “preliminary analysis indicates that policies designed to achieve BC’s greenhouse gas emission reduction targets would result in an incremental demand for electricity in the range of 7,000 – 11,000 GWh by 2040 as compared to BC Hydro’s 2020 load forecast.

On the low end, that’s two Site Cs.

The Canadian Energy Research Institute’s 2018 study about electrification of the Canadian economy came in around 26,000 GWh, five Site Cs. A 2018 paper from Clean Energy BC titled Electrification Now arrived at the same number but it was needed by 2030 to meet the first CleanBC targets; by 2050, double or triple that amount will be needed.

Finally, a University of Victoria 2020 study calculated that 55,000 GWh per year – 10 Site Cs – would be required by 2055 to electrify all light, medium, and heavy-duty ground transportation.

These are all educated guesses that vary according to the assumptions used in the models, but it’s pretty clear that a tremendous amount of new electricity will be needed over the next few decades.

Electricity doesn’t grow on trees

A BC Hydro planning manager told me during a 2017 interview that Site C would be the last dam BC Hydro would ever build. Thereafter, renewable energy – maybe even tidal – would provide cheap, reliable power. But that was before CleanBC.

BC Hydro will release its next integrated resource plan in 2021 and it will include the crown corporation’s plans to satisfy the government’s climate ambitions. Until then, more dams are not off the table.

Wind and solar farms developed by independent power producers (IPPs) is an obvious solution, but the NDP commissioned the Zapped study last year that lambasted the BC Liberal government’s IPP policies. In June, the governing party introduced Bill 17 to amend the Clean Energy Act, clearing the way to seriously handicap the private producers. That bill was withdrawn pending further consultations, but there is a good chance it will be re-tabled with amendments in the near future.

Ralston is talking inexpensive renewables power from the Western United States, especially cheap solar from California, but congested transmission systems and investors eyeing up electricity-intensive industries like hydrogen production suggest the surplus isn’t secure as the government thinks.

This is why Site C matters so much to the bigger picture. If Premier John Horgan pushes CleanBC as hard as he has promised, there are no simple and easy sources for the vast quantities of power that may be required. With Site C turning into a quagmire, BC’s list of electricity generation options is getting shorter.

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