BC Hydro abandons Duke Point Power Project

June 17, 2005

Continued appeals force BC Hydro to abandon Duke Point Power Project

"Risk of project not being ready on time now too great"

VANCOUVER – BC Hydro today announced it is abandoning the proposed Duke Point Power Project because the continuing appeal process means the risk is too great the plant will not be built in time. This follows the decision on Tuesday by the B.C. Court of Appeal to hear an appeal of the project by a number of intervenors.

"Our priority throughout has been the reliability of electricity supply to our customers on Vancouver Island and the risks to that are now too great," said Bev Van Ruyven, BC Hydro Senior Vice President, Distribution. "Given that, we have decided to exit from the project, something we are able to do as part of our contract with Duke Point Power without any additional cost."

Canceling the project does come with reliability of supply implications. This is, however, something that will be focused on from both a short and longer term perspective.

"From a short term reliability perspective, we need to ensure that there will be enough supply on Vancouver Island until the new transmission line comes in," added Van Ruyven. "We will do that by trying to extend the life of the current transmission cable and making load curtailment arrangements with industrial customers that may be needed between 2007 and when a new transmission lines comes into service."

"For the longer term, we will look at how the next call for new energy supply to the private sector needs to be adjusted to take into consideration today's decision. As well, we will use the upcoming second round of our Integrated Electricity Planning workshops to discuss – particularly on Vancouver Island – how our next portfolio of resources can take into consideration today's decision. This will get us more input to help make a decision."

In making this decision, BC Hydro would like to recognize all the efforts of DPP throughout the last year.

"DPP has been very professional throughout this process," concluded Van Ruyven. "We hope we will be able to work with them again in the future."

Contact:
Stephen Bruyneel
Director, Corporate Communications and Public Affairs
Phone: 604 623-4344
stephen.bruyneel@bchydro.com

BC Hydro news release

Notice to BCUC to Terminate EPA
BC Hydro remains committed to supplying its customers on Vancouver Island with reliable cost-effective electricity. To that end it will begin to plan the implementation of short-term contingency options to secure additional reliability through to the in-service date of the proposed 230 kV transmission project. These options will be implemented sequentially to respond to the most current supply-demand forecasts. They include a load curtailment arrangement with Norske Skog, and perhaps other industrial customers, and temporary generation, if and when needed. Under current assumptions BC Hydro anticipates a one-year gap in its ability to meet the N- 1 planning criteria. However, it need not commit to that course of action until the in-service date for the 230 kV project becomes more certain. If BC Hydro concludes that the one-year gap is appropriate in the circumstances, it wil bring the matter forward to the Commission.

The most immediate consequence of the decision to terminate the EPA is that BC Hydro is obliged to reconsider the evidence it had planned to file Wednesday in support of the F2006 call for energy described in the 2005 REAP. Fundamental issues of the F2006 call, including quantity, timing and terms and conditions, all require reconsideration by BC Hydro in light of its termination of the EPA.