Market News

 April 06, 2009
British Columbia's Troubled Waters

 British Columbia has been recognized globally as a leader with respect to climate change.  The government has implemented many measures to reduce greenhouse gas emissions and to promote development of green energy alternatives.

Some decisions have been contentious - such as the universal carbon tax, which under any circumstances carries political risks. Other measures, such as committing the province to energy self-sufficiency by 2016 and developing 90 per cent of its energy from renewable sources such as run of river projects were greeted favourably - at least until now.

Run of river (i.e. small scale hydro developments) were a key part of the government’s 2007 Energy Plan, and B.C. Hydro, the province’s energy utility, was quick to issue calls for renewable energy for proposals from independent power producers (IPPs) based on commitments to buy energy from approved projects under long-term contracts that provided price certainty at no risk to consumers. It was argued private sector players could offer wide-ranging expertise and cost advantages that the larger public utility could not.

But the initial support for zero-emission run-of-river hydro projects has soured, dividing environmental groups, prompting widespread protest meetings, and helped to elevate "the environment" as a core issue in the upcoming provincial election.

There are many reasons for the change in public attitudes, not the least of which is the lack of a generally accepted process for multi-party consultations on such projects and the growing size of some of the "small scale" hydro projects.

B.C. has enjoyed relatively cheap "green" electricity for decades, in large part due to a network of giant dams on the Peace and Columbia rivers built when environmental sensitivities were less a concern. But population growth and increased energy demands have made the province a net energy importer.

Given public resistance to further large dam projects, the opportunity to expand energy supply from environmentally benign or ’green’ sources - i.e. run of river projects, wind farms or waste to energy facilities seemed to be a ’win-win’ solution.

But while the scale of environmental and social impacts may be far less than those associated with mega dams, trees do get cut down, scenic vistas are changed and new power lines require access roads and cleared rights of way. Some would argue this is a small price to pay for energy solutions that help to lower greenhouse gas emissions and promote energy self sufficiency. But the willingness to accept such trade offs is not widely shared.

Most of the rivers that have been tapped for hydro use to date are in remote areas and have sparked little controversy, i.e. "out of sight, out of mind". Even small micro-scale projects close to urban centres generally have not sparked negative community reaction.

But larger run of river projects, such as the proposed development by Plutonic Energy and General Electric in Bute Inlet have run into severe opposition.  That project involves 17 sites, each of which requires construction of a powerhouse, a flooded area ranging from soccer field size to much larger containment areas, and river diversions of anywhere from two to nine kilometres. In total the project will require 300 kilometres of new or improved roads and 450 kilometres of new power lines. That’s too much of an impact, according to some.

A year ago over 1200 people rallied at the local High School in Pitt Meadows to protest a similar project involving a network of run of river sites. This negative public reaction led B.C. Environment Minister Barry Penner to deny certain permits that effectively killed the project.

Since then, several advocacy groups have been formed to protect the over 700 B.C. river eco-systems purportedly under siege by private power developments seeking to cash in on what some environmentalists call "an uncoordinated energy gold rush". Protest meetings were held on Vancouver Island last week and various citizens groups and political parties have called for a moratorium on independent power projects until a new province wide Integrated Sustainable Energy Planning process is put in place.

Several First Nations have expressed concerns that environmentalists do not appreciate the economic importance of small hydro energy projects to their communities. The close bonds between aboriginal groups and environmentalists, once united in common cause to protect the environment, have been strained. The Klahoose and Sechelt First Nations are calling on six groups, including the Western Canada Wilderness Committee, COPE 378 and BC Citizens for Public Power, to respect rather than attack them for support of projects such as Plutonic Power’s cluster of run-of-river stations in Toba Inlet, according to an article in today’s Vancouver Sun.

"We have been struck by the profound ignorance, paternalistic behaviour and outright dismissal of our rights and title by your organizations, their leaders and their representatives," leaders of the first nations say in a letter sent to six environmental groups last month recently obtained by The Vancouver Sun.

The intensity of the debate and the amount of misinformation cramming the media and on-line list servers prompted the B.C. Ministry of Energy, Mines and Petroleum Resources to issue a statement of Facts on Independent Power Production on March 25th “to correct misleading claims about electricity generation in British Columbia.”

With specific reference to the “energy gold rush” and the assertion that hundreds of run-of-river IPPs existed, that statement noted that as of year-end 2008 only 88 IPP licenses had been issued and only 47 IPP projects were operating in the province. Of these, 15 had been generating green electricity for over 10 years.

Environmental groups face a bit of a dilemma over the growing opposition to run of river projects, which they have championed for years as the kind of green alternative B.C. needs to keep the cheap energy flowing. Even famed environmentalist David Suzuki went public recently to ease tensions that have split the environmental movement.

Studies comparing low-carbon electricity generation technologies confirm that run of river projects produce the lowest life cycle carbon footprint of all and zero greenhouse gas emissions.

This is basic science, notes University of Victoria’s Andrew Weaver, a lead author for the Nobel Prize-winning Intergovernmental Panel on Climate Change. But some environmental groups have chosen to abandon science and campaign against clean energy and climate policies, he notes.

In a guest column to the Vancouver Sun earlier this year he stated “The public dialogue is riddled with outlandish and demonstrably false assertions such as windmills will devastate local bird populations or a hydro project will create more greenhouse emissions than it will displace by eliminating a coal-burning power plant. Some of the most insidious arguments attempt to slow things down: That we should do more planning, that we should do energy conservation first and build renewable energy later, that we shouldn’t do anything until China does.”

“These arguments are fundamentally not serious”, he notes, “They come from groups and spokespeople that have simply not grappled with the math -- with the scale and speed at which we must eliminate fossil fuel emissions.”

The speed with which B.C. Hydro is proceeding with the review and approval of run of river projects, and concerns that many have about the openness of the approval process is part of the problem compounding an already troubled situation with respect to the province’s rivers.

More openness might be part of the solution, but as Professor Weaver notes that does not eliminate the need to get on with the job of moving toward carbon neutrality if we hope to preserve our well-being.

B.C.’s troubled waters may calm down after the next election, but until then the issue is likely to remain politically charged and highly polarized.

For More Information: Globe and Mail
Source 2: Vancouver Sun