Hackney's Hearing Notes (Days 1-9)

Day 1, Jan 17, Monday
Day 2, Jan 18, Tuesday
Day 3, Jan 19, Wednesday
Day 3, Jan 19, Wednesday, in camera
Day 4, Jan 20, Thursday
Day 5, Jan 21, Friday
Day 6, Jan 22, Saturday
Day 9, Jan 27, Thursday

Hi all,

It seems I forgot to issue reports on the progress of the hearing for a couple of days.

Monday, GSXCCC filed its motion that the BCUC review Panel, Robert Hobbs and Lori Boychuk, disqualify itself on the grounds of apprehension of bias, i.e. that a reasonable person, apprised of the panel's words and actions around the in camera session on Wednesday, would conclude that the panel had made up and closed its mind about the outcome of the review.

The JIESC witness panel was also heard. Sheldon Fulton, energy expert, analyzed BC Hydro's data and concluded that the Duke Point Power plant would be dispatched much less than BC Hydro claims, due to its being relatively expensive and uncompetitive to run, and thus it would be more costly to ratepayers. Fulton also has an interesting idea that BC Hydro (and others) ought not to rely on gas price forecasts; rather they should rely on forward prices generated by the futures market (because the market "never lies").

Monday was the deadline for intervenors to file motions on the bias topic, and GSXCCC's motion was the only one filed.

Tuesday, there was no hearing, as parties consulted with their clients and prepared their responses to the GSXCCC disqualification motion.

Also, Tuesday evening, people unable to attend the hearing had the chance to respond to the motion. Half a dozen or so wrote in support.

Wednesday was entirely taken up with GSXCCC making its motion orally, intervenors speaking in support (8 or so, including Joint Industry Electr9city Steering Committee and others); and those against, (BC Hydro, Duke Point Power, Terasen Gas, VI); followed finally by GSXCCC's rebuttal.

Thursday, proceedings reconvened at 1:30. At that time, the Panel dismissed the GSXCCC motion for disqualification, with reasons to follow. Mr. Andrews made a motion asking that Mary Hemingsen of BCH be recalled to testify regarding the in camera meeting, including to confirm if indeed BC Hydro thinks that the DPP project before the commission is really not the most cost effective project, as seems to be the case.

Commission Panel dismissed this motion, too.

Next, GSXCCC brought up its witness panel: Steve Miller and Dr. Mark Jaccard.

Both, IMHO, were brilliant. Steve demonstrated several shortcomings and inconsistencies in BC Hydro's forecasting methodology, leading to and over-stated forecast. Cross-examination by Sanderson of BC Hydro failed to move him. In fact, at one point, Sanderson had to take a break to consult with his supporters because he didn't have the statistical depth to understand what Steve said.

Dr. Jaccard testified that BC Hydro's and DPP's ploy to put greenhoue gas liability off the table by having DPP take it all on might not work because GHG liability might attach to the fuel source itself, which is BC Hydro's responsiblity. Keogh of DPP cross-examined Jaccard for quite a long time, apparently trying to find weaknesses in Jaccard's experience or methods. He made no progress, as Jaccard is impressively experienced in all aspects of this, and hightly qualified and expresses himself very cogently. Keogh tried to offhandedly say that Jaccard's opinion of China's GHG plans was just an opinion, and Jaccard responded in detail with he extensive interactions with the Chinese, who are apparently making significant efforts to curb GHG and develop policies, even though they are not yet signatories to the Kyoto Protocol.

BC Hydro's rebuttal panel was sworn. It includes Dr. Pickel -- a rematch of Pickel vs. Fulton is thus in the offing, as they both appeared that the VIGP review. BC Hydro also called the head of the company that has the Henwood model for modelling fuel and electricity prices. This seems to indicate that BC Hydro is calling out the very big guns to try to counter the claim that DPP would not be dispatched much and would thus be a white elephant.

This panel will continue tomorrow.

It is expected that the hearing portion will be over on Friday, maybe in the morning.

After that, BC Hydro will presumably be called on to file its written argument. Then the written argument of intervenors. Dates not yet set. Then BC Hydro's rebuttal argument. The panel's committed decision date of 17 February still stands.

Summary of the current situation re the case against DPP, as seen by GSXCCC, et
al:

Cost:

$35 m per year for 25 years, just to have DPP ready to dispatch. On top of that, BC Hydro would have to pay for gas and operating costs to run the plant.

BC Hydro's cost modelling has been shown to be not reliable, since they are now second-guessing their own cost model that showed DPP without duct firing to be the "lowest cost" winner of the Call For Tenders.

