December 29, 2005

A Natural Gas OPEC?

Peak Energy Blogspot
01-Apr-2005

The concept of a natural gas OPEC is becoming less far-fetched. On Apr. 25-27, a little-known, four-year-old organization called the Gas Exporting Countries Forum will meet in Port of Spain, Trinidad and Tobago. Although the organization says it wants to promote cooperation with gas-consuming nations and "does not seek to control...pricing and supply," in past meetings members have discussed mutual efforts to capture a bigger share of the wealth generated by their own natural resources. That's exactly the line of inquiry that led to the formation of the Organization of Petroleum Exporting Countries 45 years ago.

Natural gas meets one key requirement for price-fixing: a high degree of market concentration. In the last quarter of 2004 members of the forum accounted for 53% of the natural gas imported by the industrialized nations belonging to the Organization for Economic Cooperation & Development. That's in line with the 52% share of OECD oil imports that OPEC provided in the quarter, according to the International Energy Agency. The Trinidadian hosts list the countries invited as forum members as Algeria, Bolivia, Brunei, Egypt, Indonesia, Iran, Libya, Malaysia, Nigeria, Oman, Qatar, Russia, Trinidad, United Arab Emirates, and Venezuela. Many are OPEC members and thus know a thing or two about price-fixing. Norway, Argentina, and Equatorial Guinea have been invited to observe.

Posted by Arthur Caldicott at 11:20 PM

December 16, 2005

Cancelled: Surrey & Vancouver Island
VITR&VIC Town Hall Meetings

BCTC-VITR & Sea Breeze-VIC Revised Hearing Schedule: Hearing now set for Mon, 06-Feb-2006

Tsawwassen meeting date changed to Jan 14 at 9:00 am to accommodate a large number of registrants

Wed, 21-Dec-2005
Intervenor Evidence with respect to the VIC Application

Fri, 06-Jan-2006
Hul'qumi'num Treaty Group rebuttal evidence

Sat, 07-Jan-2006
Town Hall Meeting (Salt Spring)

Mon, 09-Dec-2005
BCUC and Participant Information Requests to Intervenors with respect to the VIC Application

Sat, 14-Jan-2006
Town Hall Meeting (Tsawwassen)

Mon, 23-Jan-2006
Intervenor Responses to Information Requests with respect to the VIC Application

Thu, 26-Jan-2006
Staff Issue Hearing Issues List

Mon, 30-Jan-2006
Opening Oral Submissions

Wed, 01-Feb-2006
Proponent Consolidation of Hearing Issues List

Fri, 03-Feb-2006
Panel issues Hearing Issues List

Mon, 06-Feb-2006
Public Hearing commences

A-45 BCUC letter re BCTC VITR & Sea Breeze-VIC.pdf

Posted by Arthur Caldicott at 05:47 PM

December 15, 2005

Clean-Energy Frenzy in Washington State

As the Northwest struggles with soaring fuel and electricity prices, corporate executives and entrepreneurs are joining politicians and activists to develop cleaner, smarter, and self-reliant energy sources.

by George Howland Jr.
Seattle Weekly
December 14 - 20, 2005

Gov. Christine Gregoire is touring the state with a farmer who grows mustard seed used to make biodiesel. U.S. Sen. Maria Cantwell, D-Wash., is demanding that oil executives testify under oath about record profits. First District U.S. Rep. Jay Inslee's crusade for a clean-energy future has been embraced by the leadership of the Democratic Party as a central message for the 2006 elections. After a lengthy study of the cheapest way to generate electricity, Puget Sound Energy, the state's largest private utility, has bought two huge wind farms. Moses Lake Republican state Rep. Janea Holmquist is pushing a law to require the use of up to 10 percent biofuels to run vehicles in the state. Shell Oil has invested in a company building a cellulosic ethanol plant in Idaho. The Northwest Energy Coalition, an environmental group, is planning a voters' initiative to mandate use of clean energy by Washington utilities, because while public support for a policy is strong, legislators won't pass such a law.

Welcome to America's first energy crisis of the 21st century. Northwest politicians and activists are responding to the soaring prices of gas and oil by attacking the status quo, while corporate executives and entrepreneurs are embracing alternatives previously relegated to the fringe.

The latest energy crisis is due to a number of factors. The disastrous invasion of Iraq, of course, has highlighted the military and political costs of dependence on oil from the Middle East. Says Inslee, a Bainbridge Island Democrat: "We are addicted to oil from that region. That's unhealthy for our own security." Hurricanes Katrina and Rita disrupted oil and gas supplies, driving prices higher, and created opportunities for profiteering by big energy companies. "There is no valid reason our gas prices went up after Katrina," claims Democratic Gov. Gregoire. Scientific consensus has developed more strongly around the relationships among global warming, the burning of fossil fuels, and climatic changes. "We are a coastal state fighting desperately against global warming," says the governor.

In the short term, all of this protest and recognition of problems isn't going to do anything to change the high cost of energy or dependence on foreign oil. "Americans will spend over $200 billion more on energy this year than they did last year," says Cantwell, a member of the Senate energy committee. Washington consumers have seen the price of a gallon of regular gas soar from $2.09 to $2.91 in September and drop back to $2.33 last week, according to the American Automobile Association. The Northwest Energy Coalition estimates that the average Washington household will pay $700 more to heat their home this winter than last year.

Even if remedies are not immediate, clean-energy activists and sympathetic politicians hope to use public concern over high energy costs to promote alternatives to fossil fuels. At the federal level, Washington leaders like Inslee and Cantwell are unlikely to make much progress. "Congress is still in the thrall of the oil and gas industries," says Inslee.

At the state level, however, real progress has already occurred, and more is likely. This is no accident. It's the result of activists, politicians, and entrepreneurs working together to build a clean-energy future. Take the Apollo Alliance, named after President Kennedy's initiative to put a man on the moon. It's a broad coalition of environmentalists, organized labor, business executives, civil rights leaders, and politicians, and both Cantwell and Inslee are on the national advisory board. Gregoire is one of nine governors who have endorsed Apollo's call for energy independence within a decade by investing in $300 billion worth of clean-energy infrastructure. The alliance is promoting three areas of benefit that will flow from the clean-energy initiative. The first is energy independence, a goal endorsed by a broad political spectrum, from neoconservatives to greens. The idea is that if the United States can produce its own energy instead of relying on imported fuel, there will be geopolitical benefits, too. Energy independence would free us from the need for imperial wars in the Middle East. Second, clean energy addresses the planet's environmental crisis. It reduces pollution of air, land, and water. It reduces the climate-changing impacts caused by the burning of fossil fuels. Third, the alliance believes, such an undertaking would create 2 million to 3 million new, high-paying, permanent jobs.

That's a long way from where we are today. The nightly news brings flesh-and-blood reminders of the cost of our reliance on Middle East oil. Our national government is a pipeline of corporate welfare for environment-besmirching oil and gas companies. At the state level, Washington has a tiny clean-energy industry. Tony Usabelli, director of the Energy Policy Division at the state Department of Community Trade and Economic Development (CTED), says his department will soon release a report on the clean-energy sector, which employs only around 3,000 to 4,000 people and has annual sales of a mere $900 million. While Usabelli notes that the industry has grown from $750 million in sales in the past five years, "The numbers are smaller than I would have expected."

The sexy star of the industry is biodiesel. Although there is only one biodiesel refinery in the state, which employs 12 people, and no biodiesel crops are grown commercially in Washington, biodiesel has captured the media's, the public's, and the politicians' imaginations.

The rising star of the clean-energy industry is wind electricity generation, which is primed for major growth due to a convergence of technological improvement, federal subsidy, and the rapid escalation in price of its chief competitor, natural gas­powered generation.

The largest player in the clean-energy industry is efficiency­energy conservation. Energy efficiency companies employing technologies like compact fluorescent lightbulbs are the sector's largest employers and save far more energy­in effect, generate far more­than any "renewable" energy source except hydroelectricity generation. Renewable energy is that which comes from resources like water, wind, and crops. They cannot be exhausted. Oil and coal, on the other hand, are finite.

Biofuels, wind, and energy efficiency are worth exploring in detail, because they are emerging in the Northwest and illustrate where we are and how far we have to go before we can realize Apollo's vision.

What is happening on the shores of the Duwamish River in Seattle is either the start of an industrial revolution or the answer to a Trivial Pursuit question in 10 years. In a 7,000-square-foot warehouse next to a cement plant, Seattle Biodiesel has opened the state's first biodiesel refinery.

Biodiesel is made from vegetable oil and can be used in most car and truck diesel engines. Currently, Washington consumes around 1 billion gallons of conventional diesel fuel and 1.5 million to 2 million gallons of biodiesel annually, according to Usabelli of the state Energy Policy Division. Biodiesel has many advantages over its petrochemical cousin, conventional gasoline, explains Patrick Mazza, a researcher at Climate Solutions, an environmental group focused on the Pacific Northwest and Vancouver, B.C. Biodiesel is relatively simple to make and can be manufactured without creating significant toxic by-products. In vehicle engines, biodiesel burns cleaner than petrochemical diesel. "It offers really dramatic reductions in air toxicity," says Mazza. The one problematic emission from biodiesel-fueled vehicles is nitrogen oxide, which is not an air pollution concern in Washington but is in California and has kept the fuel from taking off commercially in the Golden State.

Biodiesel can be used alone or blended with conventional diesel. The latter is recommended if the temperature drops below freezing.

Since the fuel is made from vegetable oil, it can be produced domestically. While biodiesel can be made from waste vegetable oil and produced in a garage, the industry is not one of anticapitalist ecotopians. The fuel's source is produced by agribusiness cooperatives in the Midwest that grow soybeans conventionally and have banded together to build refineries to supply a new market. The National Biodiesel Board, an industry group, says last year 25 million gallons of biodiesel were sold in the U.S., up from 500,000 gallons five years ago.

Biodiesel's big disadvantage is that it costs more to buy than conventional diesel. Last week, at Laurelhurst Oil, a University District gas station, conventional diesel was selling for $2.79 per gallon, while biodiesel cost $3.17.

Seattle Biodiesel CEO Martin Tobias says his company's refinery can make 5 million gallons of biodiesel a year. Seattle Biodiesel started selling the product in May and, in the first six months, sold more than 360,000 gallons. The company started two years ago when commercial airline pilot John Plaza, now the company's president, mortgaged his home, sold his boats and cars, and borrowed against his 401(k) plan to get the alternative fuels venture up and running. Software entrepreneur Tobias, a former Microsoftie and founder of the streaming media company Loudeye, officially became the company's CEO in May. Seattle Biodiesel brings soybean oil from Iowa by rail. In huge tanks that have been recycled from the old Rainier Brewery on Interstate 5, the soybean oil is refined to a purer state.

Tobias says his company cannot fill all the orders it gets. Seattle Biodiesel hopes to have a second refinery up and running by the middle of next year. Tobias says the industry does not need a separate distribution infrastructure, because traditional tanker trucks can haul biodiesel and conventional diesel tanks can be easily converted to pump biodiesel at service stations. The National Biodiesel Board lists 29 service stations where biodiesel is currently available in Washington, all but one in the Puget Sound region.

Washington politicians are giddy about biodiesel. It's easy to see why. Gov. Gregoire quotes John Steinbeck: "The bank is more than men; it is a monster." Says the governor, "Replace bank with foreign oil." She sees biodiesel as an opportunity to tear down the Cascade Curtain and unite the red and blue parts of the state. "This is an opportunity for us to work together as a state," she says enthusiastically. Washington has the agricultural potential east of the mountains to grow oil-seed crops. Mustard seed and canola seed (aka rapeseed) are the most frequently mentioned. Oil-seed crops can be grown in rotation with others­wheat, for instance­throughout Eastern Washington. Western Washington consumers, with their liberal politics and environmental values, represent a great market for the product­even if it's more expensive.

Right now, it doesn't make economic sense, however, for Washington farmers to grow oil-seed crops, because the market won't pay enough to make it worthwhile.

On Jan. 9, the Legislature will convene for its annual session, and biofuels for vehicles are going to receive some kind of boost. "We need to seize the crisis as an opportunity," says Gregoire. "Maybe this time we can come together and seize a common agenda. If we wait another legislative session, the crisis may be gone and apathy will set in." Republicans and Democrats agree there will be a host of tax breaks for everything connected to biodiesel, but some legislators want to go further.

House Capital Budget Committee Chair Hans Dunshee, D-Snohomish, wants to use state money to build the big, expensive crushers that convert oil-seed crops into oil. Since the state constitution prohibits direct payments to private industry, Dunshee says the money would likely go to an Eastern Washington port district or some other governmental entity. "Canola will get grown," Dunshee predicts. "It will get crushed." He says farmers in the central Washington area of Odessa, in Lincoln County, have been working with Seattle Biodiesel and are the group that has most fully developed a business plan. "The economics are still iffy," Dunshee admits. But, "It's better than a stadium."

The most controversial idea is to require that a certain percentage of the state's gasoline and diesel supplies be biofuels by a certain date. Seattle Biodiesel CEO Tobias says these so-called fuel standards are the most important thing government can do for the biofuels industry. "If the government does these renewable fuel standards, that gives the investors a long-term reason to invest in these industries," he says. Last year, the Minnesota Legislature passed a law that requires gasoline there to be 20 percent ethanol by 2013. In Washington, Democratic and Republican lawmakers will push mandatory standards for both biodiesel and ethanol.

