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BC Hydro looks to hydro, gas units to service LNG, mining projects

Rodney White, Platts, 29May2012

Washington -- Faced with "considerable" increases in electricity demand caused in large measure by pending LNG and mining projects, British Columbia's BC Hydro suggested Monday it may have to use more natural gas to produce power.

"BC Hydro's load profile is changing," the utility said in its Integrated Resource Plan. "New mining and oil and gas development in northern BC is creating new load centers in the province, potentially driving the need for additional energy and capacity in areas of the province where they didn't exist before."

The utility expects to need 1,100 MW by 2021 and another 1,300 MW by 2031, it said in the plan.

The utility is considering the possibility of building "additional clean energy resources" that would be "backed up by gas-fired generation" and available by 2019.

It plans to build a 1,100-MW hydro-electric dam and a 500-MW peaking unit as well as buy power off the wholesale market to meet rising demand.

If all the expansions occur, the plan said the utility will need to generate an additional 4,900 GWh of firm energy and 1,100 MW of peak capacity in the next 10 years.

Several companies are currently working to establish LNG export facilities on the province's northwest coastline, creating a potential investment of about C$20 billion in BC and the addition of many new jobs, the plan said.

"The provincial government has said it is committed to seeing three LNG plants in operation by 2020," the plan said. "Related provincial goals include ensuring BC is competitive in the global LNG market, maintaining leadership on climate change and clean energy, and keeping energy rates affordable."

A Shell-led consortium announced plans May 15 to build two trains to process 12 million mt/year. Meanwhile, the rival Apache-operated Kitimat LNG project and the BC LNG Export Co-operative project have already the regulatory approvals and export permits in hand for terminals near the Kitimat deepwater port on the northern British Columbia coast.

"If a third LNG facility is approved and requests electrical service, BC Hydro would need to acquire significant additional energy and provide additional peak capacity to serve the additional load," the plan said. "BC Hydro is studying a range of options to serve this potential future need on the north coast, involving both electricity supply and associated transmission infrastructure."

The utility, which serves 1.8 million customers, is owned by the British Columbia Ministry of Energy, Mines and Petroleum Resources. The utility operates 30 hydroelectric facilities and three gas-fired power plants.

--Rodney White,
--Edited by Keiron Greenhalgh,


Reviewing the Draft Integrated Resource Plan, BC Hydro

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