North American gas supplies are in crisis now as conventional supplies dry up. The proposals to build LNG facilities all over the NA coast is a measure of the desperation of the situation. Not a good time to be committing to more reliance on gas.

Urgency:

Yakout Mansour, head of BCTC has confirmed that the October in-service date for the new cables is confidently expected to be October 2008. He has a fair amount of comfort that the old cables will be able to deliver 200 MW after the zero-rating date of 2007.

Steve Miller has exposed and continues to expose BC Hydro's pattern of padding the load forecast. His more conservative approach has knocked 90 MW off the forecast. While we don't minimize the risk of under-supply, there is also a real risk and cost with over-supply.

GHG emissions:

The public has spoken loud and clear: they are concerned about greenhouse gas emissions and want BC Hydro to work to reduce them.

BC Hydro claims it has passed off all liability to Duke Point Power; however, this does not address the public concerns, as there is no reason to believe DPP will offset the emissions. At the same time, the legal evasion may not even work, according to Dr. Jaccard's testimony. Carbon liability may attach to the gas supply itself, which is BC Hydro's responsibility.

Bias:

GSXCCC believes that a reasonable person, apprised of the facts would conclude that the Panel Chair has made up his mind on the outcome of the project in advance of having heard all the evidence. In addition, by not immediately informing all parties of significant new information about BC Hydro's second-guessing of its own cost analysis, the Panel Chair deprived the intervenors of the chance to cross-examing BC Hydro witnesses on this information.

CFT fairness:

Information, partly still held confidential, reveals that BC Hydro no longer believes that the DPP winner of the Call For Tenders is the most cost-effective solution to the energy problem, even though its cost assessment model picked DPP without duct firing. Now, for reasons not revealed, Hydro thinks a non-winning variant of DPP is more cost effective than the winner, and they have had discussions with the BCUC about how to overturn the CFT results and have the with-duct-firing alternative win. This calls into question the integrity of the whole CFT process.

I'm not sure what to do with the last point, as we aren't bidders ...

Tom Hackney,
Vancouver

Transcript: Jan 27, Thursday

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The day started quietly enough with the witness panel for Green Island Energy taking its seat in the witness stand. There were few questions and I expected it to be quickly over; however, intervenor Keith Steves came forward and instead of beginning a cross examination, expressed his outrage to the panel over the in camera meeting transcript. He brought a motion for reconsideration regarding the matters discussed in camera (I would have to review the transcript to determine the exact nature of the motion =-- it may not have accorded with normal legal procedure).

There was a considerable amount of discussion following. Bill Andrews for GSXCCC, BC SEA and SPEC, stood and gave notice that he would file a motion regarding the in camera proceedings. Several intervenors said they needed to consult their clients. Several said they were not sure what motion was going to be considered. Panel called a brief break, during which time the intervenors adversed in interest to BC Hydro and Duke Point came together and worked out an orderly approach. Which was:

Steves withdrew his motion to reconsider. Bill Andrews made a formal motion for the panel to be dismissed due to a reasonable apprehension of bias, with written reasons to follow. He also made a subsidiary motion for the hearing of evidence to be suspended on the grounds that it would be inherently wasteful of time (i.e. if the panel gets disqualified, there will need to be a new panel to rehear the whole case). Also that the witnesses would feel uncomfortable giving evidence under the circumstances in which there is a motion suggesting that the panel is biased.

Result:

Bill will file the motion in writing with reasons, deadline 4:30 Monday. Others who want to file similar or related motions around the same material should do so at the same time.

Intervenors who can't come Wednesday to argue regarding the motion(s) can do so electronically by Tuesday 8 p.m.

Intervenors who can come will orally address the motion(s) on Wednesday morning.

The GSXCCC witness panel will not be called before Thursday a.m. However, the JIESC panel will go, as scheduled, on Monday, as will the Commercial Energy Consumer panel.

We live in exciting times.

Tom Hackney
Vancouver

Transcript: Jan 22, Saturday
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Duke Point Power Project EPA review, Day 5, Friday, 21 January 2005

(some hot news!: see below)

Having disposed of the last of BC Hydro's four witness panels on Thursday, the BCUC Panel moved on to the evidence of the Duke Point Power witness panel. We finished the day with the BC Transmission Corporation witness panel and are now 1/2 day ahead of schedule. Because the intervenor witness panels were given over-generous time allotments, this means that we can expect the hearing to move substantially ahead of schedule. GSXCCC, et al's panel is quite likely to go on Monday, instead of starting Tuesday night. Witnesses, be ready.

