Vancouver Sun received a letter from a concerned citizen yesterday, which may well reflect the concerns of a lot of people within reach of run-of-river projects.
Instead of going out on a limb myself, I’ve asked the minds at Plutonic Power Corp. (TSX: PCC) for their take. In green are excerpts from the letter to the editor:
“What kind of planning got us to go from selling a surplus of clean hydroelectric power to importing a shortfall of 18 per cent (mostly dirty) power? Are we crisis scrambling with ill-conceived projects like “run of river”?
The majority of BC’s hydroelectric assets were built in the 60s/70s and BC had a surplus of energy up until approximately 2001, which is when the province started to become a net importer of energy. Various issues were at play during this time, a lack of new major asset construction and the unknown of energy demand growth. That being said, IPPs, in particular run-of-river projects are not new to BC and have been in existence for more than 20 years, under both this current government and the previous government’s regime. Today’s IPP projects do not get permitted and built without extensive planning and oversight - more than 50 permits and licenses and 77 conditions are placed on Plutonic’s projects to ensure all requirements of our environmental certificate are met. Our projects also have extensive wildlife, fish and hydrology studies completed to ensure proper siting as well as exhaustive stakeholder engagement and gaining support and consent from First Nations.
“Most of these generating stations are of such Mickey Mouse 5-20 megawatt capacity that you have to screw up 40 to 50 pristine wilderness rivers to get the equivalent of one average (big base load) power plant: Burrard Thermal Generating Plant, 950 Mw; Peace River Site C, 900 Mw.”
In order to meet the projected demand for energy, anticipated to grow by 45% in the next ten years, we will need to look at a balanced portfolio of resource options including run-of-river, wind, biomass, large Hydro and of course conservation. As we are a net importer now, IPPs are an excellent immediate solution given that construction timelines are exponentially shorter than large hydro, and natural gas has been precluded from being built in BC as all new energy sources must be GHG neutral according to the BC energy plan.
“We give away over 400 small river water rights to contractors, then guarantee them long-term contracts to buy back the high-priced power with tax dollars. That should really impress us taxpayer/voters when our electrical rates double. Then we hack and slash hundreds of new (small load) power transmission lines through sensitive parks and wilderness areas.”
We aren’t exactly sure where the myth that rivers are being given away came from - but it is ridiculous. Water licenses obtained by IPPs are rentals with a finite life of 40 years after which they are returned to the province and developers must reapply for them. Annual taxes, fees and levies are connected to these licenses payable to the province as well. The long-term contracts are with BC Hydro as the sole purchaser of the energy, so the power is for the benefit of BC at a locked in price for the term of the contract. What critics fail to share when touting this argument is that imported energy is volatile from a price and availability perspective and that with current labour and construction costs, any new energy built in BC will cost more, regardless of who builds it, BC Hydro or the private sector. Why not allow the private sector to take on the risk associated with site selection, study, financing and development to protect the ratepayers long term?
