BC Hydro introduces Standing Offer Program

BC Hydro launches Standing Offer Program to acquire clean energy
News Release, BC Hydro, 11-Apr-2008

STANDING OFFER PROGRAM
Program Overview
May 6 Information Session

Hydro hunts small power sources
Scott Simpson, Vancouver Sun, 12-Apr-2008

VANCOUVER – BC Hydro launched its Standing Offer Program today to help ensure the province can meet its growing electricity needs with power from clean or renewable sources. The program offers a standard contract with set prices and a streamlined administrative process to give smaller scale projects the opportunity to contribute to B.C.'s supply of clean electricity.

Specifically, the Standing Offer Program targets projects that generate up to 10 megawatts of power. A 10 megawatt project typically provides about 40 GWh per year of energy or enough electricity to power 4,000 households.

"The Standing Offer Program will help the province achieve two important goals of the BC Energy Plan – becoming electricity self-sufficient by 2016 and generating 90 per cent of electricity in the province from clean or renewable sources," said Richard Neufeld, Minister of Energy, Mines and Petroleum Resources.

To be eligible for the Standing Offer Program, projects must generate clean or renewable energy or involve high-efficiency cogeneration. Projects must be located in B.C. and use proven technologies.

"This program will help us meet our future energy challenges by developing innovative, sustainable solutions that will help B.C. maintain its natural, competitive advantage of having a clean and renewable energy supply for generations," said BC Hydro President and CEO Bob Elton.

Feedback received through extensive stakeholder engagement influenced the design of the Standing Offer Program, resulting in revisions to the draft program rules and contract. These revised terms and conditions were part of the program application filed with the British Columbia Utilities Commission (BCUC) for regulatory review. The BCUC approved the program in March 2008.

Developers interested in applying to the Standing Offer Program are encouraged to review the Program Rules, Electricity Purchase Agreement and other documents, and to attend an upcoming information session.

Contact:
Susan Danard
Media Relations
Phone: (604) 623-4220

http://bchydro.com/news/2008/apr/release55742.html

As directed by the provincial government in its BC Energy Plan: A Vision for Clean Energy Leadership, BC Hydro is implementing a Standing Offer Program to encourage the development of small and clean energy projects throughout British Columbia. The Program is a process to purchase energy from small projects with a nameplate capacity greater than 0.05 megawatts but not more than 10 megawatts.

Through a series of informal stakeholder engagement sessions and written comments, we received extensive feedback from stakeholders about previous calls for power and the design of the Standing Offer Program. As a result, the Program has been designed to:

* simplify the process, the contract and its administration
* decrease the costs of participation for developers while remaining cost-effective for the ratepayer
* meet the need identified by the BC Energy Plan and embody its policies and principles.

The Standing Offer Program Rules explain Program details including eligibility requirements, the application process and the Standard Form Electricity Purchase Agreement (EPA) terms.

Upcoming information sessions

BC Hydro invites you to attend an information session on May 6, 2008 in Vancouver to review the Program Rules and the application process. This session is intended for developers that are ready, or are planning, to submit an application.

* Register for this information session

We are also planning to hold regional information sessions over the coming months. Details on these sessions will be posted shortly.

Standing Offer Program details

BC Hydro scaled its hunt for green electricity down to the micro level on Friday, announcing that it will welcome prospective producers of incremental bits of power any time they're ready to join the grid.

Projects of 10 megawatts or less are eligible and Hydro says it will take all it can get -- promising a streamlined application process for small-scale producers.

Proponents of larger projects must wait for the Crown corporation to issue a call for power before seeking an electricity sales agreement.

Under the Standing Offer program launched Friday, the little guys can fill out some standard application forms online and -- provided they have all necessary permits and other documentation -- they can join whenever they're ready.

Hydro has been working on the program for two years with independent power producers, and it was approved in March by the B.C. Utilities Commission.

Small run-of-river power projects would seem to be obvious candidates, but Hydro spokesperson Susan Danard said generating projects involving landfill gas, wind, solar, co-generation at industrial sites, and other green technology will qualify.

The program runs indefinitely, and Hydro is uncertain how many projects will join the grid in the near term -- it could be anywhere from 10 to 50 by 2010, Danard said in a telephone interview.

Standardized power sales agreements make it easier for proponents to contract with Hydro, but Danard noted that the list of other required documentation is lengthy, running to two pages in online documentation posted Friday afternoon on Hydro's website

"They have to have all their permits in hand to be ready to go," Danard said.

Hydro will pay between $71.37 and $84.23 per megawatt hour for power from small producers, which is more or less in line with the $71 to $74 amounts contracted in Hydro's major 2006 call for power.

There's a $3.10-per-megawatt-hour bonus for producers who get eco-certification.

Energy sector commentator David Austin said he expects most of the projects will be near the province's main population-electricity consumption centres, since additional transmission costs will eat into revenue at more distant locations.

Austin said he does not expect the program to trigger a gold rush.

"It's one thing to identify a resource, it's another to be able to produce it at the price being offered. This is always the hurdle that people have to overcome in order to be able to sell their electricity."

Melissa Davis, executive director of Citizens for Public Power, said the group is concerned that the process lacks the oversight that would be applied if Hydro itself were developing the same sources.

Davis said the electricity acquired under the program would be a "drop in the bucket compared to the provincial government's stated need for new generation -- unless Hydro is understating the scale of the response it expects."

"Can we expect to see a doubling or tripling of the more than 600 existing water licences and applications for private power projects on B.C.'s rivers and creeks through this program?" Davis asked.

ssimpson@png.canwest.com
© The Vancouver Sun 2008