GSX Concerned Citizens Coalition
Comment on BC Hydro's announcement that the VIGP application to BC Utilities Commission is deferred.
January 16, 2003

Energy and Mines Minister Richard Neufeld confirmed a few times in December that BC Hydro would submit an application to the BC Utilities Commission (BCUC) for a Certificate of Public Convenience and Necessity (CPCN) for the proposed Vancouver Island Generation Project (VIGP).  

 

But he always made those statements with the qualifier that if VIGP were sold to an Independent Power Producer (IPP), then BCUC would not review the project.

 

Having been thwarted for three years now with the lack of candour from BC Hydro, GSX Concerned Citizens Coaltion (GSXCCC) have been concerned that a way would be found to avoid subjecting VIGP to a BCUC assessment.

 

There are two possibilities with this news release from BC Hydro.  One is, that they are cooking up an arrangement to circumvent a BCUC review of VIGP.  The other, the brighter possibility, is that these new power proposals will provide BC Hydro a way to put VIGP gracefully.  Unfortunately, the news release appears to kill this possibility in its last paragraph: "When BC Hydro moves forward with VIGP, it will submit an application to the BCUC for a CPCN".

 

GSXCCC have filed evidence with the National Energy Board, that demonstrates that the power from VIGP is not necessary to meet peak demand on Vancouver Island until at least 2007, giving us time to discuss and plan for more sustainable energy solutions than Hydro is presently able to envision. 

 

Notwithstanding this evidence, if BC Hydro is discovering sources of power that do not require VIGP, then on the face of it, this is probably a good thing.  An alternative that involves burning coal or used tires, however, will face strong opposition. 

 

If, on the other hand, they are concocting a deal whereby an IPP takes over VIGP, we would want to examine that deal closely.  A private investor will be interested in VIGP if two things are guaranteed them: 1. all regulatory barriers are out of the way, and 2. the return on investment is assured.  That is, BC Hydro would have to guarantee a supply of gas, and commit to buying the power.

 

In the end, one way or another all the economic risks of VIGP would be underwritted by BC Hydro, and that means that we, the electricity users of British Columbia, would be picking up the tab.  This is no alternative, it's just a deceit.

 

The NEB's Short Term Deliverability Report, published in December 2002, makes it abundantly clear that the Western Canadian Sedimentary Basin is moving into an era of declining production.  GSX and VIGP would enter a marketplace as a very small player bidding against much bigger competitors for the remaining gas.