John Richards is an economist and a professor at Simon Fraser University focusing on social and aboriginal policy.
In Voltaire's novella, Candide initially views the world with unbridled optimism: It is the "best of all possible worlds."
As he travels and experiences the difficulties in remedying the world's problems, he ultimately opts for a pragmatic tactic: He cultivates his garden. B.C. is suffering from an excess of faith in Voltaire's solution for Candide's naiveté.
With its forests, rivers, mountains and coastline, B.C. has one of the most beautiful gardens in the world. We have many reasons to cultivate it. However, that does not give us a mandate to ignore the country's problems.
Let me explain.
The former B.C. government decided in late 2014 to proceed with construction of the $9-billion – perhaps $10-billion – Site C dam, the third dam along the Peace River in northeastern B.C. If completed, it will produce power equivalent to roughly 10 per cent of B.C.'s current domestic consumption. Why the government decided to proceed when it did is not clear.
Presumably, one motivation was to create construction employment in lieu of the previously promised construction employment for LNG plants, projects no longer profitable following the 2014 decline in oil and gas prices.
Our political "Candides" immediately highlighted dam-induced damage to the Peace River Valley, opposition by most (not all) of the First Nations nearby, and the fact that B.C. would not domestically need the power generated for at least a decade after the dam's completion, in the middle of the next decade. Site C became the main political issue in the recent provincial election: the Liberals promised to complete it; the Green party adamantly opposed completion; the NDP were divided between union supporters of the dam and urban opponents. Unexpectedly, B.C. now has a minority government: The NDP governs (with 41 MLAs), but depends on support from the Greens (three MLAs) to maintain a slim legislative majority over the Liberals (43 MLAs).
Respecting the government deadline of Nov. 1, the B.C. Utilities Commission has issued a major report on the cost of either completing Site C or pursuing non-carbon alternatives to the dam. To date, more than $2-billion has been spent; if Site C is cancelled, the commission predicts it will cost nearly $2-billion to remediate the river valley. The commission made pessimistic estimates of cost to complete and very low estimates for the export value of Site C power. It made optimistic estimates for the cost of alternatives. The commission's bottom line: Even adding $2-billion in cancellation and remediation costs, the net costs of proposed alternatives to satisfy future B.C. domestic demand are similar to the net cost of Site C. It made no mention of an Alberta tie-in.
One of the few points of agreement between supporters and opponents of Site C is that the capacity will not be needed in B.C. for probably ten years following completion. If Alberta and B.C. were one province and if there existed adequate transmission capacity, there is no doubt that Site C should be completed. At least over the first decade of operation, Site C power could make a major contribution to Alberta's meeting its commitment to phase out coal-fired power plants. If we value elimination of the greenhouse gases arising from this coal-based electricity at $50 a tonne of carbon dioxide (the carbon price to which all provinces have more-or-less agreed), the social value of Site C is at least $1-billion higher than the commission estimate.
Were Voltaire alive and living in the land of "quelques arpents de neige," he would point out that B.C. and Alberta are obviously not one province and currently, Alberta is unlikely to help B.C. by buying Site C power unless B.C. reciprocates and enables a new pipeline for offshore oil export.
He would also point to a map of Canada showing nearly all major power transmission lines flowing south – exporting power from hydro developments in Quebec, Manitoba and B.C. to the United States – and very few interprovincial lines.
Finally, he would point out that Ottawa has shown little interest in committing its promised infrastructure bank to invest in expensive interprovincial transmission links. Building an adequate transmission link from Site C to Alberta would cost at least $500-million. At probably similar cost, Manitoba could link to Saskatchewan and get the latter off coal. And there are other links to be made from Quebec to the Atlantic provinces and Ontario.
Perhaps Ottawa will step up and assume its share of responsibility for "decarbonizing" the generation of electricity. Perhaps Ottawa is also suffering from the "Candide syndrome."