While the Democrats are extremely supportive of the idea and have plenty of votes in the House to pass such legislation, Republicans in the Senate are not as enthusiastic. Senate Minority Leader Bill Finkbeiner, R-Kirkland, who announced last month he is stepping down from his post, cautioned that his caucus doesn't like to see a lot of interference with free-market capitalism. Finkbeiner says, "I don't want to be knee-jerk against it, but if you just set an arbitrary standard, you haven't really done the job." Since the Democrats only control the Senate by three votes, and two conservative Democrats frequently vote with Republicans, fuel standards are not a sure thing. It should help that GOP legislators from Moses Lake­Holmquist and Sen. Joyce Mulliken­are in favor of standards. Oil-company lobbyists, however, have already been calling lawmakers to express their unhappiness. "We oppose mandates," says Frank Holmes of the Western States Petroleum Association.

Of course, diesel is not the dominant fuel in Washington or anywhere else. "Our biggest use of energy is petroleum­4.7 billion gallons of gasoline in Washington's cars and trucks," says state economic development official Usabelli.

The current "green" candidate that can be blended with gasoline is cellulosic ethanol. Currently, corn-based ethanol dominates the market, but it is considered inferior because it takes more energy to make than it provides. Cellulosic ethanol uses agricultural waste like wheat straw to create ethanol and uses less energy to boot. Iogen, a Canadian company, with one of its investors, Shell Oil, wants to build the first American cellulosic ethanol plant in Idaho. The industry has potential but no reality.

While the Legislature has gone gaga over biofuels, members express no such enthusiasm for boosting renewable clean electricity. This is both good and bad news. It's good because it means that the clean-electricity industry is already doing well, so well that even key Democratic legislators, like House energy committee Chair Jeff Morris, D- Anacortes, are not convinced more needs to be done. It's bad news because "dirty" electricity from coal burning might see its market share rise in the Northwest because clean electricity isn't getting enough help.

The most dramatic evidence of clean electricity's strength is the enthusiasm of Puget Sound Energy (PSE), the state's largest electric utility with 1.2 million customers in eight counties. State regulators require utilities to extensively study what the lowest-cost alternative is for their future energy needs. PSE began energy acquisition planning in 2004, received 100 proposals from energy developers, and found that the best two projects were wind farms: Hopkins Ridge Wind Project in southeastern Washington's Columbia County and Wild Horse Wind Power Project in central Washington's Kittitas County.

In those breezy parts of the state, huge wind-driven blades­on towers up to 200 feet tall­drive generators. Windmills are clean, quiet, ugly, and take up a lot of space. For instance, Wild Horse is being built on 9,200 acres of open rangeland, 11 miles east of Ellensburg.

PSE's two new wind farms will boost wind's tiny share of the state electricity market considerably. Washington uses around 10,500 average megawatts (aMW) of electricity annually. Hydroelectricity accounts for 66.6 percent of Washington usage, coal is next at 17.7 percent, natural gas is third at 9.8 percent, and nuclear power accounts for 4.6 percent. Wind is a mere 0.4 percent, or 42 aMW annually. PSE's wind farms will add 114 aMW to the mix.

Wind energy has become economically viable for a number of reasons. First, newer wind turbines are more efficient. Second, the cost of the most popular new source of electricity in Washington in recent years­natural-gas-fired turbines­has skyrocketed. Natural gas prices have increased from between $2 and $3 per million British thermal units (Btu) in 2004 to $8.50 per million Btu this year, and the price is expected to rise to $10 per million Btu next year. Finally, the federal government provides a subsidy to operators of wind farms that brings the cost down from between $40 and $50 per megawatt hour (MWh) to $32.

All of this has convinced the Northwest Power Planning Council (NWPPC), a regional planning entity created by the federal government, that wind can produce 100 new aMW per year over the next 20 years in Washington, Oregon, Montana, and Idaho. The NWPPC estimates that the region's use of electricity will grow by around 360 aMW per year, so wind will become a major player. Like biofuels, wind is not an anticorporate ecotopian industry. The major U.S. supplier of wind turbines is General Electric; they bought the business from Enron.

Also like biofuels, wind has competition from a cheap fossil-fuel alternative: coal. Environmentalists want to keep wind growing and limit coal's development by enacting a renewable energy portfolio­essentially, the equivalent of fuel standards for electricity. Activists and legislators agree that mandatory goals for clean electricity will not pass the Legislature. Environmentalists, led by the Northwest Energy Coalition, have pushed the measure in Olympia for the past three sessions and have been unsuccessful. Democratic state House energy committee Chair Morris doesn't support the idea. He says the proposal he has seen would require that 20 percent of new energy be from renewable sources. "The folks who are acquiring resources are already acquiring 60 percent renewable resources," says Morris. So there's no need for a renewable energy portfolio, he argues.

Northwest Energy Coalition spokesperson Marc Krasnowsky says Morris is focusing on the positive steps taken by Puget Sound Energy in his analysis of the energy market. Not all utilities are behaving so well, says Krasnowsky. "Utilities in the Northwest have the potential of adding 2,000 megawatts of new coal in the next five to 20 years," he says. A renewable energy portfolio, Krasnowsky argues, would discourage the development of that industry. He agrees with Morris, however, that the measure cannot pass the Legislature. Instead, Northwest Energy Coalition is planning to put an initiative requiring a renewable energy portfolio on the ballot in 2006. Notes Senate Water, Energy, and Environment Committee Chair Erik Poulsen, D­West Seattle, who supports a renewable energy portfolio: "Olympia has shown itself to be resistant to a renewable energy standard for years. The environmental community has a better chance of convincing the public."

But Democrats think they have a winning issue in clean energy in general. Cantwell, who is facing a tough re-election fight against former Safeco Insurance executive Mike McGavick, has begun putting a clean-energy logo on her press releases. She has led the Senate fight against drilling in the Arctic National Wildlife Refuge in Alaska. She championed legislation that would have outlawed "gas-price gouging." Inslee says, "In November '06, energy will be one of the fundamental choices of the American people, because the Democrats are making it so. When the Democrats stand for optimism, we win. I've been arguing this for two and a half years!" Inslee says the leadership of the Democratic Party has finally figured out that clean energy is an issue with which they can win. Whether a clean-energy ballot measure will help boost wind remains to be seen.

Labor leaders in Washington have also signed on with the clean-energy push. Wind energy, however, is not a huge job generator. There are good jobs during the construction of the wind farms, but once the farms are up and running, they do not require a large workforce.

But there are jobs that emerge from wind in surprising places. Down in South Seattle's Georgetown neighborhood, the Gear Works is the best local illustration. The 49-year-old, 110-employee, family-owned business is a throwback. The Gear Works is housed in a pair of wonderful warehouses that were designed by the business' late founder, Ingwald Ramberg. A huge trellis with a rambling wisteria vine covers the three-story southern wall of the main warehouse, and there is a homemade fountain out front. Inside, original posters from Seattle's 1962 World's Fair complement the '60s feel of the architecture. While the place feels frozen in time culturally, Ingwald's son, Roland Ramberg, the firm's president, has made sure the business is on the cutting edge in equipment and pursuit of new markets. The Gear Works makes and repairs industrial gears for everything from draw bridges to race cars to wind turbines. Ten years ago, Ramberg says, the Gear Works did no work on wind turbines. Now it is 20 percent of the business. "We are not only repairing them but building new gear boxes," Ramberg says. "They keep putting up thousands of new machines every year. Those are future customers going up. They are making them more reliable, but sooner or later, they are going to need work," Ramberg says of the turbines. Most of his wind business is from California wind farms, but as the Pacific Northwest's wind sector expands, Ramberg should get plenty more business from nearer by. Ramberg says that's one of the reasons he has built a 20,000-square-foot test-and-repair facility with help from a grant from the U.S. Department of Energy's National Renewal Energy Laboratories. "When your wind turbine starts crapping out, we want to be the place you think of," says Ramberg. Even at the Gear Works, however, wind finds itself in competition with coal. Ramberg points out that 25 percent of his business involves conveyer belts for coal mines in China. Until coal is made to pay for harm from its emissions, wind will keep playing catch-up.

The state's largest industry for clean energy is invisible. That's because the energy- efficiency industry saves energy rather than generates it. In the 1970s, energy efficiency was known as conservation. Northwest Energy Coalition's Krasnowsky explains the reason for the name change: "Conservation creates an image of huddling under a blanket in the dark."

Whatever it's called, saving energy is the first choice of private utilities, environmentalists, and public-policy experts when it comes to dealing with an energy crisis. The Northwest has been very successful at employing energy-efficiency strategies over the past 20 years. Tom Eckman, the Northwest Power Planning Council's manager of conservation resources, says that from 1982 through 2002 the region met 40 percent of the need for new electricity. That's 2,500 aMW of energy savings. "You don't see that built," says Eckman. "It's one lightbulb, one piece of insulation, and one showerhead at a time." The NWPPC estimates that the Northwest will find new energy savings equivalent to 2,500 more aMW over the next 20 years. The biggest saver? "Changing the lightbulb," says Eckman­replacing incandescent lightbulbs with compact fluorescent ones.

In industrial plants and office buildings, the latest technology for heating, ventilation, and air conditioning (HVAC), motor drives, conveyers, and pumps is providing precise computer control over everything from lighting to room temperature. "The direct digital control in commercial buildings is a real improvement in terms of creature comfort and energy efficiency," says Eckman. He notes that there is another technological revolution right around the corner as computer controls go wireless, reducing the cost of installing new systems by eliminating the need for stringing cables.

New digital controls are on display on the 37th floor of One Union Square, a 650,000-square-foot, 20-year-old office building in downtown Seattle. "I get so excited when I see this stuff," says Rick Mock, the director of facilities for Washington Real Estate Holdings, which manages One Union Square. As he shows me a computer screen displaying the "chiller system" with graphic and numeric elements, I can understand about one-tenth of what Mock is telling me. But there is no mistaking his enthusiasm. Mock's fascination with the latest gadgets and his zeal to improve the building's energy usage have translated into savings of $450,000 a year in electricity. Mock arrived at One Union Square in 1999 and noticed immediately that he received a lot of complaints from tenants about being too hot or too cold. He began to evaluate the building's HVAC and lighting systems and started to advocate for a major overhaul. "This building was a runaway train," he says. "We had to do something." After working with Seattle City Light and other managers at Washington Real Estate Holdings, the company undertook a $3.5 million renovation of HVAC and lighting. City Light kicked in $750,000 of the overall cost, reducing the time for the project to pay for itself to six years. "It's a neat initiative from a monetary standpoint and from the environmental standpoint," says Tim Holt, vice president at Washington Real Estate Holdings. As an added benefit, tenants are happier now. Mock fields far fewer complaints about temperature.

McKinstry, a 35-year-old, 650-person mechanical contracting company, did the work at One Union Square. Highly respected in the field, McKinstry is an example of a large energy-services firm that has a mature business in energy efficiency but does not rely on that sector alone. Stan Price, executive director of the Northwest Energy Efficiency Council, an 80-company trade group, says the industry includes Fortune 500 companies like Johnson Controls and Siemens as well as small specialty shops and midsized energy firms. Price has watched the industry expand and contract over the past 25 years as energy prices have risen and fallen. "We are in a marketplace more driven by energy prices than we would like," says Price. He predicts there will be no problem meeting the increased demand that the latest round of energy price spikes will engender. Price believes that the lion's share of employment and sales in the state's clean-energy sector are in energy efficiency. Yet he acknowledges that energy efficiency doesn't get the same kind of buzz that surrounds less-significant industries like biofuels. "It's a bit of a sleeper," he says.

Politicians are not clamoring with new proposals to encourage energy efficiency. Last year, the Legislature did pass the nation's first "green building" standards for new construction of public facilities. Mandating new energy efficiency for private construction would be a welcome innovation, but no legislative champion has emerged. Many utilities, though, both public and private, offer grant programs to encourage conservation. Washington state Apollo Alliance coordinator Rich Feldman would like to see Gov. Gregoire launch an ambitious $100 million, zero-interest loan program for retrofitting public buildings with the latest energy- efficiency equipment. The improvements would pay for themselves with the savings, he claims. So far, Gregoire has not adopted the proposal, but she hasn't rejected it, either.

The task facing clean-energy advocates is daunting. The industrial and political challenges ahead are huge. But if we need any flesh-and-blood reminder of how disastrous our nation's current energy policy is, just turn on the nightly news and be reminded of the cost of our reliance on Middle East oil. While a clean-energy future seems a challenge, it's unimaginable that a dirty, blood-soaked energy future will be possible to bear.

http://www.seattleweekly.com/

Posted by Arthur Caldicott at 01:19 PM

Dec 15 - Last day to register for VITR & VIC Town Hall Meetings

The BC Utilities Commission (BCUC) is conducting a consolidated review of two cable projects being proposed to bring mainland power to Vancouver Island. Part of the proceeding includes four "Town Hall Meetings" in communities on the routes of the proposed transmission lines. These are Surrey, Tsawwassen, Salt Spring Island and Duncan, on Vancouver Island.

Presenters must pre-register with the Commission Counsel. The registration deadline is Thursday, 15 December, 2005.

THAT'S TODAY!

To register, contact Mr. Gordon Fulton, Commission Counsel by email at gfulton@boughton.ca or by telephone at (604) 687-6789.

Other important things to know:

- Presentations are limited to ten minutes.
- A presentation projector will be provided if you wish to use a computer.
- If fewer than six presenters register for any specific town hall meeting, that meeting may be cancelled.
- Intervenors who choose to present at a town hall meeting will not be permitted to make a further presentation during the oral hearing.

More information and guidelines about these specific town hall meetings is available in three documents issued by the BCUC.

