Overruling utilities regulator puts Campbell in tricky spot

Robert Matas
Globe and Mail
August 26, 2009

"It's critical that we restore the independence of the utilities commission to properly do its job on behalf of utilities and consumers alike without political interference. We intend to do that." Gordon Campbell, as opposition leader in November, 2000

The B.C. government chipped away at the independence of the British Columbia Utilities Commission this week, announcing its intention to overrule a decision rejecting BC Hydro plans that included downgrading the Burrard generating plant.

The government initiative announced in yesterday's Throne Speech revives one of the most hotly debated issues in the recent provincial election campaign - private hydroelectric projects - and raises questions about the government's commitment to ensuring that the utilities regulator remains free of political interference.

The Burrard Generating Station is a conventional thermal plant fuelled by natural gas that provides power at peak times, such as last year's harsh winter storm. Reflecting government policy on greenhouse-gas emissions and energy self-sufficiency, BC Hydro had proposed scaling back reliance on the Burrard plant and shifting energy production to privately produced green power projects, such as independent run-of-river, wind power and biomass projects. Run-of-river projects involve diversion of water from streams through a powerhouse and then back into the river.

Some environmentalists have raised concerns about the impact of the projects on the streams, fish and habitat, while others have supported the projects as green alternatives to large-scale dams.

The utilities commission rejected the long-term plans after concluding that BC Hydro had inflated its demand for private power by underestimating how much electricity the Burrard plant could provide.

Energy Minister Blair Lekstrom said yesterday the government is not compromising the independence of the utilities commission by directing it to endorse the phasing out of the Burrard plant. The government has said "for some time" that the Burrard plant was not in its plan for clean renewable energy development, he said in an interview. The government intends to issue a directive to the commission on where the government is heading on the matter, he said. "If it was not clear enough for them before, it certainly will be following this directive that Burrard Thermal is not part of our future, in terms of electricity generation."

He dismissed a suggestion that the direction was political interference. "This is about clearing up something we thought was very clear," he said.

The B.C. government has issued directions to the utilities commission on four previous occasions since the Liberals succeeded the NDP in 2001.

John Horgan, the NDP energy critic, said the initiative contradicts comments by Premier Gordon Campbell in November, 2000, to Canadian Institute of Energy. "He made so much noise and brayed so loudly about non-interference with the regulator," Mr. Horgan said. "[Mr.] Campbell has now decided interference with the independence of the commission is okay. It is a result of [the commission] not giving the answer that he wanted to hear in July," he said.

Mr. Horgan called on the government to set out evidence that contradicts the utilities commission's findings. "Show me why you are better informed than the commission and I may agree. But they have not done that, they have not presented any evidence," Mr. Horgan said

rmatas@globeandmail.com

Utilities watchdog gets choke chain

The Burrard Thermal plant is unknown to many B.C. residents.

Tucked away on the north shore of Burrard Inlet, it’s part of a little outpost of the dirty energy industry that West Coast folks tend to associate with Alberta. Imperial Oil’s Ioco refinery was dismantled and sold in 1995, six years after the nearby IPSCO steel mill went cold for the last time. (Yes, B.C. was once a steel producer, or at least a recycler.)

Yellow piles of sulfur extracted from natural gas, some oil tanks and pipelines and the six boiler stacks of the gas-fired Burrard Thermal station are the main remnants of this industrial history seen by commuters on the Barnet Highway, as it winds its way into East Hastings Street.

In what may be its last loud bark, consumer watchdog B.C. Utilities Commission has said Burrard Thermal should fire up four of its six old boilers to help meet growing electricity demand. As one would expect, the NDP and its anti-environmentalist pals were ecstatic. It’s the death knell for Gordon Campbell’s “pirate power” scheme, they crowed.

The commission’s decision, a book-length broth of acronyms that only a lawyer could love, rejects parts of the B.C. Liberal energy plan. But it seems contradictory at times.

Self-sufficiency in electricity is a fine goal, they say, which is why the outmoded, 35-per-cent efficient Burrard Thermal kettle should be brought to boil. It’s also a valuable backup, so it shouldn’t be phased out by
2015 as B.C. Hydro intends. (It can either be a primary source or a backup source, but not both.)

Elsewhere, the commissioners admit they don’t expect B.C. Hydro will actually, you know, run the old smog factory flat out. Commissioners are sensitive to the “social licence” of government in this matter, which one insider explained to me is “code for riots in the streets.” They say Hydro would likely end up importing dirty power instead of making it.

I caught up with Energy Minister Blair Lekstrom in his hometown of Dawson Creek, where he was presiding over the opening of B.C.’s first commercial wind energy project. (That would be one of those pirate power schemes we don’t need.) With the BCUC now under orders to revise its energy forecast, I asked him, can they overrule the government on private power, or anything else? The short answer seems to be no.

“They’ll continue to play a very important role in British Columbia, I can tell you that,” Lekstrom said. “We want to make sure that, you know, if the direction that was given wasn’t clear enough on Burrard Thermal, we’re evaluating that.”

Compared to the BCUC, Lekstrom is clear enough. The old watchdog has been sitting on the porch for so long that its barking doesn’t make sense any more. No need for a one-way trip to the vet, just a choke chain and maybe some nice medication to help it sleep away its autumn years.

Environment Minister Barry Penner is less diplomatic than Lekstrom. In addition to being B.C.’s point man on greenhouse gas emissions, he is the MLA for Chilliwack-Hope, the area that would collect most of the pollution from Burrard Thermal. This was all debated in great scientific detail during the successful fight to stop Sumas Energy 2, a Washington state project that would have been twice as efficient as Burrard.

“The people I have talked to can’t believe it,” Penner said when I asked him about Burrard Thermal.

Oddly, the BCUC went along with B.C. Hydro’s current position that those newfangled plug-in cars are just a flash in the pan.

Here boy, here’s a nice cookie.

Tom Fletcher is legislative reporter and columnist for Black Press and BCLocalnews.com.

tfletcher@blackpress.ca