October 30, 2009
IPPBC Welcomes Paul Kariya as New Executive Director
COMMENT: This notice is in advance of IPPBC's annual general meeting and trade show from Sunday, Nov 1, to Tuesday, Nov 3. More details here.
News Release
Independent Power Producers Association of B.C.
Oct 29, 2009
 Paul Kariya appointed new Executive Director of IPPBC. |
"We are delighted to have been able to attract someone of Paul Kariya's calibre to this position," said Harvie Campbell, Chair of the IPPBC. "Dr. Kariya's background and experience in managing complex issues and in dealing with governments and stakeholder groups will be real assets to the independent power industry in this province."
"The credibility that Paul Kariya brings to this position will help the industry work more effectively with First Nations, environmental groups, the media, and others," said Campbell.
Most recently, Dr. Paul Kariya has been teaching Leadership in the Graduate School at Trinity Western University. He served as executive director of the Pacific Salmon Foundation from 2002 to 2008, chief executive officer of Fisheries Renewal BC from 1998 to 2001; and executive director of the BC Treaty Commission from 1994 to 1998. Kariya also served in various positions with the federal government from 1979 to 1994, primarily in the departments of Fisheries and Oceans and Indian and Northern Affairs. He has a BA from the University of B.C. and post-graduate degrees from Clark University.
"This is an exciting time for all who want to help society shift to increased reliance upon clean power sources and greater conservation efforts in B.C.," said Paul Kariya. "There are numerous challenges but also tremendous opportunities here. The provincial government is committed to growing the industry, First Nations are interested in business partnerships and the public is keen for positive dialogue on subjects such as alternative energy sources, sustainability and a healthy environment. I look forward to contributing to the growth of the independent power sector in British Columbia."
The Independent Power Producers Association of B.C. represents 320 project developers and service providers in the power generation sector in the province. The role of IPPBC is to support the development and continued viability of an independent power industry. The association serves the public interest by providing cost-effective electricity though the responsible development of generation resources in order to help meet the goals of provincial self-sufficiency by 2016.
For more information, please contact
Independent Power Producers Association of B.C.
Harvie Campbell
Chair, IPPBC
(778) 945-1002
or
Independent Power Producers Association of B.C.
Paul Kariya
Executive Director, IPPBC
(604) 818-1827
www.ippbc.com
October 29, 2009
LTAP: MEMPR "clarifies intention" on Burrard Thermal
COMMENT: This puts the boots to BCUC's decision on the LTAP.
Burrard is out! "Effective immediately Burrard will no longer be used for planning purposes for firm energy."
The Clean Power Call is in! And BC Hydro now has to acquire even more energy by 2016 than it anticipated in the 2008 LTAP - happy day for IPPs.
PROVINCE ADVANCES COMMITMENT TO CLEAN, RENEWABLE ENERGY
Media ReleaseMinister of Energy, Mines and Petroleum Resources
October 28, 2009
VICTORIA – As part of its commitment to reduce greenhouse gases and become a clean energy powerhouse, the Province has clarified its intention to the British Columbia Utilities Commission (BCUC) to end BC Hydro’s reliance on the Burrard Thermal Generating Facility for energy needs. The decision was announced today by Blair Lekstrom, Minister of Energy, Mines and Petroleum Resources.
“We’ve been committed since 2001 to ending BC Hydro’s reliance on Burrard and to only using it for emergency back-up capacity,” said Lekstrom. “In B.C, we have the opportunity to develop clean, renewable, cost-effective electricity with virtually no greenhouse gas emissions. That will also improve air quality in the Lower Mainland.”
BC Hydro has been planning to reduce its reliance on Burrard, as proposed in its recent Long Term Acquisition Plan, to help meet the legislative target to reduce greenhouse gas emissions by six per cent by 2012, 18 per cent by 2016, and 33 per cent by 2020. Today’s direction is consistent with the government’s Climate Action Plan, BC Energy Plan, and the Utilities Commission Act.
Effective immediately Burrard will no longer be used for planning purposes for firm energy. It will only be used for up to 900 megawatts of emergency capacity.
