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BC Hydro predicts that our province's power demand will grow to 50 per cent more than current usage over the next two decades, though these numbers are notoriously hard to forecast. "They depend on economic growth rates and decisions about resource development that are beyond Hydro's control. So the key thing is to have a flexible plan in the face of uncertainty. In general, BC Hydro does a pretty good job with this," says environmental economist Mark Jaccard of Simon Fraser University.
Up to 66 per cent of this increase in demand is expected to be soaked up by improving energy efficiency and reducing usage according to BC Hydro — a target that many academics, including Jaccard, consider highly optimistic. That leaves a large shortfall that has to come from somewhere, and, given current government policy, has to come from a "green" resource (B.C. is currently in the enviable position of having 93 per cent of its electricity coming from renewable, low-emissions sources, compared to about 20 per cent globally).
"If we're not going to burn fossil fuels, our options are fairly few. Run of river is one of the few things we have in abundance," says Wendy Palen, an ecologist at Simon Fraser University who is studying the impact of IPPs.
Nigel Protter, head of the BC Sustainable Energy Association, a local Pembertonian and long-time consultant for IPPs in the region, agrees. Solar simply isn't economic for electricity in B.C., he says. "Wind and hydro are both excellent least-worst options" when it comes to collateral damage on the environment, he says. "It's not a case of either/or. We need everything we can get."
In 2002, the BC Liberal government responded to the projected energy shortfall by putting out a call for energy production from private companies — whether that came from biomass burning or wind or hydropower. The result was a "gold rush" on B.C.'s rivers. As of 2012, some 1,100 applications had been submitted for water licenses to explore the possibility of power production on various creeks and rivers. These are "run of river" or "river diversion" projects, where a large percentage of a river's water is diverted through pipes, and the pressure is used to produce power. The water is returned to the river lower down.
There are about 45 operational run-of-river IPPs in B.C., with 34 more approved but not yet producing power. About a fifth of these are in the Sea to Sky region. When asked about their current view of IPPs, a spokesman for the Ministry of Energy, Mines, and Natural Gas said: "We are committed to working with the Clean Energy sector to ensure that there remain significant opportunities for renewable energy companies to provide power to British Columbians."
The approved projects include several high-profile efforts, including a 106.7MW Innergex run-of-river project on the Upper Lillooet River and North Creek, around 60 km northwest of Pemberton — which still aims to start construction this autumn, despite a speed bump in June when it was denied a "temporary use" permit from the regional district, needed for some of the building work.
This project, too, has the capacity to impact a local landmark, reducing the water going over Keyhole Falls to as little as one-fifth of normal flow in summer (there won't be any other visual impacts on the falls, Innergex promises, and access to the Pebble Creek Hot Springs will be maintained).
There is also a large project on the Holmes River in northern British Columbia, consisting of 10 sites each producing less than 15 MW along 40 kilometres of river. This effort has attracted attention because the company has been given a reprieve from the more stringent environmental assessment required for projects of over 50MW. Environmental groups recently took the effort to court, arguing that the project should be considered as one giant whole, but the B.C. Supreme Court disagreed in a May 18 ruling stating that it did not need to be treated as a single large-scale entity.
There has been much debate about whether B.C. really needs all the energy it has commissioned, and whether it comes at too high a price. The companies that develop IPPs have fixed long-term contracts with BC Hydro — the original goal was to commission enough to make B.C. self-sufficient even in a low-water year. In the short term, this can produce a surplus of power. Meanwhile, cheaper electricity supplies have emerged from elsewhere, thanks to a decline in U.S. demand following the 2008 financial collapse, and a surge in unconventional fossil fuel supplies (particularly natural gas from hydraulic fracturing — a technique that can access vast supplies of gas trapped inside hard rock, but which has fuelled controversy about possible contamination of drinking water supplies).
This has left BC Hydro paying through the teeth for power from the IPPs — by some calculations it has spent hundreds of millions of dollars more than if it had bought the electricity on the open market. The BC New Democratic Party put out a press release in February 2013 saying this had cost BC Hydro $300 million in 2013. Many — including BC NDP leader Adrian Dix, economist Erik Andersen, political commentator Rafe Mair, and local protestors such as farmer Louise Ludlam-Taylor — fear massive debts for BC Hydro and large rate increases for electricity customers.
"If people understood what all this is going to do to our rates, there would be more than four people here protesting," said Ludlam-Taylor, one of Pemberton's fiercest opponents to IPPs, at a small protest outside an Innergex job fair for the Upper Lillooet project in June.
In the long term, says Protter, British Columbians may be grateful for a stable, local, green energy supply to meet all their needs, built by private companies that can shoulder the risk of new power projects better than a public concern.
Jaccard has noted that electricity rates are bound to increase regardless of where we get our new power from, since new installations of any kind will be more expensive than legacy systems. On his blog he recently wrote: "throughout the world, new supplies of electricity cost more. In British Columbia, some increase in electricity rates is inevitable as we blend new higher-cost supplies with the low-cost power from our hydropower legacy."
Those who argue that BC Hydro's public projects produce cheaper power than IPPs are ignoring the enormous losses incurred in projects like BC Hydro's Duke Point natural gas facility, Jaccard says. "Comparing IPP power to BC Hydro power — as the NDP wanted to do — is an unfair comparison," he says.
After two big calls for independent power projects, today there is a lull in B.C. while formerly approved projects get built. Right now there is a standing invitation from BC Hydro for smaller power plants of under 15MW, but no immediate plans for another big energy call. This could change.
There have also been protests against the proposed 900MW 'Site C' hydroelectric project that would dam the Peace River, flooding more than 5,000 hectares of land.
If this proposed project falls through in the next year or two, then BC Hydro will have to go elsewhere to make up that power — presumably with a new call for projects including run-of-river.
In anticipation of such calls, companies continue to explore their options in the Sea to Sky. Innergex and its subsidiaries alone are looking at the possibility of hydropower on a long list of well-known creeks in the region, including Callaghan Creek, Joffre, Owl, Twin One, Lizzie and Ipsoot. Maps showing applications for water licenses are peppered with dots — most densely in the area between the Sea to Sky and the Sunshine Coast. Any project takes years to move from application for a water license, through to having a license to investigate, applying for a permit and going through public consultations and environmental assessments, before a decision is made about whether it will be built.
The Lil'wat Nation, which has not taken a general position on IPPs, but instead considers them on a case-by-case basis, has a handful of projects on its table right now at various stages of this process.