Today in the house I rose in question period to ask the government once more about the economics of the Site C dam project in light of recent revelations. Since elected I’ve continued to point out the economic folly of moving forward with Site C at this time. I’ve expressed concerns on the effect it will have on our credit rating; I’ve pointed out that there are cheaper alternatives like wind or geothermal which would allow supply to keep pace with demand. I’ve also called on the government to broaden BC Hydro’s scope to allow for production of geothermal power.
Earlier this week Emma Gilchrist, Executive Director of DeSmogBlog Canada, authored a two part series on the economic justification for the Site C project. The two articles were based on an extensive interview she had with Harry Swain, former co-chair of the federal-provincial Site C review panel:
Below is the text of my exchange with the Minister of Energy Mines. Our press release is reproduced at the end of this post.
A. Weaver: Earlier this week Harry Swain, co-chair of the joint review panel appointed for the Site C dam and a former Deputy Minister of Industry Canada and Indian and Northern Affairs Canada, raised some very serious concerns about the government’s approach to approving Site C. Mr. Swain was very clear that the government was rushed in approving Site C, and British Columbians will pay for their haste. As Mr. Swain said: “Wisdom would have been waiting for two, three, four years to see whether the projections they” — that’s B.C. Hydro — “were making had any basis in fact.” That’s not exactly a glowing endorsement for the fiscal underpinning of Site C.
The review panel predicted that by building it now, Site C will actually produce more electricity than we’ll need for the first four years, costing taxpayers $800 million. My goodness, we could use that money to build a state-of-the-art sewage system in Victoria.
Mr. Swain is only the most recent person to suggest waiting a few years to see if electricity demand for the project materializes. We could still build Site C down the road if necessary, but we could use the additional time to properly explore cheaper alternatives like our vast geothermal potential in B.C. We have the time. LNG final investment decisions are delayed or not happening at all or somewhere down the yellow brick road or perhaps in never-never land.
My question to the Minister of Energy and Mines is this. Given the massive costs associated with rushing into Site C, will he hit the pause button on construction for two to four years, as recommended by Mr. Swain, and use the time to save British Columbians money and explore viable alternatives?
Hon. B. Bennett: I will answer the question. I categorically disagree with the premise of the question, but I do have to thank the member for the question. We as government announced this project in December of 2014. It’s certainly one of the largest public infrastructure projects in the province’s history, and it’s an extremely important project to the future of this of province. So I appreciate having the opportunity to stand in the House and talk about it. I’m not sure if I have a critic with the opposition. He hasn’t asked me any questions about Site C to date.
Fair enough questions about the need for the electricity, the cost of the project. These are all legitimate issues that we should be debating in this House.
I’d like to quote from the panel that Mr. Swain chaired. One of the things that Mr. Swain said was that Site C “would be the least expensive of the alternatives, and its cost advantages would increase with passing decades as inflation makes alternatives more costly.” He went on to say, in terms of debt: “The panel concludes that the risk of Site C to the province’s debt management plan is entirely manageable by a prudent B.C. government.” He went on to say: “There is little doubt about the competence of B.C. Hydro to build and operate the project efficiently.” That’s what the panel report stated.
With respect to need, the forecast that Hydro had done, this is what the panel said. The panel said that B.C. Hydro’s forecasting techniques are sound that and B.C. Hydro “has done a responsible job in forecasting.”
A. Weaver: Well, we have seen Site C pushed throughout without adequate consideration of the cost effective-effective alternatives. I’d like to quote Harry Swain again. He called this a dereliction of duty. Those are very strong words from a very highly regarded senior official from the Canadian government. To be even more blunt, it’s recklessness on the part of the government. We have a sense of the costs: a $800 million loss in the first four years of operation because of construction timing.
What we need right now is a government that is willing to show leadership on this, willing to put good policy ahead of ideological politics. My question to the minister is this. Will he listen to the call from every member of this side of the House, along with the expert opinion of the joint review panel and countless others, to send the Site C project to the British Columbia Utilities Commission for a proper regulatory review?
Hon. B. Bennett: Again, I appreciate the question from the member. I actually haven’t heard a peep from anybody on the other side of the House about Site C other than this member, but that’s fine.
They don’t seem to want to talk about economic issues for some reason or other.
B.C. Hydro has been working on this project for the last seven years. They forecasted a demand for electricity that will require the province to have 1,100 megawatts of electricity by 2024. Their forecasting methodology has been tested by the BCUC. That’s the agency that this side of the House loves so much. The BCUC has actually said that B.C. Hydro’s forecasting methodology is state of the art.
B.C. Hydro figures that we’re going to need 1,100 megawatts of electricity in 2024. We set about, over the past two years, to determine what’s the best way to get that 1,100 megawatts of electricity. We looked at absolutely everything, and the decision that we made on this side of the House was to honour the ratepayer. We chose the option that is the fairest, lowest cost to the ratepayer, but that side of the House wants us to do something different.
For Immediate Release
Victoria B.C. – Andrew Weaver, MLA for Oak Bay – Gordon head and Deputy Leader of the B.C. Green Party says its time to hit the pause button on the Site C dam before British Columbians have to foot the $800 million bill for this government’s rushed decision.
Dr. Weaver’s call follows “unprecedented” comments from Harry Swain, chair of the Joint Review Panel that reviewed the Site C Dam proposal. In an interview with DeSmog Blog Canada, Mr. Swain called the government’s failure to properly consider alternatives to the dam a “dereliction of duty”.
“Mr. Swain is a highly respected former public servant. When someone like him raises such serious concerns, we need to listen,” said Andrew Weaver.
Mr. Swain, is a former Deputy Minister of Industry Canada and Indian and Northern Affairs Canada. He is concerned the government was irresponsible in rushing into its decision on Site C and instead should be taking the time to explore alternatives.
According to the panel’s report, by building Site C now the government will end up saturating the electricity market to the point where it will cost B.C. Hydro more to produce electricity than it will get from selling it. The result would cost British Columbians at least $800 million in the first four years of operation.
“The question that needs to be asked is what’s the rush?” said Andrew Weaver. “LNG isn’t materializing along the timeline promised by government. Even if B.C. Hydro’s current projections are true, we still have up to four years before we need to start building the dam. We should use that time to explore alternatives before embarking on the largest infrastructure project in B.C. history.”
Mr. Swain made it clear that alternatives to Site C exist and should have been considered. The panel, however, was not empowered to do so.
“The Minister’s talking points are missing the point.This dam didn’t make sense for BC thirty years ago, and it doesn’t make sense now.”
Andrew Weaver also joined numerous others in calling on the government to send the Site C project to the BCUC for a full, regulatory review.
Press Secretary – Andrew Weaver MLA
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