“In providing this direction, BC Hydro will replace the firm energy supply from Burrard Thermal with clean, renewable and cost-effective energy,” said Lekstrom. “Ending our reliance on energy from Burrard Thermal for planning purposes is also a critical component of B.C.'s greenhouse gas reduction strategy.”
Burrard will no longer be relied upon for energy but will continue to be available to provide emergency back-up power in the event of generation or transmission outages, which is a benefit to British Columbians. Typically, Burrard’s actual operation is less than 10 per cent of what it is capable of generating per year.
Clean and renewable energy continues to be a cornerstone of British Columbia’s climate action plan that will create jobs, support families and generate new economic activity throughout British Columbia. BC Hydro has been upholding that plan. Electricity self-sufficiency and clean and renewable power generation are integral to B.C.’s effort to reduce its carbon footprint and fight global warming.
This decision will also allow BC Hydro to continue to acquire 6,000 GWh of cost-effective, clean and renewable power. This includes up to 5,000 GWh from the Clean Call and up to 1,000 GWh from Phase 2 Bioenergy Call for Power.
-30-
Contact:
Jake Jacobs
Public Affairs Officer
Ministry of Energy, Mines and Petroleum Resources
250 952-0628
250 213-6934 (cell)
B.C. government orders Burrard Thermal writeoff
By Scott SimpsonVancouver Sun
October 29, 2009
 The aging Burrard Thermal generating plant. (Photograph by: Ian Lindsay, Vancouver Sun files) |
VANCOUVER — The British Columbia government has written off the aging Burrard Thermal generating plant as a reliable source of electricity.
Energy Minister Blair Lekstrom announced late Wednesday that BC Hydro can no longer include the 50-year-old, gas-fired plant on its roster of power generating facilities.
At full operation, Burrard is one of the largest sources of greenhouse gas in the province, but has been increasingly relegated by BC Hydro to a role backing up the province's sprawling network of hydroelectric facilities — due to its age and the relatively high cost of natural gas.
However, despite limited use Hydro has been listing Burrard on its books as part of its primary electricity supply.
That policy effectively diminished the amount of new, private sector power development deemed necessary to enable Hydro to reach its government-mandated target of making B.C. electricity self-sufficient by 2016.
The policy helped minimize the rate increases that are necessary to cover the cost of development of new power generation.
But it also cramped the government's plans to expand private power development in hopes of creating enough surplus power for expanded export sales to the United States and Alberta.
In an interview, Hydro vice-president Bev Van Ruyven said Thursday that Hydro is now 6,000 gigawatt hours per year short of the generating capacity needed to meet the self-sufficiency target and is now looking at its options for hitting the government's target on schedule.
Hydro has a number of options including a pending deal with Teck Cominco for expanded power supply from private generating facilities in southeast B.C., development of a new biomass-powered generation sector — and expanding its call for green power generation bids.
Check out Scott Simpson’s blog: www.vancouversun.com/energy
© Copyright (c) The Vancouver Sun
Burrard Thermal goes to back burner
Tom FletcherBC Local News
October 29, 2009
VICTORIA – Energy Minister Blair Lekstrom has made good on his promise to order the shutdown of Burrard Thermal in Port Moody, BC Hydro's largest fossil fuel electricity generation facility.
Lekstrom has directed the B.C. Utilities Commission that effective immediately, Burrard Thermal will no longer be used in BC Hydro's energy supply plans, and will only fire its natural gas boilers for up to 900 megawatts of emergency power.
One emergency scenario is an ice storm such as one that brought down power lines across much of Quebec in 1998, Lekstrom said.
Lekstrom promised the action in late July after the utilities commission rejected parts of the government's energy plan and advised BC Hydro it should count the capacity of the aging facility in its plans.
"This is about clarifying our position as government," Lekstrom said. "We were very clear going back to 1996, Burrard Thermal was not in the future plans in British Columbia. We think that it has lived its life cycle. We believe that as we move forward into clean, renewable energy opportunities in British Columbia, we're blessed with a diversity of that opportunity. Burrard is not part of that."