A-39 Notice of Town Hall Meetings
http://tinyurl.com/dfnag
A-41 What can I expect at the Town Hall Meetings and Oral Public Hearing?
http://tinyurl.com/bqwua
A-44 More rules about Town Hall Meetings
http://tinyurl.com/d64ca

BCTC-VITR & Sea Breeze-VIC Hearing Schedule

Action Date
Mon, 19-Dec-2005 BCUC and Participant Information Requests to Intervenors with respect to the VIC Application

Fri, 06-Jan-2006 Intervenor Responses to Information Requests with respect to the VIC Application

Fri, 06-Jan-2006 Hul'qumi'num Treaty Group may file rebuttal evidence to BC Hydro/BCTC evidence relevant to consultation and accommodation

Sat, 07-Jan-2006 Town Hall Meeting (Salt Spring)

Tue, 10-Jan-2006 Town Hall Meeting (Tsawassen)

Thu, 12-Jan-2006 Staff issue Hearing Issues List

Sat, 14-Jan-2006 Town Hall Meeting (Vancouver Island - Duncan)

Mon, 16-Jan-2006 Opening Oral Submissions

Wed, 18-Jan-2006 Proponent Consolidation of Hearing Issues List

Thu, 19-Jan-2006 Town Hall Meeting (Surrey)

Fri, 20-Jan-2006 Panel issues Hearing Issues List

Mon, 23-Jan-2006 Public Hearing commences

The BCTC-VITR and Sea Breeze-VIC cable projects are being reviewed in a consolidated hearing by the BC Utilities Commission.

BCTC-VITR: BC Transmission Corp. - Vancouver Island Transmission Reinforcement, 230 kV AC cable from Delta to Duncan
http://www.bcuc.com/ApplicationView.aspx?ApplicationId=78

Sea Breeze-VIC: Sea Breeze Pacific Regional Transmission System Inc. - Vancouver Island Cable, 300 kV HVDC Light cable from Surrey to Victoria
http://www.bcuc.com/ApplicationView.aspx?ApplicationId=90

Posted by Arthur Caldicott at 01:08 PM

December 14, 2005

Victoria, Hydro drag heels on alternative energy

By Don Whiteley
Vancouver Sun
14-Dec-2005

The provincial government's abrupt decision a week ago to send BC Hydro back to the drawing board on its 20-year Integrated Electricity Plan (IEP) is one more indication that this province is suffering from a severe case of constipation when it comes to future electric power needs.

The move comes only a couple of months after Hydro itself abruptly withdrew its application to build a natural gas-fired power generating station at Duke Point on Vancouver Island. Given today's natural gas spot price of $14 per thousand cubic feet, perhaps that's a blessing in disguise. But at the time, it was a serious slap in the face to the province's independent power producers.

Further to that decision, Hydro's call for additional power supply from independent producers, originally scheduled for the fall, is now going to happen in the new year. Hydro just posted the terms of the call on its website last week.

And there's growing evidence that B.C. is falling well behind almost every other jurisdiction in the country -- if not in North America -- when it comes to promoting the use of alternative energy supplies such as wind or tidal power. While other provinces are installing wind turbines, B.C. is still putting roadblocks in the way.

All this is coming when it is now clearly recognized that the province can't meet its energy needs through conservation alone, and as Hydro's reliance on external power sources -- it now imports more than 10 per cent annually -- continues to grow. Less than a month ago, the B.C. Progress Board chastised the province for twiddling its thumbs on this issue for the past 20 years.

Depending on whom you speak to, the fault lies either in Victoria through a provincial government that won't issue clear directions, or at Hydro where the utility has not yet built a good financial case for its marquee Site C dam project.

David Austin, speaking for the Independent Power Producers of British Columbia, thinks the Site C project is the reason Victoria balked at the IEP. In a letter to Hydro, Austin states: "If BC Hydro generating resources are to be included in some way as part of the IEP, then at a minimum, BC Hydro should have prepared and made public for scrutiny the corresponding financial models. The IPPBC has repeatedly asked for BC Hydro's Site C financial model and none has been received. As a result, the IPPBC has absolutely no confidence in the price information that BC Hydro has provided to date with respect to Site C."

Guy Dauncey, president of the B.C. Sustainable Energy Association, sees the main problem as a planning "vacuum" in Victoria, where electricity policy-making has been abandoned in favour of letting the B.C. Utilities Commission call the shots.

"There's a very clear policy vacuum," says Dauncey. "Last year we missed the opportunity to have a major wind-assembly plant built in B.C. -- probably Squamish -- because of the policy vacuum. They were looking for a place at the end of a rail line to put a wind-assembly plant. They wanted B.C. to put 1,000 megawatts of wind power into the grid to show there's a local market."

Dauncey's association produced a recent report that document's the potential for alternative energy potential in the province.

"Wind, solar, tidal, geothermal and other technologies, combined with energy savings from efficiency measures, would produce 84,000 gigawatt hours a year," his report states. "This is 50 per cent more than BC Hydro's current total generation, and enough power for 8.4 million homes."

In an interview, Dauncey said no jurisdiction in North America is better situated for the advancement of "green" technologies: "We are the most favourably placed jurisdiction in the whole of North American for having 100 per cent green power."

But while Alberta, Manitoba, Quebec, New Brunswick and Prince Edward Island are in the forefront of developing wind power, B.C. has yet to build its first commercial projects, although two have been approved -- Sea Breeze Power Corp. for a project on northern Vancouver Island, and Nai Kun Wind for a project on Haida Gwaii

Sea Breeze has approval to build a 450-megawatt wind farm, but hasn't been able to reach an agreement yet with BC Hydro to buy the power.

Instead, the company last month applied to the National Energy Board for permission to build a 550-mw undersea power cable from Victoria to Port Angeles so it can sell power into the U.S. market.

Tidal power has huge potential too, with three companies on Vancouver Island in various stages of development, one only months away from a pilot project at Race Rocks designed to prove the concept. But there is unhappiness in this area, too.

"That's our Niagara Falls," says Michael Maser, communications director at Blue Energy Canada Ltd. "But we're not pumping a single kilowatt of tidal energy in this province. That's staggering."

Blue Energy hopes to tap tidal power with a project in Johnstone Strait north of Campbell River.

Dauncey concurs, pointing out that the United Kingdom is pouring millions of pounds into the development of tidal energy in recognition of its value as an emerging technology.

"Tidal is the firmest of the non-firms because you can predict it, and you know exactly when it's coming in," he said "At the moment, we're losing the race. Britain is jumping ahead and throwing money at tidal energy."

All these developments lead to serious concerns that neither Hydro nor the province are moving quickly enough, nor are they prepared to provide sufficient catalysts to get alternative energy projects moving.

A provincial Task Force on Alternative Energy was recently struck and is expected to issue a report in the new year, while at the same time the Ministry of Energy Mines and Petroleum Resources is revising its overall energy policy.

Other jurisdictions are building things.

don_whiteley@telus.net

Posted by Arthur Caldicott at 12:23 PM

December 13, 2005

Government yanks BC Hydro's chain

Political squeamishness sinks Hydro's plans to talk about electricity
Vaughn Palmer, Vancouver Sun, 08-Dec-2005
Government concern about Site C dam stalls power plan
Scott Simpson, Vancouver Sun, 08-Dec-2005
Hydro's a political animal once again
Paul Willcocks, Times Colonist, 09-Dec-2005
Cabinet says it needs time to review Hydro energy plan
Scott Simpson, Vancouver Sun, 09-Dec-2005
We need bright lights to develop hydro projects
Editorial, Vancouver Sun, 10-Dec-2005
Victoria finally notices Hydro's bumbling
Brian Lewis, The Province, 11-Dec-2005
Hydro needed to have its plug pulled
Les Leyne, Times Colonist, 13-Dec-2005



Political squeamishness sinks Hydro's plans to talk about electricity

By Vaughn Palmer
Vancouver Sun
08-Dec-2005

VICTORIA - The B.C. Liberals have intervened directly in the management of BC Hydro, forcing the giant utility to pull the plug on a major announcement about the development of electrical power.

The announcement, set for today at 10 a.m., would have seen the release of Hydro's long-in-the-works integrated electricity plan.

CEO Bob Elton, flanked by business leaders, was scheduled to "reveal B.C.'s path to energy self-sufficiency for the next 20 years" as well as "outline the future of the highly debated Site C dam."

But even as the media advisory for those coming attractions circulated in provincial newsrooms, the Liberals were at work derailing it.

Though the plan had been in the works for months and the announcement for weeks, the politicians only got wind of the details Tuesday afternoon.

They didn't like what they'd heard, especially regarding Site C. Hydro was proposing to move to full-blown public consultations on the enormous and controversial third hydroelectric dam on the Peace River.

The public wasn't ready for this discussion. Heck, the politicians weren't ready, and some of them hoped to see the dam built in their lifetimes. Given the lack of extensive groundwork, the debate would surely be dominated by the critics. The premature launch could eliminate any chance to develop public support, and doom the project once and for all. In the space of a couple of hours, the Liberals decided to order Hydro to back off.

Though the decision was ultimately driven by Premier Gordon Campbell, it fell to Energy Minister Richard Neufeld to deliver the message.

It must have been tough for him. Neufeld has represented the Peace River region for more than a decade and has long advocated building a dam at Site C.

But the experience must have been far more bruising for Elton. The Hydro CEO had reason to think he'd gone about this in the right way.

Preliminary consultations with stakeholders and the public throughout the fall. Extensive planning. No big secret about Site C being one of the options.

Hydro even tried to keep the premier's office in the loop. But a briefing at the senior official level did not result in a briefing for the politicians on where this thing was headed -- until it was too late for them to do anything but slam on the brakes.

That, in turn, translated into a second media advisory from Hydro, sent out Wednesday afternoon.

"As you know, we intended to release our integrated electricity plan on Thursday," it said. "In consultation with government, we have now decided to postpone this release."

The "in consultation with government" was a nice euphemism. As opposed to "after having our chain yanked by Victoria" or "because the politicians weren't ready for a public debate on this issue now or maybe ever."

Hydro phrased it differently in a memo that went out to a committee of stakeholders who'd been invited to participate in a conference call before the release of the plan. "We apologize for the short notice but we will be cancelling the call," it said. "At the present time we are still engaged in an internal review process and in consultations with the shareholder."

The shareholder being me and thee, since Hydro is publicly owned. But in this instance we are represented, like it or not, by the politicians.

Cryptic as it was, the brief notice left no doubt that the electricity plan has been overtaken by a political agenda.

"Both government and BC Hydro have a strong desire to ensure the plan is fully reviewed in the context of government's energy policies," it said. "This will be accomplished in the coming months."

That raises a concern about the fate of a process that has, up to now, been monitored the B.C. Utilities Commission.

"We will bring forward the integrated energy plan in the new year, as required by the utilities commission," vowed Hydro, even as its scrubbed today's release.

But the whole point of delegating the planning process to the commission, is that the BCUC functions as an independent regulatory body.

The Liberals repeated that theme ad nauseam during the recent debate over a U.S. firm's purchase of Terasen gas.

The government wasn't going to step in and block or even delay the takeover. The decision was up to the utilities commission, which would render a verdict ("Yes," as it turned out) without political interference.

The Liberals said the same thing about Hydro. Decisions would be governed by the province's energy needs, by markets for power, and the public interest.

"The days of political interference are over," -- the Liberals said it again and again.

Perhaps Bob Elton and his team at BC Hydro believed them. Which must have made this week an important learning experience for all concerned.

vpalmer@direct.ca

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Government concern about Site C dam stalls power plan

By Scott Simpson
Vancouver Sun
08-Dec-2005


BC Hydro's ambitious 20-year plan for a multibillion-dollar makeover of British Columbia's electricity system hit a major snag Thursday when the provincial government ordered Hydro to back off out of concern about the controversial Site C dam project.

Hydro officials had little to say. Bob Elton, Hydro president and CEO, issued a brief statement by e-mail that the plan, which was to be unveiled today, would be delayed until an unspecified date next year.

Hydro's "Integrated Energy Plan" was expected to include a mix of small, private sector hydroelectric projects, electricity conservation initiatives, upgrades to large government-owned facilities -- and a decision to proceed with the controversial Site C dam on the Peace River near Fort St. John.

It was not immediately clear if the province's concerns were attributable to soft cost estimates for Site C -- which would cost taxpayers a minimum $3.5 billion -- or strong opposition from first nations in northeast B.C., or a conflict with independent power producers who were promised in 2002 that all new power projects in British Columbia would be developed by the private sector.

"In consultation with government, we have now decided to postpone this release and will be doing further work to ensure that this plan meets the needs of ratepayers," Elton said.

Earlier this week, some B.C. Liberal MLAs told Vancouver Sun political columnist Vaughn Palmer that they had concerns about Hydro's ability to shepherd the controversial Site C hydroelectric project -- the cornerstone of the new plan -- through to completion.

NDP energy critic Corky Evans said the province's 11th-hour involvement casts a shadow across more than a year's worth of community consultation and preparatory work by BC Hydro.

"What I find really bizarre is that it flies in the face of the Liberal mantra, maintained all through the public debate about the sale of Terasen Gas and the controversy about the [CN] railroad and all kinds of stuff, that it was not their intention to manipulate public processes or commissions or Crown corporations," Evans said.

Energy Minister Richard Neufeld was tied up in a series of meetings and could not be reached for comment.

Hydro goes through a similar planning exercise very two years, submitting details to the B.C. Utilities Commission as per its regulatory requirements.

However, this year's version of the plan was considered to be its most ambitious effort in more than a decade, in light of British Columbia's growing dependence on imported electricity to supplement a provincial resource that has not grown significantly in volume since the Revelstoke Dam was built in the early 1980s.

Earlier this month, Treaty 8 first nations in northeastern B.C. advised Hydro that they "adamantly" oppose Site C.

The construction of two earlier dams on the Peace, the W.A.C. Bennett and Peace Canyon dams, led to flooding of millions of acres of traditional hunting and fishing territory for the bands.

A BC Hydro summary of a meeting with the aboriginals reported that they "made it clear that they are adamantly against the development of Site C."

ssimpson@png.canwest.com

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Hydro's a political animal once again

By Paul Willcocks
Times Colonist (Victoria)
09-Dec-2005

The Liberals' big commitment to keep politicians' hands off Crown corporations like B.C. Hydro is fading fast.

