Province lagging on energy self sufficiency

By Andrew A. Duffy
Times Colonist (Victoria)
24-Feb-2006

According to Richard Neufeld, it's time to set the record straight on energy.

The provincial energy and mines minister told the B.C. Chamber of Commerce energy summit Thursday that the average British Columbian should understand the province is not as energy rich as people believe.

"The general public doesn't know that we don't have a surplus of electricity anymore and they also think we export huge amounts of our natural gas and oil to the U.S.," Neufeld said during a morning address to the two-day conference at the Ocean Pointe Resort.

Neufeld pointed out British Columbia has to import 12 per cent of its electricity and consumes five times the amount of oil it produces. And while he said the province does export 60 per cent of its natural gas, most of that goes to other areas of Canada.

During his speech he lauded the oil and gas industry for its growth over the last several years, touched on its bright future in various regions of the province and showed optimism that movement will be made on offshore exploration with a new federal government.

But he took the opportunity to drive home the message that industry and government need to band together in order for the province to become self-sufficient again, especially with B.C. Hydro estimating that the province will require an additional 30,000 gigawatt hours of electricity over the next 10 years.

Neufeld also sent out the message that new facilities are coming, though it won't be the provincial government paying the bill. "The message to the public is we're consuming more than we produce, and it's prudent that we generate the electricity that we consume domestically and to do that has consequences. That means something has to be built across the province," he told reporters following his speech.

While in the past that "something" might have meant Hydro undertaking a mega-project, Neufeld was singing from the 2002 Energy Plan songbook when he said the only projects Hydro can undertake in terms of energy production are on its existing sites or at the proposed Site C -- a $2 billion project that would see a 900 megawatt generating station on the Peace River in northern B.C.

Neufeld was extolling the virtues of independent power producers and their ability to come up with projects to satisfy the increased demand, noting a recent call from Hydro for 2,500 gigawatts of power resulted in 90 IPP proposals that would have netted 13,000 gigawatts.

The need for new power came as no surprise to the chamber which recently released a study of its members saying a reliable energy supply is crucial for economic prosperity. But chamber chairman Mike Bradshaw hinted the government may be short-sighted in not funding new generation itself through Hydro.

"It should have happened 10 years ago ... from an electricity standpoint we're already behind the eight ball," Bradshaw said. "We haven't built any new electricity resources in this province in 25 years."

Bradshaw pointed to the work of former Premier W.A.C. Bennett under whose direction the province built dams to harness the power of the Peace and Columbia rivers. "That was true vision ... we should have started developing new resources in the electricity sector 10 years ago.

The market was high -- high enough to support the gradual development of new resources that would have provided domestic security. But we haven't done anything," he said.

During an address to the summit later in the day, Jane Peverett president and CEO of the B.C. Transmission Corporation, also spoke of the need to invest in the system. She said residential demand is growing and the provincial economy is booming, placing strains on transmission infrastructure.

"It's time for us to start investing in the system. It's time because the system is reaching the end of its life and it's time because we have used up the excess capacity and demand continues to grow," Peverett said.

The average peak demand in B.C. has increased 21 per cent from 7,373 megawatts in 1990 to 9,317 megawatts in 2005, all the while the transmission system made up of 17,500 kilometres of power lines has expanded by only four per cent.

The BCTC has projected the need to spend $2.6 billion on the system over the next 10 years. That's $100 million annually on maintenance and between $100-$150 million on expansion.

More than $700 million is also being spent over the next three years as BCTC wants to upgrade the underwater transmission lines between Vancouver Island and the mainland as well as upgrading its computer systems.