B.C.'s Independent Power Producers Association applauded the government's move.
"Reducing our reliance on Burrard will reduce greenhouse gas emissions, improve air quality in the Lower Mainland and grow B.C.'s economy through the development of new renewable energy sources," said Harvie Campbell, chairman of the association.
Lekstrom said the decision to override the utilities commission on use of Burrard Thermal does not diminish its authority to protect the public interest in electricity rate and expansion decisions. Its mandate from the government is to approve "clean, affordable power" and keep electricity rates in B.C. among the lowest on the continent, he said.
BC Hydro has spent $8.7 billion since 2001 on projects to expand its dams and electricity grid. The Crown-owned utility is also studying the Site C dam project, a third dam on the Peace River that has been under consideration for 30 years.
Premier Gordon Campbell has repeatedly vowed that BC Hydro's dams and other heritage assets will remain publicly owned, and that if Site C is constructed it too will be owned and operated by BC Hydro.
Government clears way for greener power expansion
Scott SimpsonVancouver Sun
October 30, 2009
BC Hydro should focus on sources of clean, renewable, cost-effective electricity, minister says
The British Columbia government has ordered BC Hydro to yank the aging Burrard Thermal generating plant off its roster of baseline electricity sources.
The decision throws open the doors to a significant expansion of private-sector power development, and sparked a fresh round of debate Thursday among private power supporters and opponents.
The decision, which came in the form of a special Cabinet directive to the B.C. Utilities Commission, forces Hydro to accelerate power-acquisition plans established to meet B.C.'s goal of being electricity self-sufficient by 2016.
Hydro is now looking to add 6,000 gigawatts per year of new electricity supply -- enough power for 600,000 homes.
At full operation, Burrard is one of the largest sources of greenhouse gas emissions in the province.
In practical terms, the 50-year-old gas-fired plant located along the Port Moody Arm of Burrard Inlet is serving only a nominal backup role for the province's sprawling network of hydroelectric facilities.
But Hydro has been listing Burrard on its books as part of its primary electricity supply -- thus dampening the amount of new private-sector power necessary to meet the government-mandated self-sufficiency target.
Energy Minister Blair Lekstrom said in an interview on Thursday that the government wants Hydro to focus on sources of clean, renewable and cost-effective electricity.
"Burrard is antiquated technology in an airshed that is pretty difficult to manage," Lekstrom said. "When we think about the air quality, running this just doesn't make sense."
Lekstrom said Hydro will seek 1,000 gigawatt hours of power through development of a biomass-burning sector, and a further 5,000 gigawatt hours from Hydro in-house development and private-sector projects.
But he added that the government won't accept bids from private power developers unless the electricity they offer is reasonably priced.
"At the end of the day, this is about affordable electricity for British Columbians. I'm not a supporter of buying electricity at any cost. I think I've made that clear since I've been in this portfolio."
Hydro vice president Bev Van Ruyven said the Crown corporation is now looking at its options for hitting the government's target on schedule.
Hydro is already in the midst of a clean power call that attracted 17,000 gigawatt hours' worth of bids -- although Hydro had previously stated it would only contract for 2,000 GWh after scrutinizing bids and accounting for attrition.
"Going forward, if Burrard is not in our planning stack, we now have a gap that we need to fill to meet the self-sufficiency goal in 2016," said Van Ruyven.
She added that Hydro is reviewing the government's order and will have a better idea of its options in about 10 days.
Hydro has a number of options, including Hydro in-house projects that upgrade and expand generation from the Crown corporation's own "heritage"
hydroelectric facilities including Mica and Revelstoke.
David Austin, B.C. electricity sector commentator and legal counsel for some power producers, agreed with the decision on Burrard.
"Finally, Burrard is being recognized as the industrial relic that it is, and subject to seeing the fine print [in the government's announcement], is being unconditionally and absolutely relegated to the role of last-resort use. It isn't being junked, but pastured for infrequent use like cold snaps or major equipment failures."