B.C. Hydro's brightest and best have been labouring away on a long-term energy plan, with the Site C dam as the centrepiece. This week was supposed to be the big unveiling.

Hydro CEO Bob Elton announced a press conference where he would be flanked by business types, and vice-presidents were fanning out to meet with the media. And then 20 hours before the big announcement, the politicians pulled the plug.

"In consultation with government, we have now decided to postpone this release and will be doing further work to ensure that this plan meets the needs of ratepayers," Elton said in a terse news release.

Hydro's future also needs to be "fully reviewed in the context of government's energy policies."

The order was not well-received in Hydro. The 20-year Integrated Energy Plan has been more than a year in the making, with a high-profile advisory committee, public meetings and lots of consultants and studies. It was to be the definitive look at energy needs for the next two decades, and the best way to meet them.

The B.C. Utilities Commission was set to review it.

Something has gone seriously wrong when the politicians step in at the last minute, stepping all over Hydro's board and management. Energy Minister Richard Neufeld said the government wanted more time to review the plan, which was presented to Liberal MLAs at a caucus meeting this week.

The Crown corporation just got a little ahead of itself, he said. But Neufeld didn't rule out changes before the plan goes to the utilities' commission.

The explanation leaves a few questions. The government has known for a year that the plan was going to the utilities commission this month, and for days that the announcement was scheduled for this week. There were no big surprises in the document, as energy ministry officials have been involved with the process all along.

So the last-minute cancellation suggests someone -- the caucus, the premier's office -- got nervous.

There's lots to get nervous about. Hydro's assessment of energy needs and the solutions it backs will have huge implications for the provincial economy.

If it underestimates demand, B.C. will need to buy more expensive power from the U.S. If Hydro overestimates, the corporation will build power plants it doesn't need. Both would cost consumers money. If it makes the wrong choices on issues like big coal-fired plants vs. small hydro projects, the province's economy is affected.

Hydro's preferred plan is likely based on building the Site C dam across the Peace River near Fort St. John, as well as energy conservation measures and additional power from private producers.

Site C makes a lot of people nervous. The $3.5-billion project was already scuttled by opponents once, in 1991.

Independent power producers don't like the proposal, because they want to supply the electricity. First Nations have issues about lost hunting land when thousands of acres are flooded. And the accuracy of Hydro's cost projections have come under fire.

The Liberals have made much of the need to let Crown corporations operate without political interference, never missing a chance to talk about the $460 million lost thanks to the NDP's half-baked fast ferries project. But there's been increasing recognition that leaving Crown corporations to their own devices carries its own risks and missed opportunities.

The B.C. Progress Board, a business panel appointed by the premier, weighed in last month with a report saying government, not B.C. Hydro, should be setting energy policy.

"B.C. Hydro is seen by many concerned parties to heavily outweigh the ministry in staff and resources, which puts the government in the position of not being able to provide adequate oversight and direction," said the panel, chaired by Victoria newspaper mogul David Black.

The last-minute scuttling of the launch of B.C. Hydro's energy plan suggests the government has come to the same conclusion, and is reining in the Crown corporation.

Footnote: Things will get complicated quickly if the government wants significant changes to the plan. Hydro is supposed to present it to the utilities commission within the next three months. Any major reworking could make it tough to meet the deadline -- especially if B.C. Hydro's co-operation is less than enthusiastic.

willcocks@ultranet.ca

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Cabinet says it needs time to review Hydro energy plan

By Scott Simpson
Vancouver Sun
09-Dec-2005

British Columbia's increasing dependence on imported electricity was behind the provincial government's decision to order a halt to BC Hydro's plans for a multi-billion dollar system makeover, Energy Minister Richard Neufeld said Thursday.

Neufeld says the government cancelled Hydro's announcement of an Integrated Energy Plan because of a general concern that the B.C. Liberals haven't had enough time to mull all the implications of Hydro's plans.

He says Hydro has done laudable work in preparing the plan, which is supposed to outline a 20-year effort to restore British Columbia to a position of independence from U.S. electricity suppliers who now serve about 12 per cent of B.C.'s annual electricity consumption.

But he added that cabinet was not willing to green-light the plan on the basis of a 30-minute briefing on Tuesday afternoon by senior Hydro officials.

Neufeld noted that Hydro had spent "well over a year" preparing its plan, "but we didn't see it in its complete form until late Tuesday afternoon."

A proposal to build a major new dam at the Site C location on the Peace River near Fort St John, at a cost of at least $3.5 billion, was expected to be a major component of the new Hydro plan.

That project is expected to attract opposition, particularly among first nations and non-aboriginal residents of northeast B.C. who say the region already contributes more than its share of power to the provincial electricity grid.

Opponents of Hydro's plan for a gas-fired electricity generating plant at Duke Point on Vancouver Island helped kill that project, at a cost to taxpayers of $125 million.

Neufeld said cabinet believes it is important for all B.C. residents to fully appreciate the pros and cons of all proposed new major projects so that they can make an informed choice about how the province should proceed to lessen its dependence on import power.

He said the government does not want to begin to address the situation without the public first understanding what's at stake -- and does not believe most residents are aware of the problem or the government's desire for energy self-sufficiency.

"We are facing some significant challenges and I don't think that on the basis of a half hour presentation by the crown [corporation] that provides almost all the electricity in the province, that you just run with it. I think that's a recipe for some real disaster," Neufeld said.

"I don't think I want to be tied to imports for 12 per cent of our energy like we are this year. I think to be perfectly honest that's nuts because it holds us ransom -- maybe not today but at some point in time.

"We buy most of it from south of the border, and when they get to the point where they are consuming all of that electricity themselves and perhaps they haven't built any new generation, they're not going to sell to us."

Hydro had informed the media earlier this week that it would announce the plan on Thursday, but instead issued a brief statement on Wednesday to say that the announcement was cancelled.

Hydro did not elaborate.

Neufeld said he regards Hydro's plan as one of four contributing reports that will guide cabinet deliberations about a possible revision of its 2002 energy plan -- and added that cabinet is still awaiting two of those reports, one on B.C.'s alternative energy options and the other from the province's competition council.

ssimpson@png.canwest.com

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We need bright lights to develop hydro projects

Editorial
Vancouver Sun
10-Dec-2005

The Liberal government and B.C. Hydro have stumbled badly in the development of a crucial plan to maintain an ample supply of electricity for the next 20 years.

At the last minute this week, the government ordered Hydro to cancel the unveiling of its Integrated Energy Plan, which has been under development for more than a year.

The government's intervention is disturbing at a number of levels. First, it flies in the face of the Liberals laudable promise to end political interference in Crown corporations.

If government officials have no confidence in the executive and board of directors of B.C. Hydro, they should replace the board with one in which they can have confidence. By undercutting the board, the government has further damaged Hydro's reputation as a stable partner for private sector investors in energy projects.

Hydro's credibility in that regard was already in some doubt following its astounding decision last year to pull the plug on the Duke Point project, leaving its private partner in the lurch and its customers with a bill of $125 million for which they will get nothing in return.

Just as importantly, this debacle comes on the heels of another report last month from the B.C. Progress Board that pointed out the urgent need for developing new electrical production capacity to protect our standard of living.

In the past, we've been been pretty smug about our energy resources, especially our hydro dams. But no significant new capacity has been added in the past two decades while our population has grown by a third.

B.C. still makes money by exporting power during peak demand periods in the U.S. and importing it when spot rates are lower. But we are now in a slow squeeze, with the imported portion of our electricity supply growing more costly every year. More urgently, as is happening in Ontario, any dependency on external power generation can lead not only to inconvenience and expense for consumers, but also sabotage the economy.

After a record-hot summer tested the limits of supply in Ontario, the president of Canadian Manufacturers and Exporters Association warned that firms will simply move elsewhere if they can no longer be assured of a reliable and affordable supply of electricity.

One controversial component of the new B.C. Hydro plan was to have been an examination of the possibility of building a major dam at Site C on the Peace River near Fort St. John. Energy Minister Richard Neufeld says cabinet wants the public to have a better understanding of the looming electricity shortfall before the government starts discussing major new projects so it will understand what's at stake.

Fair enough, but more than 18 months have already passed since Hydro started talking about Site C and Neufeld has been energy minister for almost five years. How much time does he need?

The dams that produce our clean, cheap electricity now were built by leaders who could see not only what British Columbia was, but what it could be.

We need that kind of leadership again today, before the lights go out.

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Victoria finally notices Hydro's bumbling

By Brian Lewis
The Province
11-Dec-2005

Somewhere deep within the B.C. Legislature's stone walls last week a light bulb suddenly burst into brightness, thus illuminating a growing problem this province has with electricity and B.C. Hydro.

Word is that the "somewhere" was the premier's office, where it suddenly dawned on the backroom that its policy of letting Crown corporations like B.C. Hydro run their own show is flawed.

A policy of no political interference is laudable given what the NDP did with Fast Ferries, but the Liberals' response also holds risks, as we're now seeing with Hydro.

Here's the background: Since the mid-1980s B.C.'s abundant domestic electricity surplus steadily declined to the point where in 2000 we became deficient and now must import about 12 per cent of our electricity to meet domestic demand.

This means that one in eight houses on your block runs on higher-cost electricity imports. The last major domestic power generation project came on-stream in 1984.

The problem began under the NDP, who used Hydro as a cash cow, siphoning off mega-dollars for other flights of fancy instead of upgrading and expanding the B.C. electricity grid to keep pace with growing demand.

But the Liberals have failed too, by allowing the province's largest Crown corporation too much independence without offsetting accountability.

As the recent Premier's Progress Board report on B.C.'s energy future noted: "B.C. Hydro is seen to set its own policies on electricity supply or responding to matters of public interest, such as the Energy Plan, in its own time and manner . . ."

Consequently, Hydro's track record on increasing power supply has been dismal indeed. Witness the now-shelved Duke Point/Vancouver Island natural gas pipeline fiasco that cost ratepayers $120 million.

Late last week Hydro was supposed to release its much-touted Integrated Electricity Plan, a 20-year blueprint for bringing B.C. back into a surplus electricity position, which the utility had been working on for a year.

Less than 24 hours before this plan was to be unveiled with all the pomp and circumstance of a B.C. budget, it was unexpectedly killed by Victoria.

The official explanation was that a review of the government's existing Energy Plan is awaiting a number of reports so that all of them, including the IEP from Hydro, can be studied together.

The energy ministry also said it didn't have enough time to study Hydro's plan before its scheduled release last Thursday.

Believing the latter explanation is akin to believing in the Tooth Fairy, since energy ministry officials have been involved in the IEP all along.

The real reason for pulling the plug, I'm told, rests with the 20-year-plan's central plank -- the Site C hydro-electric project.

Simply put, if Victoria allowed Hydro to proceed with this Peace River project as outlined in its IEP, there's a high risk that it would become another Fast Ferries fiasco -- only one with much higher cost consequences for taxpayers.

The problem is that Hydro's cost-estimates for Site C are not only all over the map, they're incomplete, sources say.

Last May, the utility was touting Site C at a construction cost of $2.26 billion with electricity costs of about $48 per megawatt hour. Last week it was talking about a $3.5 billion capital cost with electricity costs of $43 per megawatt hour. A higher capital cost with a lower cost for the electricity?

Nor have many other costs including transmission-line upgrades to the Lower Mainland, inflation or First Nations treaty costs, been included in the costing, sources say.

Realistically, they add, electricity costs in the $60-$70 per megawatt hour range are more likely.

Add up all these deficiencies and no wonder the premier pulled the plug. Even with transparent costing, Site C is going to be a very tough sell politically.

In the meantime, as B.C. power planning stumbles and bumbles along, the need to import electricity increases and that means much higher electricity bills are in store for everyone.

Brian Lewis is Money Editor of The Province. He can be reached at blewis@png.canwest.com

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Hydro needed to have its plug pulled

By Les Leyne
Times Colonist (Victoria)
13-Dec-2005

Full marks to the provincial cabinet for embarrassing B.C. Hydro by putting a last-minute hold on the utility's grand release of its 20-year-plan.

They should have done it sooner.

The Liberal move has provoked some alarm about political interference in the highly technical field of electricity supply. But if there's one area where a dash of political meddling would go well right now, it's in the area of energy policy.

B.C. Hydro has a huge reservoir of technical expertise and a headquarters full of experts who know what they're talking about. There's no doubt the integrated electricity plan they've been working on for more than a year will be a comprehensive document.

But writing a good plan is one thing. Executing a plan is another. And that's where B.C. Hydro has been falling down lately, and that's why the politicians stepped in.

It would be very surprising if they actually interfered in the plan itself during the delay period imposed on the release, which could last six months.

What they're planning to meddle in is the communication plan leading up to the execution of the long-range vision.

And looking at Hydro's record of executing plans and building things over the last while, it's clear they badly need some help on that front.

There's no clear record of whether it was that or something else on the government's mind. But something prompted them last week to blow a very abrupt whistle on Hydro's long-awaited release of the plan.

At the last minute, Hydro CEO Bob Elton said that after "consultation with government," it was all postponed until spring.

"Further work" is needed to ensure the plan meets the needs of ratepayers, said a statement put out in his name.

Behind the scenes, it's been reported that the Liberal cabinet looked at the plan's recommendation to proceed with another big-league dam on the Peace River and decided that a lot more prep work has to be done before that socially complicated project can proceed.

That's essentially what the Progress Board report said the week previously. It urged that B.C. become self-sufficient in electricity -- a luxury lost about five years ago. And it recommended the government step up and start, well ... interfering.

"It is the role of the B.C. government to speak for the public in this regard, and it is the role of B.C. Hydro to follow the direction of government."

But the report said exactly the opposite is the norm: Hydro has the government out-gunned in any energy discussions, and sets its own policy "in its own time and manner."