Duke Point Power's witness panel consisted of Jeffry Myers of Calgary, former president of Westcoast Power, Inc.; Harvie Campell, of Calgary, former VP of Westcoast Power, also formerly VP of the ICP project in Campbell River; and Kenneth Spinner, former VP of New Ventures, Fletcher Challent Energy.

Some interesting points of testimony, larded with free enterprise comments designed to tell the BCUC panel that they were doing the right thing in supporting a CFT.

(a) Duke point power is not designed to take dual fuel (distillate), and it would be problematic for them to do so, technically and from the point of view of permits.

(b) Duke Point Power will have duct firing
capability, notwithstanding that the EPA has no contractual call for duct firing. Duct firing adds some 28 MW of capability to the plant, bringing it up to virtually the capacity of VIGP. In fact, from DPP's perspective, it is virtually the same project -- has to be because, as said yesterday, they anticipate using the same Environmental Certificate as the one granted for VIGP, and they anticipate only the formality of informing the government of a change of ownership, not a substantial change.

(c) BC Hydro scenarios for
supplying gas to DPP via barge, etc. were more or less confirmed to be theoretical, not plausible.

(d) DPP has consulted "extensively" with government
on the question of Greenhouse gas liability. We already knew DPP has assumed all the potential liability for this. This information on their research suggests that they were somewhat more prepared to face public discussion than was BC HYdro ; however the conclusion is problematic. GSXCCC cannot find any cost factor in the limited information available to us to indicate that any cost was assigned to potential GHG liability, and we think probably no cost was assigned. There is lots of political resistance to GHG liability at the federal level, with the government being extremely compliant to industry demands. Unfortunately, that means that industry can with some assurance ignore this issue. In the VIGP review, the BCUC commission had approved the notional amount of $3.60/MWh for GHG liabilty from gas fired generation, corresponding to $10/tonne CO2 offset cost. However, DPP was not even aware of this and did not consider it relevant to its cost calculations. Not only did DPP decline to say how much $ they had allowed for this, but they declined to indicate if they had allowed more or less than the BCUC had. And the COmmission chair backed up this confidentiality, refusing for the information even to be given to the BCUC in confidence. The policy implication is that the independent power producer's economic confidentiaily arguments will now become a screen to allow companies to completely ignore GHG issues, and the public will have no ability to discuss that potential downside to fossil fuel energy projects because BC Hydro will argue that they (and therefore the ratepayers) are off the hook for any liability.

In the break after DPP's panel, Chair Hobbs asked for some updates to BC Hydro's evidence that GSXCCC surmises indicates that he is working toward justifying a decision to approve the EPA. Specifically, he asked BC Hydro to update its various IR responses to take into account BC Hydro's version of the new Vancouver Island load balance, i.e. 284 MW in 2007/08. This is in advance of the GSXCCC expert testimony by Steve Miller on the appropriate load balance. In addition, as noted, Hobbs had declined to receive information about GHG potential cost, again in advance of GSXCCC's testimony by Dr. Jaccard on the subject. Not a good sign.

In the afternoon, BC Transmission Corporation brought its witness panel, consisting of Yakout Mansour, formerly of BC Hydro, now head of BCTC and another BCTC expert. The testimony was generally that the OCtober 2008 in-service date for the 230 kV cable system is confidently expected, and it could be earlier. This is considerably more optimistic than was testified to in the 2003 VIGP review. Similarly, Mansour is much more confident sounding about the longevity of the old HVDC system, coming much closer than before to saying that they could be relied on after 2007 (but he didn't go that far).

Duke Point Power spent a lot of time working to undermine the sense of certainty of the 230 kV cables. In my opinion they made little progress in this, and it became farily apparent that the 230 kV cables are progressing well. A possible exception is the development of opposition in Tsawassen, where people do not seem to be interested in an increased presence of high voltage lines crossing their community.

The most astonishing thing about the day was the circulation of the transcript of the "in camera" session of 19 January, i.e. Wednesday. This took place after the public testimony of BC Hydro panel 2.

The purpose of in camera proceedings, as I understand it, is to keep confidential certain commercially sensitive information of the EPA. The rationale (with which GSXCCC does not agree) is that the private interests must keep their critical pricing information secret in order to protect their competitiveness; however, the BCUC needs to review this in order to determine whether the public interest is served in approving the relevant contracts. That being the case, there is a need to receive some documents and information in confidence and, in some casese, there is a need to meet in camera to discuss that information.