Harvie Campbell, chair of the Independent Power Producers Association of B.C., said the decision gives the industry the certainty it was lacking last summer after the BCUC made a controversial ruling that Hydro should increase the amount of power supply it keeps on the books for Burrard -- in order to minimize the impact upon ratepayers of adding new power supply.
The cabinet directive effectively overturns the BCUC's ruling.
"The most important aspect of this directive, for the industry, is that it constitutes concrete action," Campbell said. "The financial community was watching. They were concerned it had taken us this long to get where we are."
Campbell said both Hydro and industry will have to address the high attrition rate -- about 30 per cent -- among private power bids previously accepted by Hydro in order to help the Crown corporation reach its self-sufficiency target.
"That is not a criticism of anyone. It underlines the need for the IPP community to work more closely with BC Hydro in fashioning acquisition processes that will work."
Donald McInnes, CEO and vice-chair of Plutonic Power, said the government's order "has given BC Hydro and the utilities commission the tools required to allow BC Hydro to go out and procure further energy."
Port Moody Mayor Joe Trasolini said Burrard pays the city about $1.4 million per year in grants and royalties in lieu of taxes.
He said the directive will cost the city about $200,000 a year in lost royalty revenue -- equivalent to a 0.75-per-cent property tax increase to residents.
Aaron Hill, an ecologist with Watershed Watch Salmon Society, said it "makes sense" to minimize B.C.'s reliance on fossil fuel for electricity supply.
"But rather than rushing to dam and divert B.C. rivers and streams for hydro power, much of which is likely to be exported to California, we should be making energy efficiency and conservation our number one priority."
Tzeporah Berman, executive director of PowerUP Canada, noted that 75 per cent of B.C.'s total energy consumption is fossil fuel, so "direction from the government that opens the way for more wind farms and other clean energy projects is good news."
"If we are going to reduce global warming pollution and create new clean economy jobs in B.C., this kind of clarity is critical," Berman said.
Melissa Davis, executive director of BC Citizens for Public Power, said the Burrard order "is simply a way for the government to continue to manufacture an energy crisis and justify the need for private power production -- under the guise of acting as a solution to climate change."
October 24, 2009
Carbon trust faces tonnes of work
By Scott Simpson,
Vancouver Sun
October 24, 2009
B.C. could be paying $25 million a year to compensate for its carbon emissions
Calculating the difference between a $25 carbon credit purchased in British Columbia and a 14-cent credit purchased in daily trading on the Chicago Climate Exchange is apparently not a matter for simple arithmetic.
The $25 credit is what you, as taxpayers, are forking out to support the B.C. government's ambitious, precedent-setting plan to make itself carbon-neutral before 2011.
B.C. anticipates that core government agencies and offshoots, including schools and health districts, will be annually responsible by the end of 2010 for about one million more tonnes of carbon dioxide emissions than their conservation efforts can reasonably prevent.
That's where you come in.
The government's ambition, announced by Premier Gordon Campbell in 2007, is to compensate for every one of those million tonnes by purchasing carbon credits from businesses and industries that reduced their reliance on fossil fuels such as oil, natural gas, or coal -- and had their efforts certified by independent, third-party auditors.
PACIFIC CARBON TRUST
The credits are collected by Pacific Carbon Trust, a new Crown corporation that pays emitters an unspecified amount for each tonne of CO2 emissions they cut through innovative conservation efforts, and resells them to government at $25 a tonne.
Assuming the scheme can be carried out in the time frame established by the premier, the province will be paying $25 million a year to compensate for its carbon emissions.
There are entire B.C. government ministries such as energy, finance, and environment, whose annual capital expenditures are less than $25 million, according to the government's 2010 fiscal year estimates.
Cheaper credits are available.
You can buy a tonne of carbon credit, or offset, for 14 cents on the spot market of the Chicago Climate Exchange, although critics suggest your money would be safer in a penny mining stock from a Howe Street promoter circa 1975.
You could buy one from the European Climate Exchange, which is pricing a tonne of carbon at about the same level as B.C. That would mean shipping tax dollars to foreign jurisdictions with no commensurate economic stimulus to justify the effort.