Elton's statement last week after the rug was pulled out from under him tried to smooth everything over, saying both government and Hydro have a strong desire to ensure the plan is fully reviewed in the context of the government's energy policies.

You'd think that's exactly what they've been spending the last year doing, but apparently the master plan was a big surprise full of new revelations to the provincial cabinet. It's obvious there's a gulf now between the government and Hydro. It's not about whether to build that multi-billion dollar dam, though.

It's about how.

First Nations and other residents in the area have to be brought on side, much firmer cost estimates have to be established and the need for the power has to be explained to people before the bulldozers move in.

In the back of the politicians' minds is Hydro's track record when it comes to embarking on major projects. The problem is that they don't have one any more. The days of the utility's mega-projects are far behind us. Hydro has made incremental increases to its generating capacity, but it hasn't made a major addition to the energy supply since 1984.

And even when it comes to building smaller projects, like the Vancouver Island Generating Project, the utility got bogged down in a wild-goose chase up and down the Island that cost 10 years and $120 million before it fizzled out last summer with nothing to show for it.

If an outfit like that showed up at the door with a 20-year plan for the province's energy future, you'd want to think twice about it, too.

The danger in some minds is that -- now that the ice is broken -- the politicians will take to this new policy of intervening and start throwing their weight around on technical questions, as well.

That's the habit previous New Democrat governments fell into, and let's just say it doesn't work out.

Cabinet is expecting two more substantial reports on energy, one on alternative energy prospects and one from the competition council.

They need to digest those early next year, get a better idea from Hydro on how to pitch the Site C Peace project as doable, make some informed guesses and then get out of the way.

But there's no harm so far in jerking B.C. Hydro's chain.

leyne@island.net

Also of interest: Leyne's 24-Nov-2005 column, "Who's got the power with our power?" (link)

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Posted by Arthur Caldicott at 01:51 PM

December 10, 2005

United Nations Climate Change Conference
Montreal, November 28-December 9, 2005

Guy Dauncey of the BC Sustainable Energy Association (www.bcsea.org) has been at the conference, and his blogs from Montreal are a rewarding read. You can find them all at www.bcsea.org.

Here is his last blog and summary of proceedings:

Saturday, December 10th

Well, it is all over, and the story is: SUCCESS!

The last two days have been full of ups and downs, which I have tried to follow and interpret (and occasionally mis-interpret) through a mixture of conversations and following the latest media interpretations via Google News (a recent discovery: if you set up a personal Google News page http://news.google.ca/, you can personalize it to send you only the news stories that carry a particular phrase, such as ‘climate change’ or ‘flying giraffes’. Very handy).

The final deal, which was gaveled down by Stephane Dion at 6.17am this Saturday morning, is (1) that the Kyoto nations have agreed to start discussions to draft a new long-range plan to combat climate change, to start in 2012 when Kyoto expires; and (2) that the larger group of world nations, including the USA, China and India, which signed the 1992 Convention but which have not ratified Kyoto, will hold an open-ended dialogue to discuss ways to reduce greenhouse gas emissions, but with the specific inclusion of a clause that the Americans demanded insisting that the dialogue for these nations not include any talk about new commitments. The world’s delegates cheered when the deal was finally done.

The NGO community is jubilant, full of hugs and tears. The deal is done, and the world can get down to work to tackle the really big task: implementing the actions, as well as the words. In addition to those two agreements listed above, there were also successful conclusions to a lot of side-agreements regarding the detailed implementation of the existing Kyoto Protocol. The best news coverage I’ve seen so far is from Peter Gorrie, in the Toronto Star (link)

My Google News indicator says there are 1,533 related news stories, which tells you how busy the world’s media is with this issue. The Reuters story is also good. (link)

But there was also a second, really significant outcome from the talks. A new informal world standard has emerged for a 30% reduction in emissions by 2020, and an 80% reduction by 2050. The new C20 group of major world cities (including London) has signed onto this goal, as has the European Parliament. This was also the goal set by the youth delegation, which has received a LOT of attention. California has adopted the 80% by 2050 goal, and President Chirac has said that France and the other developed nations should strive for a 75% reduction by 2050.

Personally, given what I know of the science, I don’t think this is good enough: I believe we should aim for an 80% reduction by 2025, but for what’s politically achievable right now, that places me in cloud cuckoo land. I’ll still hold to that goal, while trumpeting the 30% by 2020 and 80% by 2050 goals as fantastic.

These are not legally binding goals, of course; but they set the tenor of the direction in which we should be heading. What’s great about them is that the small numbers, such as a 6% reduction, allow people to think that we can continue with business as usual, while just fiddling with a few details. An 80% reduction calls for a complete rethink of the way we use energy, travel, and live, and opens the door to a future designed entirely along the lines of green sustainability (unless it’s done with nuclear, which is still in play).

Friday was full of excitement, as it seemed as if everything might come off the rails, at some points. Six months ago, when we knew that COP-11 would happen in Montreal, Elizabeth May of the Sierra Club invited various high-level people to attend, with the hope and intention that it would involve the mainstream American media and others, and awaken the USA to what was happening. The Sierra Club’s strategy worked brilliantly, not only because there has been a very strong presence from US city mayors, California State, and other leaders, who have made it quite clear that they are behind Kyoto, and more (195 US cities have now signed onto the full Kyoto goals), but also because Elizabeth’s trump card came up good when Bill Clinton decided just 3 days ago that yes, he would attend.

This threw everyone into an excited tizzy, and when the big moment arrived, around 2pm on Friday, everyone went into the big plenary room, where all of the chairs had to be turned round, so that Clinton would not speak under the formal UNFCCC logo. Then we all had to leave the room while it was ‘swept’ (not for litter, but for aliens from Mars), and then we all trooped back in, and Clinton immediately received a big standing ovation, before he’d even opened his mouth.

In his speech, he showed his normal flair with numbers, examples, policies and practices (it is just impossible to imagine George W giving a similar kind of speech), and really emphasized the economic benefits of greenhouse gas reduction, saying that the opponents of Kyoto were ‘flat wrong’ when they said that it would kill jobs and destroy the economy, which is one the US government’s main excuses for not signing on. (see here for a full report).

When he said that ‘"We know from every passing year we get more and more objective data that if we had a serious, disciplined effort to apply on a large scale existing clean energy and energy conservation technologies that we could meet and surpass the Kyoto targets easily in a way that would strengthen, not weaken, our economies’, he received spontaneous cheers and full applause (in which I was a very vocal participant). This is really important, since if we can persuade people on the economic arguments, the remaining few ‘skeptic’ doubts on the science arguments suddenly don’t matter.

The US delegation was really miffed at Clinton showing up and stealing the show, and they subsequently walked out of the negotiations, threatening to veto the whole thing. All that they were being asked to do under the existing text for the 1992 Parties to COP was agree to a dialogue, but no, even that was too much. The NGO community held a contest, as to what better word might please them, such as a ‘thingy’. Someone suggested ‘lunch at the ranch’, but the US delegates weren’t up for lunch with anyone, unless it was on their terms.

However, their walk-out did not play well in the US media, and after having a call to the White House, they came back into the play, and finally agreed to participate in the dialogue as long as it did not discuss commitments. As one NGO leader put it, in the stand-off over the planet’s future, the US blinked first. They caved in to the almost unanimous global pressure from all the other countries, and as a result, we now have a twin-track process which allows us to chart our way into a safer, more sustainable world.

On a personal level, Thursday was a wild day for me, and very rewarding. I was invited to speak to the youth delegation, which got them very pumped, and then I did a 15’ web-cast for the UNFCCC about the BCSEA, and a ’12 Step Process to make BC 100% free of Fossil Fuels’. This went down really well, and I had a big crowd listening at the end.

This lead to a meeting with the South African Minister of the Environment (who is trying to fight off the pressure to go nuclear), and with David Walsh, the Environment Critic for the opposition Liberal Party in the Alberta Legislature (who is trying to get a voice of sanity into Alberta politics), a radio interview for a German station and a film interview for a future film on activism and climate change. I ended up in conversations from 3:30pm till 10pm that night; and enjoying every moment of it.

Friday was equally busy, as I shared in presenting a seminar on Green Heat with Bill Eggertson in the morning, which was poorly attended, but successful nonetheless. And there have been many other highlights, such as listening to the City of London’s presentation by their Deputy Mayor Nicky Gavron. But that’s going to have to wait till I do a final wrap-up blog, since now I’ve got to get my skates on, and get organized for my flight back to Victoria.

So over and out!
Guy

Read Guy's other blogs from Montreal at www.bcsea.org

Posted by Arthur Caldicott at 03:15 PM

UN talks set road map for Kyoto beyond 2012

By David Fogarty and Mary Milliken
Reuters
10-Dec-2005

MONTREAL (Reuters) - Environment ministers agreed on Saturday to a road map to extend the Kyoto Protocol climate pact beyond 2012, breaking two weeks of deadlock at UN talks aimed at curbing global warming.

Ministers also agreed to launch new, open-ended world talks on ways to fight climate change that will include Kyoto outsiders such as the United States and developing nations. Washington had long resisted taking part in the talks.

"This is a watershed in the fight against climate change," European Environment Commissioner Stavros Dimas told reporters of the accords after talks that dragged on till nearly dawn. The conference was attended by 10,000 delegates.

"There is still a harsh road in front of us," Dimas said about the long-term drive to cut emissions of carbon dioxide and other gases released by burning fossil fuels and blamed for heating the atmosphere and oceans.

Environment activists cheered, hugged and some even cried after the delegates passed what they hailed as historic decisions to brake catastrophic changes ranging from desertification to rising sea levels.

"There were many potential points at this meeting when the world could have given up due to the tactics of the Bush administration and others but it did not," said Jennifer Morgan, climate change expert at the WWF conservation group.

The United States, the world's largest emitter of greenhouse gases, pulled out of Kyoto in 2001, saying a fixation on emissions targets would harm economic growth, a view challenged on Friday in Montreal by former U.S. President Bill Clinton.

WATERED DOWN

Washington agreed to join the open-ended dialogue only after Canada and the European Union watered down the text and spelled out that it would not lead to formal negotiations or commitments or the type of emissions caps enshrined in Kyoto.

"The text that was adopted recognises the diversity of approaches," said U.S. climate negotiator Harlan Watson.

Washington favours voluntary measures and big investments in technology like hydrogen or carbon storage. Other countries are seeking to engage Washington for the long haul, hoping President George W. Bush's successor will be less sceptical of UN-led action on the environment.

The Montreal talks followed a twin track -- one pursuing negotiations to advance Kyoto and the other under the broader UN Framework Convention on Climate Convention, Kyoto's parent treaty ratified by Washington.

"We are delighted," said Margaret Beckett, environment secretary for Britain, head of the rotating European Union presidency.

Stephane Dion, Canada's environment minister and chair of the Montreal talks, was relieved. "Finally, we have achieved what many claimed was unattainable," he told delegates at the final session.

"Facing the worst ecological threat to humanity, you have said: the world is united, and together, step by step, we will win this fight," he said.

The Kyoto decision urges rich nations to decide, as early as possible, new commitments for the period starting in 2013 so that there is a seamless transition when the current phase ends in 2012. Beckett said that this would reassure traders in carbon dioxide markets.

Under Kyoto, about 40 industrialised nations have to cut their emissions by an average of 5.2 percent below 1990 levels by 2008-2012.

But developing countries, such as China and India, have no targets under Kyoto and say that rich industrial states -- having fuelled their economies with coal, oil and gas since the Industrial Revolution -- have to take the lead in cutting emissions.

The agreement on a Kyoto renewal road map gives members seven years to negotiate and ratify accords by the time the first phase ends in 2012. Most countries agree that deeper cuts will be needed to avoid climate chaos in coming decades.

Global warming is widely blamed on a build-up of gases from burning fossil fuels in power plants, cars and factories.

With the talks over, a huge sigh of relief swept through the vast conference hall after a 20-hour session that left delegates exhausted and a little emotional. Some environmentalists said the Montreal talks would have profound consequences for humanity.

"At 6.17 this morning, (Dion) brought down the gavel on a set of agreements that may well save the planet," said Elizabeth May of the Sierra Club of Canada.

© Reuters 2005. All Rights Reserved.

Posted by Arthur Caldicott at 03:10 PM

Conference reaches climate deal

U.S. agrees to watered-down declaration

PETER GORRIE
TORONTO STAR
Dec. 10, 2005. 08:25 AM


MONTREAL -- Weary delegates, politicians and lobby group members cheered early this morning as the United Nations climate change conference finally passed its last two major decisions after two days and nights of gruelling talks.
The main negotiating logjam broke around midnight, when the United States agreed to a watered-down declaration that all 189 countries at the conference will start an open-ended “dialogue” aimed at finding new ways to cut greenhouse gas emissions.

That move, in turn, allowed the passage of a crucial separate deal, under which Canada and 39 other industrialized nations bound by emissions-cut targets under the Kyoto Protocol will begin to negotiate deeper cuts for after the Protocol’s first phase expires in 2012.

The U.S. had objected to several increasingly weak versions of the dialogue agreement during the two week conference, and walked out of the talks Thursday night.

But under intense pressure from most other countries represented here, it finally relented, signing on to a final version after yet more revisions.

Environmental groups were enthusiastic about the conference’s outcome. “This is a set of agreements that may well save the planet,” said Elizabeth May, executive director of the Sierra Club of Canada.

They were equally pleased by the last-minute American compromise.

“The Bush administration blinked. The world should remember that,” said Bill Hare, policy director with Greenpeace International.

“They miscalculated and underestimated the will of countries to move forward in combatting climate change,”said Jennifer Morgan of WWF, formerly the World Wildlife Fund.

Environment Minister Stéphane Dion, the conference president, was obviously elated when he banged his gavel to signal the passage of the decisions.