But, there is still a commitment to let the public in on as much information as possible, so the approach taken in this case was for the meeting to happen in secret, but for a transcript to be published with the portions deleted that make reference to the commercially sensitive information.

What happened next was a comedy of errors. First, prior to going into to the "in camera" meeting, Chair Hobbs began discussing an issue with BC Hydro panel 2 in terms that did not allow other people in the room to know what they were talking about. However, Mary Hemingsen of BC Hydro dropped the phrase "you get 28 MW of capacity for a low price."

Then came the "in camera" session. Not really in camera, because the proceedings were published two days later; but a reading of that transcript quickly reveals two things: (a) at least some of the participants in the meeting are committing the theatrical error of forgetting that their remarks are on the record, and they speak as if the meeting is generally secret; (b) the purpose of the meeting is not at all to convey commercially sensitive information; rather it was used by Chair Hobbs as an opportunity to enter into a discussion -- almost a negotiation -- with BC Hydro counsel and BC Hydro panel 2 on how to arranged that a different project than the actual winner of the Call For Tenders should end up being approved.

To back up for a second, the terms of the Call For Tenders require that the portfolio that was assessed by the Quantitiaive Evaluaton Methodology to be the least cost must be called the winner, and must get the Electricity Purchase Agreement. The term "project" in this context means one of five "portfolios":
(i) Duke Point Power without duct firing; (ii) Duke point power with duct firing; (iii) some VIGP-like competitor without duct firing; (iv) same VIGP-like competitor with duct firing; (v) Duke point power assessed along with a small peaker project (if I recall correctly). The winner of the CFT is #(i), Duke point power without duct firing.

Now do some mental arithmetic. Duke Point Power Project without duct firing has won the CFT; however Duke Pont Power will build with duct firing capability. Mary Hemmingsen mentioed "you get 28 MW of capacity for a low price". The MW difference between Duke point with and without is 28 MW. There is no other capacity addition under discussion in this proceeding of 28 MW.

Now let's return to the subject matter under discussion in the "in camera" session, and recall that this was Wedneday, before all the BC Hydro evidence had been heard and before any intervenor panel had been heard. Recall also that JIESC planned to bring in an expert on gas and electricity prices, GSXCCC plans to bring evidence on the VI load gap and the liability of GHG emissions; etc.

Throw in a quote from Chair Hobbs at the beginninig of the "in camera" session: "So you know now what I want to try to do. I need your help in telling me how I can get there." (transcript 1742)

Tr. 1751 Hemingsen: "I agree that we all have a concern that it didn't produce the cost effective -- the most cost effective outcome in terms of what was bid in. That was a bit of a trade-off in the simplification of the mode."

Tr. 1753: The Chairman: "What occurs to me, Mr. Sanderson, that -- it may not be breaching confidence for the disclosure of the fact that there is a bid that is optimal for customers than [sic] the winning bid ..."

The "FACT" that there is a bid that is optimal -- i.e. the decision has been made in advance of all the relevant evidence.

At the least, this calls for some explanation.

It is not clear at the moment what GSXCCC or other intervenors will do in response. Expect more news later.

Tom Hackney
Vancouver

Transcript: Jan 21, Friday

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Panel 4 addressed the BC Hydro load forecast and the cost effectiveness modelling.

Ken Tiedemann is BC Hydro's load forecaster. Mary Hemingsen led the panel, having had over-all responsiblity for the CFT and related matters.

JIESC cross examination started off trying to address why the relative cost of a power plant like Duke Point Power, whose cost has embedded in it a fixed cost of $35 million per year just to be available to provide capacity (before it even starts to run -- this comes to a net present value of $300 million or so for 25 years of this cost) should be so similar in BC Hydro's calculations to purchasing energy on the BC mainland for the same period with no capacity cost or using a combination of Green Island, a small 47 MW peaker and some Norske load shedding. There is a lot of mystery in BC Hydro's numbers, and, we suspect, a big fudge factor in the BC Hydro assumptions of what the price would be to buy energy from other sources instead of from DPP. Intuitively, it's very hard to see how a power plant whose rate structure is oriented toward addressing a capacity problem that only lasts a year or two (i.e. the sub-sea cable supply problem) could be cost competitive when 23 of its 25 year contract term requires energy rather than capacity. I do not believe the JIESC cross examination got to the bottom of this, as the BC Hydro witnesses had a great deal of complicated material to explain, thus allowing them wiggle room to not reveal the point. However, we can expect some smart, well-financed intervenors to come forward with some alternative cost calculations in the argument phase.