The good news here, if you're in favour of the B.C. government's effort, is that this province has established a market and a trading system that appear to be working as hoped -- as the first North American jurisdiction with mandatory carbon emission reduction targets.
(Credits available in Chicago are from voluntary emission cutbacks whose pedigrees, as the price of carbon on that market suggests, are suspect.)
Christine Schuh, environmental practice leader for PricewaterhouseCoopers, said in an interview that comparing B.C.'s pricing system to Chicago's is like comparing apples to oranges. The system in this province is regulated, while Chicago's is not.
But she added that it's also difficult to compare B.C. to the European exchange, because the systems themselves are "not equal yet."
Based in Calgary, Schuh serves on the Independent Organization for Standardization (ISO) committee that developed globally recognized standards for measuring and validating greenhouse gas emissions.
If there is a weakness in the B.C. system, she said, it's that it may not yet be aggressive enough to attract large-scale efforts by industry.
MOTIVATING CHANGE
"To motivate behavioural change in a population, you need prices for carbon credits in the $5-to-$60 price range per tonne. If you want to make technology like carbon capture and storage economically feasible, the price of those credits needs to be $80-plus per tonne.
"Keeping that as a reference point, the $25 per tonne is probably a good starting point, but it's not going to be the end point."
The CEO of Pacific Carbon Trust, Scott McDonald, believes they are off to a good start. Since April, the trust has contracted 66,000 tonnes per year of carbon offsets on the province's behalf.
Earlier this month, it announced an open call for credits with no quota or time limit.
"We are not sitting here waiting," McDonald said. "Our pitch to the large emitters is that there is a price signal around carbon. So if you are doing your [economic] models around new investments, include a price for carbon in that price model. ... It becomes very attractive to do these kinds of projects.
"We want to make that opportunity available and make them aware of that."
Pacific Carbon Trust and private-sector "aggregators" such as Sempa Power Systems and Offsetters Clean Technology are unearthing businesses that have made legitimate efforts to lower their carbon emissions.
There are vacation resorts, hotels, and greenhouses on the list. And no doubt to the government's great relief, a big fish: One of the largest greenhouse gas emitters in the province.
LAFARGE GETS ON BOARD
It is Lafarge Cement, the multinational whose Richmond cement plant is regularly listed by Environment Canada as one of British Columbia's top 10 emitters of carbon dioxide and related gases believed to contribute to global warming through combustion of fossil fuel.
Lafarge burns coal to make cement. Coal burns with a high intensity that is fundamental to the manufacture of their product. But the cement process can tolerate supplementary amounts of biomass, Lafarge director of business development Randy Gue noted.
"We are a public company, we are profit-driven, we looked at the incentives that are there," Gue said in an interview.
"The sale of the carbon offsets helps basically fund the cost of doing the project and the risks that are involved in [introducing] different fuels.
That's really the purpose of carbon offsets, to incent companies to shift away from traditional methods and incent projects that wouldn't normally happen in an unregulated carbon market."
There is a further bonus, he noted: Reducing the use of fossil fuel in the manufacturing process also reduces the amount of carbon tax Lafarge will have to pay the province.
OFFSETTERS AIDS COMPANY
Vancouver-based Offsetters Clean Technology, a pioneer in the aggregation and sale of offsets, approached Lafarge with the opportunity after hearing about the company's struggles to source a consistent and reliable, cost-effective supply of waste wood for its burners.
Aggregators are pivotal to the success of the trust, tracking potential bidders, measuring greenhouse gas emissions, calculating potential savings and contracting third-party validators to pore over the data and confirm the extent of emission savings.
"We knew that Lafarge was looking for wood and that they were hesitant about the cost of the wood, so we went to them and said 'Look, we can help subsidize the cost of fuel-switching for you,'" Offsetters president and co-founder James Tansey said.
"It would have been very challenging for Lafarge to do this on their own, secure the documentation, secure the prices, and negotiate on their behalf. That's our role as a business."
Tansey describes B.C.'s time frame for reaching one million tonnes of offsets as "challenging."