The UN meeting has produced a “Montreal Action Plan” that “will guide us as we tackle climate change on many fronts.”

He denied the U.S. had caved in. Paula Dobriansky, the head of the American delegation, “acted in good faith,” he said. Despite disagreements: “she never told me she would not work with me.”

Under one agreement, the countries with mandatory emissions targets are to immediately start talks on deeper cuts. They are instructed to get the work finished in time so any new caps will take effect as soon as the first phase ends.

The dialogue deal calls for workshops to hold non-binding discussions, with no deadline.

Although vague, Dion said they would come up with innovative measures to combat climate change.

“Now, national governments will have the forum to exchange experiences and analyze strategic approaches, and to free our imaginations,” he said.

Posted by Arthur Caldicott at 03:03 PM

Clinton steals show at U.N. climate talks

Reuters
Sat Dec 10, 2005

MONTREAL (Reuters) - Former U.S. President Bill Clinton told U.N. climate talks in Canada on Friday that the Bush administration was "flat wrong" to reject the Kyoto accord and said cutting greenhouse gases was good for business and the planet.

In an impassioned speech to hundreds of delegates and nongovernmental groups, Clinton rejected a major tenet of the Bush administration's argument for pulling out of the Kyoto Protocol emissions pact in 2001.

Clinton, whose administration negotiated Kyoto in 1997 but never submitted it to a sceptical Senate for ratification, said the belief that Kyoto would hurt the economies of developed nations was "flat wrong."

"We know from every passing year we get more and more objective data that if we had a serious, disciplined effort to apply on a large scale existing clean energy and energy conservation technologies that we could meet and surpass the Kyoto targets easily in a way that would strengthen, not weaken, our economies," he said.

Under Kyoto, some 40 industrialised nations agreed to cut emissions in 2008-12 by over 5 percent from 1990 levels, but Bush says mandatory cuts on emissions from fossil fuels would hamper growth and job creation.

Clinton said a serious commitment to a clean energy future was the solution and this would lead to jobs growth, just like the tech boom of the 1990s fuelled an employment boom.

"We can create jobs out of wind energy, solar energy, out of biofuels, out of hybrid engines," he said.

Stricter efficiency standards for building and appliances would also boost jobs.

"In America, there's no telling how many jobs we could create if we just made the decision that in the rebuilding of New Orleans it would become America's first green city," he said.

Talks in Montreal are trying to take the Kyoto Protocol forward after its first phase ends in 2012 but the discussions have dragged in part because of U.S. objections to any binding commitments on emissions of carbon dioxide and other greenhouse gases.

Many delegations say efforts to curb global warming will be futile unless the United States, responsible for about a quarter of the world's greenhouse emissions, fully participates.

Clinton's speech drew applause and cheers from the audience.

"I don't know if it will have an impact (on the meeting), but I liked what he said. He's talking to the committed here," said Grant McVicar, a member of host Canada's delegation.

Many scientists say rising levels of carbon dioxide from burning fossil fuels will lead to rising seas, melting of glaciers and ice caps and more extreme weather events, including storms like Hurricane Katrina that devastated New Orleans.

© Reuters 2005. All Rights Reserved.

Posted by Arthur Caldicott at 03:00 PM

December 09, 2005

GSXCCC Annual General Meeting

6 November 2005

GSX Concerned Citizens Coalition
4th Annual General Meeting!

DATE: Saturday, 10 December 2005

TIME: 5:00 p.m. to whenever

PLACE: Pixie Hall, 3550 Watson Avenue, Cobble Hill
(across the road from Cobble Hill Farmer’s Institute Hall)

The GSX Concerned Citizens Coalition is holding its fourth AGM, potluck feast and social evening. We want all members and guests to join us, bringing food and drink, and an interest in Vancouver Island’s electricity future.

You are invited and encouraged to attend and:
• Celebrate the demise of the Duke Point Power Plant and the effective end of BC Hydro’s on-Island gas-fired electricity strategy;
• Help determine a New Direction for GSXCCC;
• Elect new directors (members only);
• Renew your membership (or join; assuming we go forward);
• Enjoy a great potluck feast with fun people.

Agenda & Order of Business:
(Non-members are welcome; only members will receive voting cards.)
5:00 – Meet, greet and renew memberships;
5:30 – AGM called to order;
• Financial Report by Phil Marchant, Treasurer (There is no auditor.);
• President’s report on GSX and Duke Point;
• Arthur Caldicott’s report on Vancouver Island Transmission Reinforcement Project and other GSXCCC activities;
• Nominate and elect directors;
• Resolution on next steps.
6:50 – Potluck Feast.

Support your hard-working directors or just come to eat.

Election of Directors:

GSXCCC has eleven directors and space on the Board for twelve. Elections are for two-year periods, staggered.

Incumbent & Position: Status: Going-Forward Position
Tom Hackney, President continuing as Director
Steve Miller, Vice-Pres. continuing as V-P
Arthur Caldicott, Secretary continuing as Secretary
candidate for President & Sec
Phil Marchant, Treasurer candidate for re-election
Don Skerik, Director continuing as Director
Kevin Maher, Director continuing as Director
Mairi McLennan, Director candidate for re-election
Dodie Miller, Director candidate for re-election
Peter Ronald, Director resigning
Tony Fisher, Director continuing as Director
John Hill, Director continuing as Director
? (this could be you!) vacancy Director

Five Directors are due to be elected or re-elected. Their terms are for two years. Directors may be nominated from the floor or may be put forward prior to the meeting (call Tom Hackney (250) 381-4463 or email thackney@island.net). Include evidence that the candidate accepts nomination. Candidates must be members in good standing.

Resolution on the Number of Directors:

The AGM may find it convenient to set the number of Directors at some number less than twelve. Five is the minimum allowable.

Resolved that: The number of Directors for the GSXCCC is ___.

New Direction for the GSXCCC:

Resolved that: The GSXCCC continue to intervene in regulatory proceedings and to take other actions as necessary to continue to promote sound energy policies and practices for Vancouver Island and BC.

Posted by Arthur Caldicott at 03:58 PM

Sea Breeze Files For First Power Line

Nickle's Energy Analects
8 December 2005

The National Energy Board (NEB) reports it has received an application for the construction of a 150-kilovolt, high-voltage, direct-current, international power line (IPL) connecting Vancouver Island and Washington.

The NEB said the proposal from a subsidiary of Sea Breeze Power Corp. would extend a transmission line for 47 kilometres from View Royal, British Columbia, near Victoria, southward across the Strait of Juan de Fuca to Port Angeles, Washington.

About 12 kilometres of the line would be onshore, with the remainder to extend underwater across the strait, the NEB said in noting the Sea Breeze subsidiary also proposes to construct a converter station near existing substations on Vancouver Island.

The proponent would like to start construction in November 2006, the NEB said in noting it would establish procedures for the public hearing process in early 2006.

The NEB said it anticipates conducting at least one public information session on its processes for the filing.

Sea Breeze has proposed two IPL -- the one connecting to Port Angeles from Victoria and another connecting Vancouver to Fairmount, Washington, which could be available for service as soon as 2008.

The interconnecting utilities for two IPL, which have been under development since October 2003, would be British Columbia Transmission Corporation (BCTC) in B.C. and Bonneville Power Administration (BPA) in Washington.

Sea Breeze made its first interconnection filings to the BCTC and BPA in June 2004.

The NEB authorizes IPL projects on behalf of the federal government.

The NEB application was filed by Sea Breeze Victoria Converter Corporation, which was established by Sea Breeze Pacific Juan de Fuca Cable, LP.

The partnership is owned equally by Vancouver-based Sea Breeze and Boundless Energy NW, Inc. of York Harbor, Maine.

NEB news release, 07-Dec-2005

Application submitted to NEB

Posted by Arthur Caldicott at 09:49 AM

Higher Global Output Forecast As Peak Oil Debate Continues

By Mike Byfield
Nickle's Daily Oil Bulletin
8 December 2005

The debate over global petroleum potential continues to bubble, with Cambridge Energy Research Associates, Inc. asserting yesterday that daily capacity will rise as high as 108 million bbls by 2015 from 87 million today. Several decades from now, CERA said, production will move into an "undulating plateau" rather than plunge drastically.

Robert Esser, CERA's director of global oil and gas resources, made that forecast to the U.S. Congress, addressing a hearing to examine peak oil theory which is being conducted by the Energy and Air Quality Subcommittee of the House of Representatives. Esser's forecast is based on a new field by field analysis of global reserves. [Esser's full testimony is here.]

Regarding Saudi Arabia's pivotal reserves, Ross Smith Energy Group has assessed Twilight in the Desert: The Coming Saudi Oil Shock and The World Economy, a best-seller by Houston banker Matthew Simmons. The Calgary consulting group concluded that Twilight incorrectly "posits a crisis where none exists" due to the author's misinterpretation of engineering studies.

Simmons, whose book is now being translated into Chinese, Japanese and Korean, is not backing off. Instead, he claimed that Saudi Aramco insiders have privately expressed relief to him in recent weeks that the worrisome possibility of a production collapse in that country has been publicly aired. [view Simmons' presentation of "Twilight in the Desert" to the Hudson Institute here.]

Like Ross Smith, CERA disagreed with Simmons. Esser testified, "While there has been much debate about Saudi Arabia's ability to expand production capacity, we see no comprehensive justification of claims that production is about to `fall off a cliff.' We anticipate an expansion of crude and condensate capacity from 11.1 million bbls per day in 2005 to as much as 13.2 million by 2015."

"We see no evidence to suggest a [global production] peak before 2020," Esser stated, "nor do we see a transparent and technically sound analysis from another source that justifies belief in an imminent peak."

For the period 1995-2003, CERA said world production was replaced by a ratio of 4:3 due to exploration plus upgrades of previous discoveries. That analysis was based on field figures compiled by its parent firm IHS Inc.

CERA pegged global production for that period at 236 billion bbls. On the supply side, exploration success reportedly added 144 billion bbls and field upgrades accounted for 175 billion bbls, for a total of 319 billion bbls.

Esser said that much confusion has been created by the U.S. Securities and Exchange Commission, whose reporting regulations still reflect technology current in 1970. For example, SEC regulations do not permit American producers to include Canadian oilsands properties in their reserve figures.

CERA acknowledged that non-traditional sources will continue their dramatic rise, constituting 35% of global production capacity in 2015 compared to 10% in 1990. Its report indicates that reliance on OPEC sources will increase only slightly by that time.

Included in the expanded supply figure is an increase of heavy oil capacity in Canada and Venezuela to 4.9 million bbls per day by 2015 from 1.8 million this year. NGL capacity is projected to reach 23 million bbls per day from 14 million.

Esser warned that the more serious threats to global supply come from above-ground factors such as warfare, political turmoil, and inadequate development of a skilled workforce and petroleum infrastructure.

In stark contrast to CERA's optimism, Simmons told the DOB that by 2020 global production is likely to be approximately 60 million bbls per day, creating massive strains in a world economy that is currently headed toward daily demand of 120 million bbls.

His firm, Simmons & Company International, has 126 employees in Houston and Aberdeen, billing itself as the largest investment bank dedicated to the oilfield service sector. The banker noted that improvements in oilfield productivity in recent decades have come entirely from service firms.

"Petroleum producers must be optimists by the nature of their business," Simmons commented. "They are masters of expounding the best possible case in the most conservative-sounding vocabulary. In their eyes, I'm just a banker and a rig guy who doesn't know what he's talking about."

Even so, Simmons said, he publicly predicted in 1995 that North Sea oil production would peak between 1998 and 2000. "At that time, a roll call of the world's best producers forecast that the North Sea would peak in 2010 at eight million bbls per day. In reality, the North Sea peaked at almost 6.1 million bbls in 1999."

The banker commented that North Sea output will dip to about 3.5 million bbls during next summer's workover period, and that the summer low has become the annual production average within a year or two in recent times.

In a similar vein, Simmons pointed to Oman's giant Yibal oilfield, which declined from a peak of 250,000 bbls per day in 1997 to less than 40,000 bbls currently. "The field watered out," he recalled. "Yet just months before the production collapse began, Shell's best technicians had made plans to increase Yibal's production by 30%."

The Houston entrepreneur said his critics wrongly state that his book predicts an imminent collapse of Saudi production. "Twilight explains why a Saudi drop could occur unexpectedly, we can't know exactly when but it might be soon, and the decline could be relatively rapid when it hits, like Oman and the North Sea."

Fundamentally, the author said, no one can rely on the Saudi Arabia's production forecasts until the kingdom releases data on a field by field basis, which its government has consistently refused to do.

Simmons is not yet a believer in oilsands, coal liquefaction and most other non-conventional resource plays. "With alternative sources, be careful that you don't put more energy in than you get out," he advised, postulating that Alberta oilsands operators should weigh the use of nuclear power to preserve natural gas.

The banker suggested that higher oil prices will force profound transportation changes. "Long-distance trucking will be drastically curtailed in favor of trains and ships." In his calculation, ocean freighters are 30 times more energy-efficient than trucks, while a single Mississippi tug can move barge-borne tonnage equal to about 350 semi-trailer truckloads.

The banker believes that rising transport costs will mean that most food will be grown much nearer to consumers, that far more goods will be manufactured locally and that a massive work shift will occur from central offices to computer-networked home offices in order to reduce commuting expense.

"Wages for home-based workers will be based on productivity more than time, and as a result we'll see a huge surge in productivity," the Texan financier prophesied.

Jim Jarrell, president of Ross Smith, said his firm's clients are investors who were alarmed by Simmons' intensively publicized forecasts. The Calgary consultancy's reservoir specialists reviewed Twilight's analysis of Saudi output, which was based on about 235 technical papers published by the Society of Petroleum Engineers (SPE).

