LTAP: MEMPR "clarifies intention" on Burrard Thermal

COMMENT: This puts the boots to BCUC's decision on the LTAP.

The Clean Power Call is in! And BC Hydro now has to acquire even more energy by 2016 than it anticipated in the 2008 LTAP - happy day for IPPs.

PROVINCE ADVANCES COMMITMENT TO CLEAN, RENEWABLE ENERGY

VICTORIA – As part of its commitment to reduce greenhouse gases and become a clean energy powerhouse, the Province has clarified its intention to the British Columbia Utilities Commission (BCUC) to end BC Hydro’s reliance on the Burrard Thermal Generating Facility for energy needs. The decision was announced today by Blair Lekstrom, Minister of Energy, Mines and Petroleum Resources.

“We’ve been committed since 2001 to ending BC Hydro’s reliance on Burrard and to only using it for emergency back-up capacity,” said Lekstrom. “In B.C, we have the opportunity to develop clean, renewable, cost-effective electricity with virtually no greenhouse gas emissions. That will also improve air quality in the Lower Mainland.”

BC Hydro has been planning to reduce its reliance on Burrard, as proposed in its recent Long Term Acquisition Plan, to help meet the legislative target to reduce greenhouse gas emissions by six per cent by 2012, 18 per cent by 2016, and 33 per cent by 2020. Today’s direction is consistent with the government’s Climate Action Plan, BC Energy Plan, and the Utilities Commission Act.

Effective immediately Burrard will no longer be used for planning purposes for firm energy. It will only be used for up to 900 megawatts of emergency capacity.

“In providing this direction, BC Hydro will replace the firm energy supply from Burrard Thermal with clean, renewable and cost-effective energy,” said Lekstrom. “Ending our reliance on energy from Burrard Thermal for planning purposes is also a critical component of B.C.'s greenhouse gas reduction strategy.”

Burrard will no longer be relied upon for energy but will continue to be available to provide emergency back-up power in the event of generation or transmission outages, which is a benefit to British Columbians. Typically, Burrard’s actual operation is less than 10 per cent of what it is capable of generating per year.

Clean and renewable energy continues to be a cornerstone of British Columbia’s climate action plan that will create jobs, support families and generate new economic activity throughout British Columbia. BC Hydro has been upholding that plan. Electricity self-sufficiency and clean and renewable power generation are integral to B.C.’s effort to reduce its carbon footprint and fight global warming.

This decision will also allow BC Hydro to continue to acquire 6,000 GWh of cost-effective, clean and renewable power. This includes up to 5,000 GWh from the Clean Call and up to 1,000 GWh from Phase 2 Bioenergy Call for Power.

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Contact:
Jake Jacobs
Public Affairs Officer
Ministry of Energy, Mines and Petroleum Resources
250 952-0628
250 213-6934 (cell)

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B.C. government orders Burrard Thermal writeoff

The aging Burrard Thermal generating plant. (Photograph by: Ian Lindsay, Vancouver Sun files)

VANCOUVER — The British Columbia government has written off the aging Burrard Thermal generating plant as a reliable source of electricity.

Energy Minister Blair Lekstrom announced late Wednesday that BC Hydro can no longer include the 50-year-old, gas-fired plant on its roster of power generating facilities.

At full operation, Burrard is one of the largest sources of greenhouse gas in the province, but has been increasingly relegated by BC Hydro to a role backing up the province's sprawling network of hydroelectric facilities — due to its age and the relatively high cost of natural gas.

However, despite limited use Hydro has been listing Burrard on its books as part of its primary electricity supply.

That policy effectively diminished the amount of new, private sector power development deemed necessary to enable Hydro to reach its government-mandated target of making B.C. electricity self-sufficient by 2016.

The policy helped minimize the rate increases that are necessary to cover the cost of development of new power generation.

But it also cramped the government's plans to expand private power development in hopes of creating enough surplus power for expanded export sales to the United States and Alberta.

In an interview, Hydro vice-president Bev Van Ruyven said Thursday that Hydro is now 6,000 gigawatt hours per year short of the generating capacity needed to meet the self-sufficiency target and is now looking at its options for hitting the government's target on schedule.

Hydro has a number of options including a pending deal with Teck Cominco for expanded power supply from private generating facilities in southeast B.C., development of a new biomass-powered generation sector — and expanding its call for green power generation bids.

ssimpson@vancouversun.com

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Burrard Thermal goes to back burner

VICTORIA – Energy Minister Blair Lekstrom has made good on his promise to order the shutdown of Burrard Thermal in Port Moody, BC Hydro's largest fossil fuel electricity generation facility.

Lekstrom has directed the B.C. Utilities Commission that effective immediately, Burrard Thermal will no longer be used in BC Hydro's energy supply plans, and will only fire its natural gas boilers for up to 900 megawatts of emergency power.

One emergency scenario is an ice storm such as one that brought down power lines across much of Quebec in 1998, Lekstrom said.

Lekstrom promised the action in late July after the utilities commission rejected parts of the government's energy plan and advised BC Hydro it should count the capacity of the aging facility in its plans.

"This is about clarifying our position as government," Lekstrom said. "We were very clear going back to 1996, Burrard Thermal was not in the future plans in British Columbia. We think that it has lived its life cycle. We believe that as we move forward into clean, renewable energy opportunities in British Columbia, we're blessed with a diversity of that opportunity. Burrard is not part of that."

B.C.'s Independent Power Producers Association applauded the government's move.

"Reducing our reliance on Burrard will reduce greenhouse gas emissions, improve air quality in the Lower Mainland and grow B.C.'s economy through the development of new renewable energy sources," said Harvie Campbell, chairman of the association.