Pacific Carbon Trust's Scott McDonald said the Crown corporation is "actively engaged" with virtually all of the province's large emitters, including Spectra Energy, Teck Cominco, Rio Tinto Alcan, Lehigh Cement and Chevron.
Spectra, which operates natural gas processing plants in the northeast B.C. gas patch, is already working to achieve what it calls "near-term emissions reductions across our B.C. natural-gas-gathering, processing and transportation system."
Those activities, which include an ambitious carbon capture and storage project at Fort Nelson gas plant, are happening irrespective of the activities of the trust.
Valley residents are ready to fight Metro's plan to burn garbage
Patricia Ross,
Vancouver Sun
October 24, 2009
Serious concerns have been raised about Metro Vancouver's plan to install six waste incinerators around the Lower Mainland: The prohibitive costs, the potential impact on the environment and the inherent disincentive to recycle that comes with incineration.
These are all important issues, to be sure. But there is one issue that is of greatest significance to me and to my constituents: air quality.
Resolving the region's garbage crisis is a complex challenge. There are no easy solutions. What must be understood is that there are limitations to operating in an airshed as extraordinarily challenged as ours.
Given the recent memory of Sumas 2 -- the proposed Washington state project that was defeated after strong opposition based on concerns about air quality -- the air we breathe should be top-of-mind in these discussions.
Instead, Metro Vancouver has chosen to ignore the Valley's legitimate and growing health and air-quality concerns and surge ahead with its campaign to sell us on the benefits of burning garbage for energy. In the process, they have cited the hundreds of incinerators in use throughout Europe, some in the heart of major cities such as Paris and Vienna, as reason to feel secure about the issue of emissions and air quality.
What they are not telling us is that 33,000 European doctors have signed a petition calling for a ban on further waste incineration and the closing of existing facilities for what they believe are serious human health concerns.
In 2007, researchers in the United Kingdom established that there is a significantly higher death rate for young children (up to 12 months) who are regularly exposed to smoke from incinerators. And despite the proliferation of incineration facilities across the U.K., there is vigorous public opposition to the practice of burning garbage for energy, largely due to mounting health issues that can be linked to incineration.
In Nottingham, for example, residents living downwind of the Eastcroft waste incinerator associate its emissions with a spike in respiratory health issues in the community. They call it the "Eastcroft cough."
We know that incinerators produce harmful chemicals such as dioxins that are not only toxic but also persistent and bio-accumulative. That alone should be enough to give us pause, considering the livestock and produce that originate in the valley. But in the case of incinerator emissions, there is also significant risk in what we don't know.
In addition to a number of other chemicals, we know that incineration produces fine particles called nanoparticulates, and we know these particles can pass through the most sophisticated scrubbing equipment.
Research into the impact of these particles on human health is still preliminary, but early indications are that nanoparticulates can be linked to serious human diseases such as cancer. In fact, the health complications caused by nanoparticles have been compared to those of asbestos.
At a minimum, given that nanoparticles are not measured, reported, or required to be, we need to err on the side of caution.
Carried by the winds off Georgia Strait, these dioxins, nanoparticles and other potentially harmful chemicals produced by incineration will find their way into our airshed. Incineration experts have cited European cities with similar mountainous geography to rebut the air quality argument here, but there is no comparison to the Fraser Valley. University of B.C. Prof. Douw Steyn, an internationally recognized air quality expert, says the valley is so vulnerable to incremental increases in emissions that it is pointless and misleading to compare it to cities in Europe when advocating incineration.
As the people in the Fraser Valley know, our geography can be unforgiving when it comes to air quality. In 2001 when the region fought against Sumas 2, Metro Vancouver agreed. In a letter to the National Energy Board, Metro Vancouver declared that, "SE2 is neither an appropriate nor responsible decision to locate within this sensitive airshed or in such close proximity to a major residential area where the air quality is already above levels at which significant human health effects can be observed."
That argument still stands, but today Metro Vancouver is proposing new sources of pollutants.
Last week the region learned a lot about recycling alternatives at the Resilient Cities conference. We know that other waste solutions exist and that these models have been applied successfully in Seattle, Portland, and San Francisco. Each of these cities rejected incineration in favour of a waste management plan that emphasizes reducing, reusing and recycling.
