A series of conflicts and setbacks has plagued construction of a $725-million transmission line that would serve Metro Vancouver's growing electricity demands, leaving the minister responsible refusing to predict when the project will be in service or how much it will cost.
The Interior to Lower Mainland transmission line was supposed to be competed last fall to deliver the new generating capacity from upgrades at BC Hydro's Mica and Revelstoke dams.
BC Hydro is now heading for arbitration after clawing back a portion of the job from its contractor, Flatiron-Graham Joint Venture. The project has cost $602-million to date and is less than 85 per cent complete.
"Hydro has characterized [the problem] as a failure to perform," Energy Minister Bill Bennett said in an interview on Tuesday.
NDP energy critic Adrian Dix characterized it more bluntly, saying, "The tendering process is a fiasco; the project is a disaster."
Flatiron-Graham won a fixed-price, design-build contract in 2011. Mr. Bennett said the problems began with "serious delays" triggered in part because the contractor brought in faulty steel towers from India that twisted, bent and collapsed. Between the spring of 2012 and the fall of 2013, the contractor tested five designs and Hydro rejected each one as substandard.
As well, there were problems with the contractor's environmental management and protection plans and turnover with its subcontractors. As the dispute escalated, the contractor engaged in deliberate work slowdowns, Mr. Bennett said.
Hydro decided to change the scope of the contract by taking over construction of one of the most technical portions of the 255-kilometre transmission line, a 20-km stretch around the community of Hope. Since last summer, Hydro has had its own crews on site seven days a week, and that short section is still not finished.
Details of the troubled project emerged on Monday night during budget debate in the House, and Mr. Dix later said the problems expose significant risks in the way the Crown corporation is awarding projects to lowest-bid contractors without an experienced work force.
BC Hydro has already posted huge cost overruns with its Northwest Transmission Line project, and a third project, the Dawson Creek–Chetwynd area transmission line, is behind schedule because of defective microphone towers.
"This is the model they want to build Site C with," Mr. Dix said. BC Hydro expects to get shovels in the ground for the $8.8-billion dam this summer and has promised an open-shop contracting process that aims to secure the most cost-efficient labour force. The NDP opposition and trade unions are pushing for a traditional project labour agreement that they say would deliver skilled workers without work stoppages or slowdowns.
Hydro officials maintain the current target is to finish the Interior to Lower Mainland project on budget by this fall. However, the minister acknowledged that is uncertain.
"I know they believe if they can re-establish a better working relationship with the contractor, they can finish the project in 2015. It is up in the air because of the uncertainty between these parties. They are fighting," he said Tuesday. In the legislature on Monday night he was more blunt, saying, "It's very difficult – I think, impossible – to predict when the project would be completed."
Work is continuing on the transmission line, which will run between the Nicola Substation near Merritt (about 270 km northeast of Vancouver) and the Meridian Substation in Coquitlam, while arbitration begins. Mr. Bennett confirmed that Hydro wants to pay Flatiron-Graham a reduced portion of the fix-price contract to reflect the work that Hydro has directly taken over.
"Once the dust settles, BC Hydro will pay Flatiron-Graham not necessarily the costs, but the agreed-upon amount, less what BC Hydro invested in the Spuzzum section of the line," he said.
A spokesperson for Flatiron-Graham said the company would not offer any comment.