BC Hydro awards EPAs: media

Independents win B.C. Hydro contracts
Fiona Anderson, Vancouver Sun, 28-Jul-2006

New power projects to boost rates
Jeff Rud and Terri Theodore, Times Colonist, 28-Jul-2006

Independents win B.C. Hydro contracts

CREDIT: Vancouver Sun, Handout photo
Gordon M. Shrum Generating Station at W.A.C. Bennett Dam.

BC Hydro has agreed to buy more than 7,000 gigawatt hours of power from independent producers in an effort to end the province's reliance on imported electricity.

British Columbia currently consumes about 55,000 GWh of electricity, 10 per cent to 12 per cent of which it imports, B.C. Minister of Energy, Mines and Petroleum Resources Richard Neufeld told a press conference Thursday when the new power contracts were announced.

That consumption is expected to increase by 31,000 GWh in 20 years, and BC Hydro will be looking to independent power producers to supply that incremental power, Neufeld said. Independent producers currently supply about 10 per cent of the province's electricity.

Thirty-eight projects ranging in size from a 1,612-GWh-per-year coal and biomass project in Tumbler Ridge to the four-GWh per-year Eldorado Reservoir hydroelectric project near Kelowna were promised energy purchase agreements by BC Hydro. Under the agreements, BC Hydro promises to buy the electricity at a fixed rate, enabling the companies to obtain the financing to proceed with the projects. The companies are required to be producing electricity by 2010 and the agreements, on average, will be for 30-year terms.

The bulk of the projects are run-of-river hydro, which creates electricity by diverting water from a river, dropping it through a turbine and returning it to the river. The other projects use wind, biomass, waste heat and a coal and biomass mix to generate electricity. Almost three-quarters of the projects are "B.C. clean," under the province's clean electricity guidelines, BC Hydro said.

If all are successfully completed, the projects will produce enough electricity to meet the needs of more than 700,000 homes. The projects will also bring between $3.6 billion and $4 billion of investment into the province as well as "an awful lot of jobs," Neufeld said.

BC Hydro made an open call for power last December, seeking 2,500 GWh of electricity. Fifty-three separate projects were submitted and evaluated based on a number of criteria, including reliability of the resource, proven technology and competitive pricing.

To keep up with growing demand, BC Hydro will be making a call for an additional 5,000 GWh this fall and another 2,500 GWh next year, Neufeld said.

In addition to the independent projects, BC Hydro also agreed to buy 226 GWh from the Brilliant Expansion Project on the Kootenay River, which is partly owned by Columbia Power Corp., a Crown corporation.

Site C, BC Hydro's controversial proposed dam project on the Peace River near Fort St. John, does not seem to be on the province's electricity agenda though Neufeld said it was still on the books.

"Site C continues to be an option amongst an awful lot of options across the province of British Columbia and that's where it remains," Neufeld said.

But with such an overwhelming response to BC Hydro's call for power projects "there is the possibility ... that we can meet the needs of British Columbians in a different way," he added.

BC Hydro president and CEO Bob Elton said the proposed projects would "help meet the electricity needs of British Columbia for 30 years to come, at least."

"Three-quarters of this energy is BC clean energy which ... means we're well-positioned to keep having not only the lowest rates in North America but also the cleanest power in North America, not just now and not just for five years, but for many years."

The Independent Power Producers Association of B.C. is "delighted" by the number and size of contracts awarded, president Steve Davis said in an interview.

"It has the potential to double the size of the IPP industry," Davis said.

fionaanderson@png.canwest.com

This story can be heard online after 10:30 a.m. today at www.vancouversun.com/readaloud.

POWER PLAY

BC Hydro on Thursday awarded contracts to 38 independent power producers (IPPs) which would draw upon a variety of energy sources.

WATER

Number of projects: 29

Gigawatt hours per year: 2,853

COAL/BIOMASS

Number of projects: 2

Gigawatt hours per year: 2,033

BIOMASS

Number of projects: 2

Gigawatt hours per year: 1,186

WIND

Number of projects: 3

Gigawatt hours per year: 980

WASTE HEAT*

Number of projects: 2

Gigawatt hours per year: 75

*using waste heat from WestCoast Energy Inc.'s compressor stations

7,000

Potential gigawatt hours per year from projects

700,000

Number of homes that would power

$3.6 billion

Amount of private sector investment projects would generate

© The Vancouver Sun 2006

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New power projects to boost rates

B.C. Hydro's move to plug into 38 new independent power projects around the province, including a major one in Gold River, means consumers will have to dig deeper to pay for their power.

The projects, announced Thursday, will include power generated from wind, water, coal and waste from wood, construction material and even municipal landfills.

Gold River is to be the site of a new biomass thermal combustion power plant. The project by Green Island Energy Ltd. was among contracts awarded by B.C. Hydro that will see more than 7,000 gigawatt hours of energy a year added to the system by 2010. That's enough to supply 700,000 homes.

The projects will bring between $3.6 billion and $4 billion of investment into the province as well as "an awful lot of jobs," said Energy Minister Richard Neufeld.

The downside for consumers will be the extra cost. "New generation is obviously going to cost money. You don't get it for nothing. So obviously there will be some rate increases," said Neufeld. Despite those increases, power will still be a good deal in B.C. "Your hydro bill is the third-lowest in North America," Neufeld said.

New Democrat MLA Guy Gentner (Delta North) argued the government's privatization agenda was the problem, saying customers wouldn't be paying more if private companies weren't involved. Environmentalists criticized the inclusion of coal plants. "The burning of coal is a primary contributor to global climate change," said Guy Dauncey of the B.C. Sustainable Energy Association.

The Gold River plant is the second-largest of the new private projects. It will have a capacity of 90 megawatts and produce energy totalling 745 gigawatt hours a year. The largest will be a coal-biomass project at Tumbler Ridge. It will have a capacity of 184 megawatts and produce 1,612 gigawatt hours a year.

Gold River's plant will be built through rehabilitation and expansion of the existing power plant at the former Bowater pulp mill, which closed in 1999. Green Island Energy will operate the plant. The company is a Vancouver-based consortium of Canadian and U.S. investors, including Lenedra Jewel Carroll, the mother of pop star Jewel.

Sean Ebnet, Green Island project manager, said the plant should be running by the fall of 2008, when it will employ 55 to 60 workers. Cost of the project has been rumoured at $250 million. Ebnet would only say "it's probably over that.''

Hydro spokeswoman Elisha Moreno said the plant will be designed to accommodate a wide range of biomass fuels including hog fuel, urban woodwaste, construction and demolition materials, land-clearing debris and presorted municipal solid waste.

B.C. imports about 10 per cent of its power and the goal is to make the province energy self-sufficient over the next decade, as well as to meet growing demand for power.

Hydro is promising to buy electricity from the power producers at a fixed rate, enabling the companies to obtain financing to proceed with the projects.

The bulk of the projects are run-of-river hydro, which creates electricity by diverting water from a river, dropping it through a turbine and returning it to the river. Almost three-quarters of the projects are "B.C. clean," under the province's clean electricity guidelines, B.C. Hydro said. Most of B.C.'s existing power supply is generated through hydro.

Hydro CEO Bob Elton said the independent producers, in the long term, will help address the lack of power generating capacity on the Island.

"They are all good things that will help,'' Elton said. "But I think the most important thing is the transmission lines get built.'' The Island Transmission Project, which will see the replacement of aging power lines that link the Island to the mainland electricity grid, was given approval by the B.C. Utilities Commission earlier this month but is still awaiting environmental clearance.

© Times Colonist (Victoria) 2006

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