Jury still out on plant's savings

Editorial Board
Nanaimo News Bulletin
10 Nov 2004

Back in September, 2003 B.C. Hydro went before the B.C. Utilities Commission seeking permission to build a natural gas power plant at Duke Point.

The request was denied on the basis that B.C. Hydro had not demonstrated the power plant was the most cost-effective way to generate power.

As a result B.C. Hydro issued a call for tenders. A number of companies responded, with one - a proposal by Pristine Power Inc. - being chosen.

To no one's surprise, the proposal is for a natural gas power plant at Duke Point. So we're back to square one with a private company building it instead.

For anyone who believes that the private sector can do better than a government agency, here is an apples-to-apples comparison - except for the small print. The Pristine Power Inc. facility will indeed be cheaper to build, but that's thanks almost certainly to the groundwork already laid by B.C. Hydro.

The corporation was 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.

If so, are the savings real? That is, will Vancouver Island be assured of electricity as cheap or cheaper than it would under the B.C. Hydro proposal?

Hopefully the utility commission that started this whole process will end it with good news for hydro customers - news that also takes into consideration the $120 million in writedowns. If not, there's a very real chance all the utilities commission did was create paperwork and put the future of the Island's electricity in private instead of public hands.

That's an odd directive of a commission that (to the best of our knowledge) was never given that mandate.

News Bulletin editorial board

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