Lekstrom said the decision to override the utilities commission on use of Burrard Thermal does not diminish its authority to protect the public interest in electricity rate and expansion decisions. Its mandate from the government is to approve "clean, affordable power" and keep electricity rates in B.C. among the lowest on the continent, he said.

BC Hydro has spent $8.7 billion since 2001 on projects to expand its dams and electricity grid. The Crown-owned utility is also studying the Site C dam project, a third dam on the Peace River that has been under consideration for 30 years.

Premier Gordon Campbell has repeatedly vowed that BC Hydro's dams and other heritage assets will remain publicly owned, and that if Site C is constructed it too will be owned and operated by BC Hydro.

Government clears way for greener power expansion

BC Hydro should focus on sources of clean, renewable, cost-effective electricity, minister says

The British Columbia government has ordered BC Hydro to yank the aging Burrard Thermal generating plant off its roster of baseline electricity sources.

The decision throws open the doors to a significant expansion of private-sector power development, and sparked a fresh round of debate Thursday among private power supporters and opponents.

The decision, which came in the form of a special Cabinet directive to the B.C. Utilities Commission, forces Hydro to accelerate power-acquisition plans established to meet B.C.'s goal of being electricity self-sufficient by 2016.

Hydro is now looking to add 6,000 gigawatts per year of new electricity supply -- enough power for 600,000 homes.

At full operation, Burrard is one of the largest sources of greenhouse gas emissions in the province.

In practical terms, the 50-year-old gas-fired plant located along the Port Moody Arm of Burrard Inlet is serving only a nominal backup role for the province's sprawling network of hydroelectric facilities.

But Hydro has been listing Burrard on its books as part of its primary electricity supply -- thus dampening the amount of new private-sector power necessary to meet the government-mandated self-sufficiency target.

Energy Minister Blair Lekstrom said in an interview on Thursday that the government wants Hydro to focus on sources of clean, renewable and cost-effective electricity.

"Burrard is antiquated technology in an airshed that is pretty difficult to manage," Lekstrom said. "When we think about the air quality, running this just doesn't make sense."

Lekstrom said Hydro will seek 1,000 gigawatt hours of power through development of a biomass-burning sector, and a further 5,000 gigawatt hours from Hydro in-house development and private-sector projects.

But he added that the government won't accept bids from private power developers unless the electricity they offer is reasonably priced.

"At the end of the day, this is about affordable electricity for British Columbians. I'm not a supporter of buying electricity at any cost. I think I've made that clear since I've been in this portfolio."

Hydro vice president Bev Van Ruyven said the Crown corporation is now looking at its options for hitting the government's target on schedule.

Hydro is already in the midst of a clean power call that attracted 17,000 gigawatt hours' worth of bids -- although Hydro had previously stated it would only contract for 2,000 GWh after scrutinizing bids and accounting for attrition.

"Going forward, if Burrard is not in our planning stack, we now have a gap that we need to fill to meet the self-sufficiency goal in 2016," said Van Ruyven.

She added that Hydro is reviewing the government's order and will have a better idea of its options in about 10 days.

Hydro has a number of options, including Hydro in-house projects that upgrade and expand generation from the Crown corporation's own "heritage"
hydroelectric facilities including Mica and Revelstoke.

David Austin, B.C. electricity sector commentator and legal counsel for some power producers, agreed with the decision on Burrard.

"Finally, Burrard is being recognized as the industrial relic that it is, and subject to seeing the fine print [in the government's announcement], is being unconditionally and absolutely relegated to the role of last-resort use. It isn't being junked, but pastured for infrequent use like cold snaps or major equipment failures."

Harvie Campbell, chair of the Independent Power Producers Association of B.C., said the decision gives the industry the certainty it was lacking last summer after the BCUC made a controversial ruling that Hydro should increase the amount of power supply it keeps on the books for Burrard -- in order to minimize the impact upon ratepayers of adding new power supply.

The cabinet directive effectively overturns the BCUC's ruling.

"The most important aspect of this directive, for the industry, is that it constitutes concrete action," Campbell said. "The financial community was watching. They were concerned it had taken us this long to get where we are."

Campbell said both Hydro and industry will have to address the high attrition rate -- about 30 per cent -- among private power bids previously accepted by Hydro in order to help the Crown corporation reach its self-sufficiency target.

"That is not a criticism of anyone. It underlines the need for the IPP community to work more closely with BC Hydro in fashioning acquisition processes that will work."

Donald McInnes, CEO and vice-chair of Plutonic Power, said the government's order "has given BC Hydro and the utilities commission the tools required to allow BC Hydro to go out and procure further energy."

Port Moody Mayor Joe Trasolini said Burrard pays the city about $1.4 million per year in grants and royalties in lieu of taxes.

He said the directive will cost the city about $200,000 a year in lost royalty revenue -- equivalent to a 0.75-per-cent property tax increase to residents.

Aaron Hill, an ecologist with Watershed Watch Salmon Society, said it "makes sense" to minimize B.C.'s reliance on fossil fuel for electricity supply.

"But rather than rushing to dam and divert B.C. rivers and streams for hydro power, much of which is likely to be exported to California, we should be making energy efficiency and conservation our number one priority."

Tzeporah Berman, executive director of PowerUP Canada, noted that 75 per cent of B.C.'s total energy consumption is fossil fuel, so "direction from the government that opens the way for more wind farms and other clean energy projects is good news."

"If we are going to reduce global warming pollution and create new clean economy jobs in B.C., this kind of clarity is critical," Berman said.

Melissa Davis, executive director of BC Citizens for Public Power, said the Burrard order "is simply a way for the government to continue to manufacture an energy crisis and justify the need for private power production -- under the guise of acting as a solution to climate change."

ssimpson@vancouversun.com

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