Hydro to call for tenders for GSX replacement proposals
Posted on Friday, July 04 @ 20:29:01 PDT

By Andrew Costa
Citizen Staff

BC Hydro will likely issue a tender call sometime in the Fall for projects
to replace its proposed Georgia Strait Crossing (GSX) project and Duke Point
Energy Plant.

It suggested Monday issuing a call for tenders for proposals that would
render the $710-million Duke Point-Georgia Strait gas pipeline crossing
projects unnecessary.

Hydro says it still considers a gas-fired generation plant at Duke Point the
best solution to the Island's looming electricity shortfall but it told a
B.C. Utilities Commission hearing last week it is now prepared to yield to
alternative, private-sector projects - with one caveat.

Hydro power planning manager Mary Hemmingson made it clear the corporation
wants firm bids that address its standards for reliability, timeliness and
low-cost electricity.

Proponents of independent power projects have a major sales job ahead of
them if they hope to see their projects supplant the initiative Hydro has
already had under way for three years, she said.

"B.C. Hydro remains of the view that the VIGP (Vancouver Island Generation
Project) is the best alternative for its ratepayers," says the call for
tender proposal submitted to the commission for its consideration. "With the
large investment already made (approximately $100 million) in the
development, gas supply, siting and  regulatory events, it is unlikely that
other projects can be undertaken more economically than completing the
VIGP."

The province's single largest consumer of electricity, NorskeCanada, and
Terasen, its largest natural-gas distributor, are proposing alternatives
that they claim would be cheaper and cleaner than Hydro's plan and could be
delivered more quickly.

Norske proposes a mix of strategies including generating electricity at its
three Vancouver Island pulp mills and cutting its electricity consumption in
order to loosen up more supply for Island residents.

Terasen proposes to boost capacity of its existing gas pipeline, saying this
would render unnecessary the GSX gas pipeline Hydro proposes in cooperation
with Oklahoma-based Williams Pipeline Inc.

Arthur Caldicott, spokesperson for the GSX Concerned Citizens' Coalition,
which opposes GSX and the Duke Point plant, said a call for tender could be
good news for the coalition if Hydro is really serious about alternative
power generation proposals.

"It's been more or less agreed upon that Hydro will issue a call for tender
but Hydro says they don't have enough confidence that those projects are
fully developed enough," Caldicott said. "They're really throwing up big
hurdles for anyone to jump over so, the question is, are they simply
positioning things to make it really difficult for anyone else to get a
project in place?"

Those hurdles include conditions that the alternative generation projects be
up and running by 2006, and that they produce enough power to meet demand
well after 2009, he said.

Caldicott said he expects it will be difficult for NorskeCanada, Terasen or
another potential power producers to meet all of Hydro's requirements.

"What I expect will happen is they'll probably get a B.C. Utilities
Commission permit (to build the Duke Point plant) on the condition that they
issue a call for tenders," he said. "It's going to be difficult but if
Norske and Terasen have done all their due diligence they could end up
winning the day."

Hydro proposes to issue the call for tenders in mid-September. It wants a
certificate to build Duke Point, even if it does not elect to proceed.

"In the event that the CFT does not yield acceptable proposals for
sufficient and economic dependable capacity," the call for tenders states,
"B.C. Hydro would revert to the VIGP project."

With files from CanWest News Service

http://warmland.ca/modules.php?name=News&file=article&sid=1682