Gordon Campbell's green dream meets the new world
COMMENT: More basically silly analysis on energy issues from the mainstream media.
1. 3,000 or 5,000 gigawatt-hours, not gigawatts
2. 3,000 GWh would, on average, be enough to power 200,000 homes, but not EVs as well
3. BC Hydro predicts some 30% attrition from the call, so they really only expect to get 2,100 GWh.
4. This is not BC Hydro versus the government: The government gave BC Hydro and the Utilities Commission some very clear instructions to pursue energy conservation before new supply, and this is what Hydro is doing. Yes, there is somewhat of an inbuilt conflict between the idea of having a green IPP industry and maximizing conservation.
5. A really big problem with developing the IPP industry is high costs. Conservation is much cheaper. The spot market is generally cheaper. On top of that, the IPP industry has been hit by construction costs and financing difficulties (on top of the government's decision to force coal projects to capture carbon), such that Hydro now expects the 2006 Call winners only to deliver some 2,300 GWh/yr, a 67% attrition rate from the 7,100 GWh that was awarded. 2,033 GWh/y is attributable to the coal plants. If those are excluded from the calculation, attrition is 55% after signing EPAs with Hydro, due to the variety of financing, construction and in some cases fuel supply problems.
So, yes the green industry is in trouble, but it's due to a lot more than a decision by BC Hydro.
Tom Hackney, Policy Chair
BC Sustainable Energy Association
(250) 381-4463
thackney@shaw.ca
www.bcsea.org
By Miro Cernetig
Vancouver Sun
January 7, 2009
Premier Gordon Campbell's dream of making Vancouver, and British Columbia, a continental hub of green-power generation may be short-circuited -- by one of his government's own Crown corporations.
BC Hydro wants to cut its future demand for new, renewable power by a whopping 40 per cent. Instead of ordering up 5,000 gigawatts of new, green energy by 2016, the utility now says it needs to put out a "call" for only 3,000 gigawatts of green power.
This green power reduction -- enough electrons to power approximately 200,000 households and tens of thousands of electric cars -- is somewhat of a shock on political and economic fronts.
First, it means big trouble for the business plans of all those B.C. companies that want to build wind turbine farms, put up solar power panels or construct micro-dams for so-called run-of-river hydro projects. BC Hydro, in a report quietly filed with the B.C. Utilities Commission a few days before Christmas, is essentially anticipating a 40-per-cent cut in the province's future green electricity.
A few months ago, when BC Hydro made its call for that renewable power, it attracted 68 proposals, promising up to 17,000 gigawatts of new power a year. Now, if Hydro gets its way, this emerging sector -- which the B.C. government sees as a rising industry -- will see a deep cut in its domestic market. Only a handful of the proposals would likely survive.
This may delight some environmentalists. Although they don't generate greenhouse gases, many wind projects and run-of-the-river schemes are seen as despoilers of virgin wilderness.
But their demise, or delay for a decade or more, will come at a cost to the provincial economy, too.
The green-power industry says its proposals to create 5,000 gigawatts of new power by 2016 represent about $5 billion in investment and 4,500 years of employment -- not inconsequential in a period when the province's economy is turning down. That investment and employment will be almost cut in half if the B.C. Utilities Commission approves Hydro's plans for a reduction.
BC Hydro has put together a carefully considered argument for delaying its green-power needs. In a 100-page submission to the commission, it says higher prices for electricity passed on to its customers, along with conservation measures, will mean energy savings and reduced consumption.
It also offers up a rather bleak -- but realistic -- assessment of the province's economy. BC Hydro forecasts "a general forecast slowdown in economic activity over the next 24 months. This slowdown is due to a decline in the global and domestic demand for commodities and materials and the impacts of the financial and credit crisis."
There is a glimmer of hope in the document -- though it won't manifest itself until 2011 or so. "This downturn is," Hydro estimates, "not expected to be structural. That is, after the current slowdown, the rate of economic growth is expected to resume."
BC Hydro's bean-counters and power analysts have reams of documents to rationalize this policy reversal. It's probably a prudent bottom-line decision from a bottom-line perspective.
But it raises larger political issues. The question now being hotly debated within the Campbell government, which has staked its future on being a leader on renewable energy, is whether the utility is being short-sighted and hurting the government's long-term economic strategy.
Remember, Premier Campbell has staked his reputation on making B.C. a leader in reducing its carbon footprint. He has promised plentiful green power will also present a competitive advantage in a future when carbon emissions are a liability. Plentiful green power is part of the premier's 21st-century industrial strategy.
The premier's green dream is in danger of being seriously downscaled. The question for the B.C. Utilities Commission, which has the power to green-light or re-reject Hydro's plans, is who it thinks has the best bead on the future.
© Copyright (c) The Vancouver Sun
Posted by Arthur Caldicott on 08 Jan 2009