Ross Smith contradicted Simmons' claim that Saudi Aramco's reporting data is exceptionally skimpy, commenting that the state oil company's "practice of assigning reserves appears to be as conservative as any we have seen among North American companies."

Jarrell said Twilight's interpretation of SPE engineering studies is professionally unorthodox, at times technically uninformed and inaccurate in terms of its conclusions.

For example, Ross Smith pointed to the best-seller's heavy reliance on a 1979 U.S. Senate subcommittee paper which predicted an irreversible decline in the giant Saudi Ghawar field due to water breakthrough and decreasing pressure. In reality, the Calgary consultant said, Ghawar's water cut peaked at 37% in 1999 and no such production decline has occurred.

While Twilight expressed concern that Saudi exploration has yielded few new oilfields for decades, the Ross Smith study countered that little Saudi wildcat drilling has occurred because the existing fields remain so ample and healthy.

http://www.nickles.com/brn.html

CERA's Robert Esser's full testimony to the Energy and Air Quality Subcommittee of the House of Representatives, is here.

Matthew Simmons' presentation of "Twilight in the Desert" to the Hudson Institute is here.

Posted by Arthur Caldicott at 09:36 AM

December 08, 2005

Government concern about Site C dam stalls power plan

By Scott Simpson
Vancouver Sun
08-Dec-2005


BC Hydro's ambitious 20-year plan for a multibillion-dollar makeover of British Columbia's electricity system hit a major snag Thursday when the provincial government ordered Hydro to back off out of concern about the controversial Site C dam project.

Hydro officials had little to say. Bob Elton, Hydro president and CEO, issued a brief statement by e-mail that the plan, which was to be unveiled today, would be delayed until an unspecified date next year.

Hydro's "Integrated Energy Plan" was expected to include a mix of small, private sector hydroelectric projects, electricity conservation initiatives, upgrades to large government-owned facilities -- and a decision to proceed with the controversial Site C dam on the Peace River near Fort St. John.

It was not immediately clear if the province's concerns were attributable to soft cost estimates for Site C -- which would cost taxpayers a minimum $3.5 billion -- or strong opposition from first nations in northeast B.C., or a conflict with independent power producers who were promised in 2002 that all new power projects in British Columbia would be developed by the private sector.

"In consultation with government, we have now decided to postpone this release and will be doing further work to ensure that this plan meets the needs of ratepayers," Elton said.

Earlier this week, some B.C. Liberal MLAs told Vancouver Sun political columnist Vaughn Palmer that they had concerns about Hydro's ability to shepherd the controversial Site C hydroelectric project -- the cornerstone of the new plan -- through to completion.

NDP energy critic Corky Evans said the province's 11th-hour involvement casts a shadow across more than a year's worth of community consultation and preparatory work by BC Hydro.

"What I find really bizarre is that it flies in the face of the Liberal mantra, maintained all through the public debate about the sale of Terasen Gas and the controversy about the [CN] railroad and all kinds of stuff, that it was not their intention to manipulate public processes or commissions or Crown corporations," Evans said.

Energy Minister Richard Neufeld was tied up in a series of meetings and could not be reached for comment.

Hydro goes through a similar planning exercise very two years, submitting details to the B.C. Utilities Commission as per its regulatory requirements.

However, this year's version of the plan was considered to be its most ambitious effort in more than a decade, in light of British Columbia's growing dependence on imported electricity to supplement a provincial resource that has not grown significantly in volume since the Revelstoke Dam was built in the early 1980s.

Earlier this month, Treaty 8 first nations in northeastern B.C. advised Hydro that they "adamantly" oppose Site C.

The construction of two earlier dams on the Peace, the W.A.C. Bennett and Peace Canyon dams, led to flooding of millions of acres of traditional hunting and fishing territory for the bands.

A BC Hydro summary of a meeting with the aboriginals reported that they "made it clear that they are adamantly against the development of Site C."

ssimpson@png.canwest.com

Posted by Arthur Caldicott at 01:52 PM

Power for the people

By Dan Potts
Joint Industry Electricity Steering Committee
Vancouver Sun
08-Dec-2005


British Columbia now consumes more electricity than it produces. Blessed for decades with a surplus of electricity, we must now rely on others beyond our borders for a growing portion of our electricity needs.

It is an uneasy situation.

Several jurisdictions in North America, such as California and recently Ontario, have experienced serious problems because of their reliance on volatile external power markets for their electric power. There is no reason for that to happen here in B.C.

We have many resource options to choose from to meet our future needs -- thermal plants fired by natural gas, wood waste, or coal; wind; run-of-the-river hydro; Site C large hydro, and others. The challenge will be in making the right choices and at what cost.

BC Hydro has actively promoted conservation through its Power Smart program for several years and will continue to do so. But even with this aggressive program, consumption is expected to grow, particularly in light of the improved performance of B.C.'s economy.

In 2005, B.C. imported 6,896 giga-watt hours (GWh) of electricity to meet domestic needs, 12 per cent of our consumption and enough to supply over 650,000 homes. Without new generation, by 2020 we will be short on in-province generation by 14,000 GWh and forced to import a full 25 per cent of our energy needs.

BC Hydro is projecting that the Burrard Thermal Generation facility will supply up to 6,000 GWh per year. However, Burrard Thermal is inefficient by current standards, and with the high cost of natural gas is no longer a source of reasonable cost energy for the BC Hydro system.

While the facility still has a role to play as an emergency back-up for the Hydro system, using Burrard to produce 6,000 GWh a year would increase BC Hydro's total energy costs by at least $300 million per year compared to the historic costs of buying that amount of power from import markets.

Bringing on new sources of supply can take years of planning, engineering, and construction. We need to get on with the job if we are to continue to maintain the valuable competitive and employment advantage of low cost, reliable electric power that British Columbians currently enjoy.

Keeping the cost of the new electricity as low as possible is critically important to B.C.'s future. Ultimately it will be the ratepayers -- BC Hydro customers -- who pay for the new facilities. If the choices we make today result in expensive electricity, consumers will be unhappy, industrial and commercial manufacturers will be less competitive and ultimately B.C.'s economy will be negatively affected, having an impact on everyone.

To meet current and future demand, BC Hydro needs to develop an aggressive plan to acquire new, low-cost electricity and to consider all possible options.

The huge shortfall we are facing will require a mix of resources, both large and small. Site C alone can potentially deliver 4,000 GWh, but even if we had approval now it could take up to 10 years to build.

Coal is B.C.'s most abundant energy source and new technology makes generating electricity from a large coal-fired generating plant environmentally sound, predictable and reasonably low-cost.

While run-of-the-river hydro and wind may have a valuable place in BC Hydro's portfolio, they are typically small and dependent on weather conditions.

We have no particular preference for any one generating technology; in fact new electricity supply should come from a balanced range of options. Our only concern is that the process to determine those new sources of electricity not be biased in favour of expensive, less reliable options.

Regardless of the approach, developing new electricity sources and the necessary transmission capacity to distribute it will involve debate and controversy.

While we all may have our favorite approach, it is clear that for BC Hydro to fulfil its commitment to serve the province, low-cost electricity resources must be developed, and soon. To be successful in this effort, BC Hydro will need support from every level of government and the community.

Dan Potts is executive director of the Joint Industry Electricity Steering Committee, which represents the major industrial users of purchased electric power in B.C.

Posted by Arthur Caldicott at 01:46 PM

BC Hydro issues F2006 Call for Power ... at last

BC Hydro issued the Fiscal 2006 (F2006) Open Call for Power (“CFT” or “Call”) on December 8, 2005.

BC Hydro is targeting to procure in this Call:

(a) 2500 GWh/year from Large Projects
(greater than 10 MW capacity)

approximately 2,500 GWh/year of firm electrical energy, of which approximately 900 GWh/year is available commencing on or before 1 November 2009, and approximately 1,600 GWh/year is available commencing on or before 1 November 2010, and associated non-firm electrical energy, from Projects, each having a Plant Capacity of 10 MW or more (“Large Projects”), built, owned and operated by independent power producers, and

(b) 200 GWh/year from a portfolio of Small Projects
(greater than 0.05 MW, less than 10 MW capacity)

(b) approximately 200 GWh/year (based on a portfolio of approximately 50 MW of aggregate Plant Capacity at a 50% capacity factor) of electrical energy from Projects, each having a Plant Capacity of greater than 0.05 MW, but less than 10 MW (“Small Projects”), to be available on or before 1 November 2010, built, owned and operated by independent power producers.

Full F2006 description here.

Key dates in the CFT schedule are as follows:

08-Dec-2005 -- Issuance of CFT
06-Jan-2006 -- Bidder registration deadline
20-Jan-2006 -- Bidders' workshops
07-Apr-2006 -- Tender submission deadline
11-Aug-2006 -- EPAs delivered to successful bidders
28-Aug-2006 -- Executed EPAs and performance security posted
TBD ------------ EPAs filed with BCUC

Full schedule here.

To monitor ongoing updates with the F2006 Call, visit this webpage:
www.bchydro.com/f2006call

Posted by Arthur Caldicott at 12:54 PM

December 04, 2005

A 'Great Pipeline Race' in Canada

By Doug Struck
Washington Post
04-Dec-2005

FORT SIMPSON, A wind prickly with ice bit at Jonas Antoine, the gray-haired native elder. The sting brought a broad grin to his face. "I feel like a wolf in this weather, ready to hunt," he said, leaning against the driving chill.

The cold thrill of sneaking toward a keen-eared moose or snaring a lynx calls him, but Antoine spends days in a stuffy gymnasium, debating with chiefs and elders the looming invader from the north: a huge pipeline from the Arctic that all agree would irrevocably change this land.

Soaring energy prices and profits have revived plans for two massive pipelines -- the biggest private construction projects in North America -- to bring natural gas hundreds of miles south from the frozen Arctic Ocean, through vast untouched forests and under wild rivers, to the United States.

The plans would flood isolated areas of Alaska and Canada with thousands of construction workers, pump billions of dollars into poor native economies, and bring the roar of heavy cranes and bulldozers to pristine areas where it is now quiet enough to hear the hoots of snowy owls and the rustle of pine boughs.

The projects are crucial to keep up with the growing thirst for energy in the United States, say oil company officials and energy analysts. Supporters and opponents agree that the projects would affect Canada's sparsely populated north on a scale larger than the Alaska oil pipeline in the 1970s, and unleash a rush of new exploration and drilling.

"Every square inch is going to be opened to diamonds, sapphires, gold, oil and gas," Michael Miltenberger, the Northwest Territories minister of natural resources, said in an interview in the territories' capital of Yellowknife. "There's an insatiable demand. And the critical first step is the pipeline."

There are daunting obstacles before any construction begins: The two pipeline projects are in competition for workers and capital -- only one can be built at a time. Native groups in Canada have not yet given access rights; environmentalists fret over caribou and the permafrost; and the pipeline companies face a mountain of regulatory red tape and promised lawsuits.

But the huge profits in the energy business, and the unquenchable demand for energy in the United States, have given the projects an impetus that may make one -- or both -- projects unstoppable.

"The time and events are right. It would be very hard to turn your back on this kind of supply," Miltenberger said.

Of the two lines, the Alaska Gas Pipeline is the behemoth. Its most likely route would stretch 1,700 miles from Alaska's Prudhoe Bay to Canada's Alberta province. The line would cost $20 billion and take a decade to build, but the project has picked up momentum under the whip of Alaska Gov. Frank H. Murkowski (R) and $18 billion in loan guarantees approved last year by Congress.

The second line, the Mackenzie Valley Pipeline, would start 250 miles east of the Alaska line, on Canada's portion of the Beaufort Sea. It would snake 800 miles through forests of spruce and pine along the Mackenzie River -- one of the world's longest with no bridge or dam. This all-Canada route would cost $6 billion and is predicted to take three years to complete once construction begins.

Both projects have been pipe dreams for three decades. Drillers who flocked to the cold deserts of Alaska's North Slope after oil was discovered in 1968 also found vast deposits of natural gas. But there has been no way to move the gas to markets; it cannot flow in the oil pipeline. Oil producers proposed both the Alaska and Mackenzie gas pipelines in the 1970s, but the plans died under the weight of rising construction costs, dropping natural gas prices and -- in Canada -- opposition from native groups.

That has changed. Natural gas prices are now at all-time highs, greatly enhancing the lure of profits. Every energy forecast shows a yawning gap between supply and the rising demand. More natives of the north now see economic opportunity in the pipelines, and their necessity is reluctantly being conceded by even environmental groups.

"The economics are right. Everyone needs this supply to come on line," said John Duncan, a member of the Canadian Parliament and the Conservative Party's expert on natural resources. "The real question is which is going to be built first."

Industry analysts say the projects would require so much capital, steel and skilled labor that it would be impractical to build both at the same time. The projects have been jostling for position, sparking what former Alberta energy minister Murray Smith has called "the great pipeline race." Oil company officials would prefer the shorter Mackenzie line to go through first, but delays have jeopardized that possibility.

Four reserves of Indians -- known as First Nations here -- are involved in negotiations to permit the Mackenzie line to cross their land. The four oil companies behind the project have agreed to give First Nations a one-third share of the line, and the federal government in July offered $425 million for native social programs as an incentive. But the bands are split over the proposal.

Antoine, 64, is a member of the Deh Cho, a band of about 4,000 members on land centered at Fort Simpson, a quiet town on an island accessible by ferry in the summer and by a road carved on the river ice in the winter.

He grew up hunting caribou and moose, snaring rabbits and cutting holes in the ice to fish in the winter. He remembers a hard life, remembers being hungry when the game disappeared. But he is wary of the coming pipeline, and the change it will bring.

"You can still have freedom to roam here. You can travel for 100 miles without running into any other tracks, camping wherever you want, drinking out of any stream," he said of the Deh Cho lands.