Green Island attempted to continue pursuing the question of the disqualification of the Elk Falls peaker bid, but with limited success because that issue was not seen by the Panel to be relevant to Panel 4.

All things considered, I did not think a lot was accomplished in terms of eliciting information useful to the intervenors -- but I may need to qualify this later, depending what use people make of the highly technical nature of some of the information. At the core is a highly complex issue of how and why BC Hydro did the cost analysis and what significance it will have in the review. BC Hydro started off saying that satisfying the terms of the CFT should be the only thing at issue. The Commission disagreed, saying that the BC Hydro cost analysis and the most cost effective alternative thereof was key. However, BC Hydro's cost effectiveness analysis was not designed or intended to be a real portfolio comparison and the alternatives to "Tier 1" (i.e. Duke Point Power) are relatively arbitrary selections from the bidders (Tier 2 has Green Island and a peaker plant, but not the disqualified peaker plant -- why?). The No Award alternative makes some sense: i.e. what happens if there is no award, but Tier 2 is very arbitrary. And there is some analysis of the use of portable peaker generators that are mounted on trucks -- not bid into the process or analyzed at all. Meanwhile, the methodology BC Hydro has used is, in Hydro's terms, intended to make a rough check in case there is some big, overarching issue to be addressed that was not captured in the CFT -- i.e. not meant to be a fine analysis of relative merits of different portfolios.

So part of the discussion is around picking holes in the BC Hydro methods and analysis, but part of it is going to be in asking the Commission to give more weight to this analysis than to the CFT result (which, after all, has produced a clearcut answer: Duke Point Power)

All the signs point to the hearing going more swiftly than expected. Panel 4 is set to be finished early, and people generally do not expect the intervenor panels to take nearly as long as they have been scheduled for, especially as we do not expect to be allowed "sweetheart" cross-examination, so there will only be BC Hydro and Duke Point and the Commission itself to cross a lot of the panels, and they may well, for strategic reasons, not want to ask much. GSXCCC was given an entire day for its two witnesses. (We see this as a strategem by Panel Chair Hobbs to crowd us in our cross-examination of the BC Hydro panels).

Tom Hackney
Vancouver

Transcript: Jan 20, Thursday
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Transcript: Jan 19, Wednesday - In Camera

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Conclusion of the cross examination of panel 2. Cross examination of Panel 3 regarding mostly the integrity of the CFT process, as seen by the Price Waterhouse Cooper perspective.

From panel 2 was elicited the facts that: (a) to be dual fuel, the gas turbine has to be the right type -- not practical to modify the wrong type after the fact. It does not look as if DPP is for dual fuel or can easily be made so. It looks is if BC Hydro people made some ill considered IR responses suggesting that this might be employed in the event of trouble getting enough gas from Terasen. Similarly (b), it was testified that LNG could be supplied to DPP via a pipeline from a ship, not requiring a terminal. Not sure how often deliveries would have to happen or how much gas would end up in storage; nevertheless, BC Hydro claims it is a practical alternative to getting a deal with Terasen. More realistically, BC Hydro can go to the BCUC and virtually force a gas supply deal of some kind with Terasen.

Panel Member Boychuk asked about GHG liability and BC Hydro's pathetic ($0 Net Present Value) undertaking to offset half the GHG emissions to 2010.

Panel Chair Hobbs indulged in a freewheeling discusson with the panel about DPP's contribution to system-wide energy and capacity needs, which some took as an indication that he is thinking ahead to approval.

Gold River and Green Island and the Commercial Energy consumers spent a lot of time trying to show that the process was unfair. Evidence has shown that BC Hydro has indeed taken the fuel price risk on for gas projects, and that this is a benefit making it easier for gas projects to bid; however they staunchly maintain that this is not unfair. It's an okay "bias". Price Waterhouse Coopers agrees -- the point of the bidding process is not to level the playing field for all, but rather for the rules to be clear to all and followed through consistently.

Contrary to the direct testimony of Mary Hemingsen and Bev Van Ruyven, some evidence was brought out by counsel for GSXCCC et al, Bill Andrews, to the effect that BC Hydro had discretion to allow or reject the non-complying bid of the Calpine peaker plant at Elk Falls. This will doubless be confirmed or refuted or qualified in the next couple of days, with the arrival of further information as to how much BC Hydro really had in rejecting the Calpine bid. For now, it makes some of the BC Hydro testimony look bad. The significant implication is that BC Hydro may not have been compelled to reject the Calpine bid. If that bid had been accepted, the Ladysmith peaker and the Green Island project could have been aggregated with Calpine to form an acceptable portfolio, which might have competed with DPP. As it turned out, BC Hydro "was forced" to reject the Calpine bid for havng submitted a "conditional bid"; thus Green Island and Ladysmith peaker didn't get into a competing portfolio and were effectively eliminated from the race.