San Francisco, for example, has achieved a 75-per-cent diversion rate and relies on existing landfills as a flexible disposal option. This helps, not hinders, their ability to get closer to zero waste. Compare this to incineration, which demands a steady flow of waste and landfill space to house toxic ash generated by the burning garbage, and the sustainable answer becomes clear.
Metro Vancouver has the time and opportunity to explore waste management options that are sustainable and responsible. The plan favoured by Metro Vancouver is neither.
As the debate continues, you can be sure that residents of the Fraser Valley will continue to fight for their right to clean air and a healthy future.
Patricia Ross is the chairwoman of the Fraser Valley Regional District and an Abbotsford city councillor.
October 23, 2009
Gas auction attracts $370 million to B.C.
By Scott Simpson
Vancouver Sun
October 23, 2009
It's the second-largest average per-hectare price paid to lock up new drilling rights in northeast patch
There appears to be no letting up in the race to lock up natural-gas wealth in northeast British Columbia.
On Thursday, Energy Minister Blair Lekstrom announced that the province received $370 million in bonus bids in its monthly auction for gas exploration rights, making it the sixth largest monthly sale on record, and the second-largest average per-hectare price paid to lock up new drilling rights in the province's northeast gas patch.
Bidders anxious to secure tenure of one of North America's hottest gas patches scooped up 58 parcels covering 65,787 hectares, paying an average per-hectare price of $5,625, second-highest in B.C. history, the government reported.
The sprawling Montney gas field attracted most of the interest. It is one of two major new fields attracting record bids. The other is Horn River. Both are in British Columbia's portion of the Western Canada Sedimentary Basin.
"Most of what we are talking about today is in the Montney formation," Lekstrom said in an interview. "Every day, both of these formations seem to get a little better as there is more work done on them. They seem to expand and the quality and the opportunity expands at the same time, so I think these numbers today are reflective of that."
So far this year B.C. has gained $700.6 million in drilling rights despite a protracted dip in natural gas prices that has substantially reduced gas and oil exploration activity in Western Canada and across North America, where moderate weather and growth of unconventional gas resource development in the United States are creating an unprecedented glut of gas in storage.
Lekstrom said the auction results are partially attributable to the government's recent decision to slash gas royalty payments for one year, attracting more investment to B.C.
In September, the minister announced that wells drilled from September 2009 to through June 2010 will receive a one-year royalty rate of two per cent compared to the average rate of 20 per cent.
"The latest stimulus package we put out, I think, gives some certainty to the industry of where our province stands with oil and gas and the future," Lekstrom said.
© Copyright (c) The Vancouver Sun
October 17, 2009
Province halts major transmission system inquiry
By Scott Simpson
Vancouver Sun
October 20, 2009
Government's desire to export green power and a recent utilities commission ruling are thought to be behind the delay
The provincial government has put the brakes on a major inquiry into the future of British Columbia's electrical transmission system.
A review of documents on the website of the B.C. Utilities Commission shows that the inquiry is attracting unprecedented interest from stakeholders including first nations, municipal governments, BC Hydro ratepayer groups and independent power producers.
The inquiry was ordered last year as a means of addressing B.C.'s transmission needs for the next 30 years. Jurisdictions across North America are facing the same challenge -- aging networks of towers and wires that are close to capacity and need repair, upgrade and expansion.
BC Transmission Corp. says B.C. needs an estimated $4.5 billion worth of upgrades -- and that's not counting a new transmission service for northwest B.C., nor the cost of expanding transmission to allow independent power producers to hook into the system, nor the cost of expanding opportunities to export electricity to the United States.
Last Friday, the utilities commission ordered an indefinite postponement of the inquiry as well as related regional consultations with numerous first nations around the province.
The postponement came after BC Hydro and BC Transmission Corp. said they were making changes to their initial submissions for the inquiry due to a "policy-level review" by the provincial government.
It's expected that the reviews are related to the government's interest in expanding the development of independent power production in B.C. for the U.S. export market.
