BC Hydro to resubmit strategy plan to include clean energy

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BC Hydro will submit its long-term energy strategy directly to the cabinet this week, after provincial Energy Minister Bill Bennett ordered the Crown corporation to revise its plan to include new opportunities for investment in the clean-energy sector.

Mr. Bennett, who is scheduled to address Clean Energy BC's Generate 2013 conference in Vancouver on Monday, said the industry should be grateful his cabinet has circumvented the utility's regulator, the B.C. Utilities Commission, by taking direct control over BC Hydro's Integrated Resource Plan.

"I'm going to tell them there will be something in the IRP that provides a go-forward strategy for the clean-energy industry," Mr. Bennett said in an interview Sunday.

"It's pretty safe to conclude the BCUC would not have found a big role, if any, for clean energy."

The directive is intended to give some hope to clean energy proponents at a discouraging time: In the draft IRP tabled in August, BC Hydro indicated it would not need any new power generation capacity for the next 10 years.

Just three years ago, B.C. and Ontario were locked in a battle to provide the best climate for investments in alternative power.

Today, companies like Sea Breeze Pacific are struggling to open doors in Victoria.

Paul Manson, the company's CEO, presided over the recent completion of Vancouver Island's newest wind farm, at Cape Scott.

But that hasn't generated much enthusiasm for his latest venture – a proposal to build a new transmission line connecting British Columbia to the U.S. power grid.

Sea Breeze is offering BC Hydro a 10-year power supply contract that would take advantage of low U.S. power prices.

First, the company and its partners would build an undersea transmission line to connect Victoria with Port Angeles in Washington State. That, in turn, would allow B.C. to trade more power back and forth with the U.S. – the existing line between Surrey and Blaine, Washington State, runs at capacity at peak times.

Mr. Manson's company has been trying to build the Juan de Fuca Cable for years, but was rejected by the BCUC six years ago.

However, with BC Hydro's latest transmission line project overdue and significantly over budget, Mr. Manson hopes policy makers in Victoria would now be more amenable to the idea of leaving the construction risks to the private sector.

Sea Breeze is offering to sell BC Hydro 550 megawatts of firm power at $69 per megawatt hour. By contrast, BC Hydro expects its proposed $8-billion Site C dam to produce power at a cost of $83 per megawatt hour.

"Being able to access new capacity is a great insurance policy for BC Hydro," Mr. Manson said.

Mr. Bennett said he doesn't dispute BC Hydro's forecasts, which predict more capacity won't be needed for 10 years. But he said there could be unforeseen developments – if the economy grows faster than expected or if energy conservation efforts fall short.

Another major unknown is how any new liquefied natural gas plants will be powered. While BC Hydro is expecting any major LNG plants to self-supply most energy needs by burning natural gas, Mr. Bennett said it is still possible some may choose to use cleaner electric drive motors.

He said the Juan de Fuca cable proposal merits serious consideration. "It will be looked at very carefully," he said. "If there is a private sector way to keep rates down, we are going to have a close look at it."