There was a credible buzz in the halls during one of the breaks today that there is recent political interest in being flexible on DPP, more than there was a month ago. Does this mean cabinet might step in and order BC Hydro to stop DPP, or for some subtle behind-the-scenes pressure on either BC Hydro or the BCUC? I don't really know how the policial sector would intervene, given the Liberal's frequent promise to put BC Hydro under the oversight of the BC Utilities Commission, but government is the boss, and it would find a way if it really wanted to. SO, keep up the letters to politicians.

Tom Hackney
Vancouver

Transcript: Jan 19, Wednesday

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This day was reserved for Panel 2, led by Mary Hemmingsen, with Rohan Soulsby, Steve Eckert, Graeme Simpson, Chris O'Riley.

The panel seemed very defensive, especially on a couple of issues: once again the question of whether DPPP is justifiable as a long-term contracted facility; and whether the VIGP bidders got a sweet deal with the $50m VIGP assets; also on whether the gas-fuelled bidders got a sweet deal with BC Hydro agreeing to allow the option to the bidder of whether or not to take the gas supply risk. It seems very obvious that BCH offering to do this constitutes a benefit to gas bidders, biases the process in their favour; however, Panel 2 was very unwilling to acknowledge it, even though they said the small peaker plants would not have been able to bid in without that clause.

Green Island and Gold River went after this point hard, and, I thought, really established how heavily this favoured gas-fired power, with the attendant risk going to BCH ratepayers (risk of long-term gas price increase, that is, shorter term price risk is, in principle, mitigated by the size of the BCH portfolio). They also spent a lot of time establishing that the Calpine peaker at Elk Falls was unfairly and inappropriately (in their view) eliminated from the process, and that their elimination caused the Green Island project not to be considered in a portfolio to meet the supply gap, thus effectively eliminating Green Island's bid.

Bill Andrews scored solidly on whether the $50 m VIGP assets deal was mischaracterized as market rate, when it should have been called sunk cost.

GSXCCC, et al. emphasized the $88m Net Present Value of GHG gas liability that is built into the VIGP benchmark -- but BC Hydro doesn't want to admit that lack of this factor in the DPP price might explain its relatively cheap stated cost.

GSXCCC also uncovered a significant fact on the Environmental Certificate:

DPP has no plans to transfer the Certificate from VIGP to DPPP because Duke Point Power expects, through the EPA terms, to purchase Vancouver Island Energy Corporation from BC Hydro. Thus, as I understand it, "Duke Point Power Project" is "Vancouver Island Generation Project" already, though not known by that name.

What this means is that there will be no transfer of the Certificate. However, we should be writing to the Minister and the EAO to inform them that we expect there to be significant change to the Certificate, and that we want input into it.

DPPP is not designed to be dual fuel, and some changes would be required to make it so. However, it looks as if it is to be dispatched differently, which should affect the air emissions. More starts and stops, which could lead to more bursts of start-up pollution. I don't know how significant this is. Overall, it looks as if our position on the Environmental Certificate is weaker.

Tom Hackney
rainy Vancouver

Transcript: Jan 18, Tuesday

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Report from the BCUC hearing room.

Today was the first day of the BCUC hearing into BC Hydro's electricity purchase agreement with Duke Point Power.

BC Hydro started off saying that they only expected the review to address the CFT terms, and that the BCUC has expanded that to consider comparative costs of DPP with "Tier 2" and No Award.

BC Hydro witnesses emphasized over and over again that there is a threat of a shortfall on the Island. Cross-examined on the long-term economics, they showed some slippage between the necessary capacity argument for DPP and the proposition that DPP is supposedly going to be a useful and economic addition.

Under cross by Green Island, they admitted that they might go before the Commission in the future to ask for a rate increase to cover GHG offsets (in line with CEO Bob Elton's remarks). However contradictorily they also say that DPP is responsible for GHG liability.

Hearings going each day this week and Saturday. Resuming for five days next week.

Hobbs still says he will issue a decision on the 17th.

Next ... Panel 2 continued.

Tom Hackney

Transcript: Jan 17, Monday

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