B.C. has an ambitious plan for so-called green power exports, notably to a receptive market in California, but is stymied from moving ahead until it deals with a ruling earlier this year by the B.C. Utilities Commission that put a damper on expansion of the independent power sector.
According to Energy Minister Blair Lekstrom, the government is reviewing Hydro and BCTC submissions
"to make sure that the information they are filing is consistent with our policy. . . . That's taking longer than anticipated."
Lekstrom expects the inquiry will resume in November.
Ludo Bertsch, an intervenor representing Energy Solutions for Vancouver Island, said he is surprised by the delay, given the enormous public interest in the hearing.
"It's probably the largest hearing that BCUC has put together. There are over 100 intervenors and dozens of interested parties registered," Bertsch said in an interview.
Blog: www.vancouversun.com/energy
BCUC letter to participants, October 16, 2009
October 06, 2009
Pollution charges laid in dramatic Burnaby oil pipeline rupture
Larry Pynn , Vancouver Sun, October 5, 2009
METRO VANCOUVER -- The B.C. Ministry of Environment has laid charges in connection with the dramatic rupture of a crude oil pipeline in Burnaby in 2007.
Kinder Morgan Canada and Trans Mountain Pipeline are each charged with seven counts, and B. Cusano Contracting and R.F. Binnie & Associates each with six counts under the federal Fisheries Act, federal Migratory Birds Convention Act, and provincial Environmental Management Act.
Scott Norris, a provincial conservation officer with the commercial environmental investigation unit, said in an interview Monday that the investigation was conducted in cooperation with Environment Canada.
Each count carries a maximum potential fine of $1 million.
The case was remanded Monday in Vancouver provincial court until Jan. 13, 2010.
A federal transportation safety board report last March concluded that failure to verify the accuracy of 1957 design drawings indicating the location of the pipeline led to a contractor's excavator bucket causing a massive rupture.
That oversight was among a series of errors leading to the July 24, 2007, spill of 234 cubic metres of crude oil on Inlet Drive.
The board found that no one determined ahead of time that the drawings were inaccurate; rather than running in a straight line, the 610-millimetre-wide pipeline actually snaked its way to the Westridge terminal.
The pipeline, which was operated by Kinder Morgan and owned by Trans Mountain Pipeline, ruptured at 12:31 p.m. during digging of a parallel trench for a new City of Burnaby storm sewer line on Inlet Drive.
The 1957 design drawings showed a "constant offset of 8.5 metres from the east property line of Inlet Drive" but in fact the offset varied between four and almost 10 metres, the board found.
It was assumed by all parties that the sewer line would maintain a distance of 2.8 metres from the oil pipeline.
The report said that Burnaby and Kinder Morgan signed an agreement allowing for the sewer construction that required in part for a Kinder Morgan inspector to verify the depth and location of the 4.1-km pipeline, which delivers crude oil from above-ground tanks to tankers at Westridge dock.
A Kinder Morgan inspector using a radio-detection hand-held pipeline locator verified the location of the oil pipeline along only about a 30-metre stretch on July 16, 2007.
The contractor did not ask for a greater area of the pipeline to be checked, and the inspector did not offer to do more, even though an alignment discrepancy had been noted between the 1957 drawings and another construction drawing from previous work.
The report also found that "inadequate communication" within Kinder Morgan and between Kinder Morgan and the consultant and contractor on the project resulted in "no common understanding or acceptance of the project work plan and the contractor's construction schedule."
Burnaby hired B. Cusano Contracting and engineering consultant R.F. Binnie & Associates for the job.
The board found that the amount of oil released was greater than necessary because the flow was cut off to a tanker after the rupture and "was not in conformity with standard emergency shutdown procedures."
Crude oil spewed up to 15 metres in the air for about 25 minutes before the oil flow was stopped, affecting 50 homes and properties and the waters of Burrard Inlet.
The report said 210 cubic metres of oil were recovered. There was no explosion or fire and no injuries in the rupture, although several people were sprayed with oil.
About 250 residents voluntarily left their homes.
lpynn@vancouversun.com