Gas plants are here to stay

Nanaimo News Bulletin
24 August 2004
Opinion

Many people probably breathed a sigh of relief when the B.C. Utilities Commission ordered B.C. Hydro to find alternatives to its natural gas-powered generation plant at Duke Point.

Advocates of greener solutions might have hoped that someone, somewhere might offer a more environmentally friendly option to another smoke-belching gas-powered plant.

Sadly, of the six projects that proceeded to tender, non-burning options are lacking, and natural gas is the fuel of choice for five of the six options.

The sixth option, put forward by Green Island Energy Ltd., is for a biomass facility at Gold River. B.C. Hydro isn't releasing details of the project to indicate just how green it might be.

The outcome should surprise no one. The utilities commission only ordered the review because it wasn't convinced B.C. Hydro had done due diligence in making sure the gas plant at Duke Point was the cheapest for ratepayers.

The outcome, however, has made a mockery of the goal of financial prudence. B.C. Hydro has been forced to write off considerable costs from the Duke Point project, including $50 million for environmental approval costs, $61 million for a gas and steam turbine and $9 million for the property at Duke Point. There is a chance the assets can be resold, but if they're not sold at cost it's another cash giveaway from B.C. Hydro stakeholders - us, in other words.

So it should be no surprise that the projects put forward look remarkably similar to the one shelved by B.C. Hydro, including EPCOR's proposal for a 255-megawatt gas plant at Duke Point. If there are savings from having a private business build the plant, it will be interesting to see how much will be a result of the decreased costs for environmental approval, given the groundwork laid by B.C. Hydro.

In other words, the savings are dubious, the overall costs are likely to be higher and the costs to be borne by B.C. Hydro clients. Welcome to the better way, courtesy of the B.C. Utilities Commission.

- News Bulletin editorial board

Nanaimo Bulletin