Herb Norwegian, the blunt chief of the Deh Cho, said his people see no reason why they should not get what they want from oil companies making huge profits. He has asked for fees, royalties and jobs, but his fundamental demand is of the government, which has yet to settle Deh Cho land claims.

"If the pipeline is going to pass through our land, the government has to treat us like the landlords," Norwegian said.

Not all agree with him. Harry Deneron, 63, a member of the Deh Cho group of chiefs, said change already has come, and the First Nations people should benefit.

"Our people will be the first to complain if their hot-water heater goes up," he said with a laugh. "We should accept the pipeline, with conditions. We have to compromise. This has gone on too long."

Either project would march a small army of construction workers into the north for several years. They would carve roads, haul steel, dig a trench through the permafrost and bury the pipeline before departing. The Alaska Pipeline project alone would be more than double the size of the 800-mile-long trans-Alaska oil pipeline finished in 1977, which took 21,000 construction workers three years to build.

Towns along the pipeline routes grimly expect the construction to bring inflation, drugs and crime along with the economic boost for their rural economies. In Yellowknife, two new diamond mines have sent rents soaring and brought cocaine to the streets. Last month, the town experienced its first drive-by shooting.

"We know things are not going to work perfectly. They never do," said Bill Braden, a member of the territorial assembly in Yellowknife. "But the pipeline would give the communities and people of the Mackenzie Valley and Delta hope for the future. Right now, if I was a teenager, I wouldn't see a whole lot of reason to stay in the area."

The bigger footprint, after the construction crews have left, will be in opening the mineral-rich area to further exploration and development.

Mostly for that reason, some environmentalists favor the Alaska Pipeline, which follows the route of the existing oil pipeline and Alaska Highway.

"We think it's the lesser environmental evil," said Stephen Hazell, a director of the Sierra Club of Canada. Environmental groups have largely bowed to the inevitability of at least one of the projects.

"Natural gas is clearly better than coal or oil," said Peter Ewins, a director of the World Wildlife Fund of Canada. "In principle, we are not opposed, if the development is done in a properly planned and well-balanced way."

The natural gas from either line would be fed into a grid of pipelines in Alberta that connects the United States and Canada into a largely seamless single market. Oil company officials say the soaring demand is in the United States, and that is where the gas would go.

But some environmentalists suspect that the Mackenzie pipeline, in particular, would feed the huge oil-sands project in Alberta. There, natural gas is used to cook strip-mined tar sludge into recoverable oil, a process environmentalists say is energy-inefficient and increases global warming.

"If we were convinced the gas was going to be used in people's homes to replace coal-fired energy, we would be much more sanguine about it," said Hazell.

Despite its much larger size, the Alaska Gas Pipeline could move more quickly. The oil pipeline and highway along the proposed route already have cleared the way with access rights, aboriginal land claims and environmental reviews. Since the 1970s, the TransCanada pipeline company has held rights to one route in Canada, and has laid groundwork on the Alaskan side as well.

"The gas market in North America really quite desperately needs this gas," TransCanada Chief Executive Hal Kvisle, said by phone from Calgary. "We think it would be quite foolish not to use" the company's access rights to speed up the project.

Speed is what Alaska's Gov. Murkowski wants. He has made it a personal goal to find a way to get Alaska natural gas to market, foreseeing a second wave of the riches that poured into the state with the oil pipeline. All Alaskans still receive a yearly dividend check from the oil pipeline royalties.

"We are approaching an historic moment -- moving from 30 years of trying, to the reality of a gas line," the governor told reporters recently. He has proposed a novel sharing of ownership in which Alaska would have a 20 percent stake in the line.

"We're going to do it right this time," the governor said by phone from Anchorage after emerging from negotiations with the Prudhoe Bay producers Exxon-Mobil and BP. He already agreed to terms in October with a third company, ConocoPhillips. "The country needs the gas," he said. "This is the time."

Posted by Arthur Caldicott at 11:57 PM

B.C. will need more electricity

Editorial
Times Colonist (Victoria)
04-Dec-2005

Over the past five years, B.C. has gone from being an exporter of electricity to being a net importer. Unless we build one or more new power plants in the near future, the province will face a major shortfall of electricity in the decade ahead.

These are some of the conclusions from a critique of provincial energy policy, tabled recently by the B.C. Progress Board. The board was appointed by Premier Gordon Campbell to look for ways of accelerating economic growth: Its members are drawn from business and the academic community.

The reasons for this emerging crisis are simple enough: The last major addition to our generating capacity came in 1984. Since then our population has climbed 40 per cent, and projections suggest this growth rate will continue. Over the next decade, B.C. is expected to add the equivalent of a city the size of Kamloops every year.

As the report points out, B.C. has been coasting on cheap hydro-electric power from dams built on the Peace and Columbia rivers in the 1960s and '70s. That has created an illusion of security that makes the public and politicians unwilling to confront the need for action.

Moreover it's unlikely the deficiency can be made up by purchasing cheap surplus electricity from neighbouring jurisdictions, as B.C. Hydro has been doing in recent years.

At the same time our energy needs are increasing, world-wide demand is forecast to surge, due in part to the rapid pace of industrialization in China and India. We will be forced, therefore, to pay a much higher premium for imported power in coming years, or to live with brown-outs, or quite possibly to suffer both.

The authors warn that Ontario and California followed a similar path. Political leaders left public utilities to make the argument for additional power capacity, and in both cases, energy producers failed to convince a skeptical public.

In California, the effective outcome was a 20-year moratorium on new plant construction, which coincides with B.C.'s record almost exactly. Both jurisdictions went on to experience repeated brownouts, extending in California to rolling blackouts and a political firestorm that eventually saw the state governor dismissed in a recall vote.

What distinguishes this critique from similar reports is its willingness to confront the elephant in the room -- B.C. Hydro. The authors allege, in respectful but clear language, that government has lost control of the utility.

"B.C. Hydro is seen by many concerned parties to heavily outweigh the ministry (of Energy, Mines and Petroleum Resources) in staff and resources.... As a consequence, B.C. Hydro is seen as setting its own policies ... or responding to matters of public interest, such as the government's Energy Plan, in its own time and manner."

A case in point was the recent decision to abandon work on the new Duke Point power plant in Nanaimo, after the B.C. Court of Appeal granted opponents the right to a hearing. The Crown corporation walked away from $120 million already spent on the project, leaving the community and business partners in the lurch.

Not only did the decision catch ministers off guard, the fall-back strategy -- an upgrade of existing power lines from the mainland -- contradicted the corporation's earlier statements about the urgent need for new generating capacity on Vancouver Island. Of course that only added to the general atmosphere of complacency about electricity supply.

What's at stake is more than a political tussle over who controls energy policy, cabinet or the board of B.C. Hydro. The report makes a convincing case that unless government and the corporation speak with one voice, and do so consistently, there's little chance new installations will proceed.

In fact the challenge is quite daunting. Many of the environmental impacts that accompanied power-plant construction in bygone years would never be tolerated today. When the Peace and Columbia dams were built, aboriginal communities were flooded without prior consultation or compensation. Opposition to new gas-fired generating stations in the Lower Mainland is intense.

A prolonged spate of brownouts would no doubt soften public resistance. But given the extensive lead-time required to bring new capacity on line, well before we get to that point the damage will be done.

Convincing voters a crisis exists before its effects have been felt is never easy. While the Progress Board suggests a number of ways to bridge the gap, such as more energy-efficient building standards and price policies that reward conservation, the bottom line is clear.

Our province can, and should, be self-sufficient in electricity. But unless the cabinet takes B.C. Hydro in hand, and both present a convincing case to consumers, the government's promise of a "golden decade" ahead may fall by the wayside.

Posted by Arthur Caldicott at 12:03 AM

December 01, 2005

BC Hydro reports huge surge in profits

By Derrick Penner
Vancouver Sun
01-Dec-2005

BC Hydro recorded net income of $189 million in its second quarter, compared with $11 million for the same period a year ago, a huge profit jump driven by increased customer demand and electricity trading activity, the company said Wednesday.

Alister Cowan, BC Hydro's chief financial officer, said higher customer loads and trading, coupled with lower financing and amortization costs, were offset by lower revenue while the Crown corporation awaits approval by the B.C. Utilities Commission of a 7.23-per-cent rate increase.

BC Hydro added 24,808 new residential customers and saw an increase in commercial and industrial sales to post $1.26 billion in domestic revenue for the company's six months ending Sept. 30, and saw $765 million in net electricity trading revenue, $468 million more than a year ago.

Company spokesman David Conway said BC Hydro's board of directors is expected to decide by next week whether the controversial Site C Dam will be included as a preferred energy option in its integrated electricity plan.

The Crown corporation conducted a series of public consultations throughout the province earlier this year on the integrated electricity plan, which outlines how BC Hydro plans to meet the province's electricity needs over the next 20 years.

depenner@png.canwest.com

Posted by Arthur Caldicott at 09:22 PM

Oil Free Coast

Just say no to offshore drilling in B.C.
Rick Stiebel, Goldstream News Gazette, 30-Nov-2005
Oil Free Coast Alliance to government: heed public opinion
Matthew Gauk, Martlet (University of Victoria), 01-Dec-2005




Just say no to offshore drilling in B.C.

By Rick Stiebel
Goldstream News Gazette
Nov 30 2005


Rick Stiebel/News Gazette
WCWC Victoria campaign director Ken Wu, right, hands a pamphlet to volunteer/supporter Cindy Robinson during a rally at Esquimalt-Juan de Fuca MP Keith Martin's constituency office Wednesday.

That's the position the Western Canada Wilderness Committee reinforced during a rally at Esquimalt-Juan de Fuca MP Dr. Keith Martin's office last week.

"We're not protesting the federal Liberals because they haven't done anything to show us they are lifting the moratorium (on drilling for gas and oil off the coast of B.C.)," said WCWC Victoria campaign director Ken Wu. "But we're encouraging them to publicly comment on keeping it in place before the next election."

Wu cited the potential for oil spills, substantial greenhouse gas emissions and impact on marine life from seismic testing blasts as major concerns.

Wu also pointed out that offshore drilling in Newfoundland is conducted 300 kilometres off the coast, but it could be as close as 20 kilometres from shore if it goes ahead near the sensitive coastlines of the Queen Charlotte Islands.

"It's the one-year anniversary of public input into the process," Wu said. "Seventy-five per cent of people want the moratorium maintained. Now the government needs to move on maintaining it."

Martin, who was in Ottawa when the rally took place at his Langford office, said he's glad the WCWC came out, and that he's discussed the situation with the organization in the past.

"It's up to scientists to assess the potential for damage to the environment," Martin said in an interview with the News Gazette. "The question is can it be done in an environmentally safe manner. If that's the case, we have a responsibility to the people of B.C. to do it in an environmentally safe way."

Martin believes the oil and gas resources need to be utilized, providing scientists give it the green light because of the jobs the work will create and the benefits to the economy.

Long-time WCWC supporter and volunteer Cindy Robinson said it's important to keep the moratorium in place to protect marine life.

"It's already under stress from human activities," said Robinson. "We shouldn't go down a path that creates destruction through oil spills and seismic activity from blasting."

Federal NDP candidates Randall Garrison,(Esquimalt-Juan de Fuca), Jennifer Burgis, (Saanich-Gulf Islands) and Denise Savoie (Victoria) issued a news release the day of the rally demanding the government keep the moratorium in place.

rstiebel@vinewsgroup.com

TOP



Oil Free Coast Alliance to government: heed public opinion

by Matthew Gauk
Martlet (University of Victoria)
01-Dec-2005


Aaron McMillan photo:
Protesters opposed to offshore drilling display their disapproval Nov. 22 in front of UVicís McPherson library. The event was organized by the Western Canada Wilderness Committee.

Dozens of UVic students spelled out “Oil Free Coast” in front of the McPherson Library Nov. 22 to protest the possibility of offshore oil drilling in B.C.

The media event was a run-up to the National Day of Action on Nov. 23, organized by the Oil Free Coast Alliance. The Alliance, which includes the Western Canadian Wilderness Committee (WCWC) and the David Suzuki Foundation, aims to increase public awareness of potential oil and gas development off the coast of British Columbia.

A federal government moratorium on offshore drilling was put in place in 1971 by Pierre Trudeau at the behest of David Anderson, then Esquimalt-Saanich MP. The moratorium still stands, but some environmental groups are becoming concerned that the federal government, under pressure from the B.C. government, might start taking steps toward oil and gas exploration. “I think the federal government is just sitting on the fence,” said WCWC Victoria campaign director Ken Wu. “We would like some stronger statements that they will maintain the moratorium or, better yet, just have a legislative ban against offshore oil and gas development.”

The National Day of Action came a year after the release of the “Priddle Report,” a public input process instigated by the federal government to gauge public opinion on offshore drilling. The report found that three-quarters of British Columbians surveyed were opposed to oil and gas development.

“We’ve given them a year to consider the results of the public input process, so now we want them to commit,” said Wu. “We think they should be obligated to adhere to the results of their own public input process.”

The biggest concern among those opposed to offshore oil and gas development is the potential environmental impact. Exploration alone, which often involves seismic testing, can cause harm to whales, fish and crabs, according to some studies.

“It basically deafens whales,” said Wu. “It can kill the beaked whales; it can drive whales away from their feeding and migration areas, including Orcas and Gray Whales.”

The drilling would also threaten the seabird colonies and sea-sponge reefs that make the Queen Charlotte Basin a global treasure, says Jay Ritchlin, the marine campaign strategist for the David Suzuki Foundation.

He fears that small daily leakages and spills of drilling fluids would all go out into the ocean and have an immediate impact within a kilometre of the drill.

While large numbers of animals might not be wiped out from daily leakage, Ritchlin says, it could have a negative influence on developing salmon eggs, and the reproduction of herring, otters, and seabirds.

“It’s a really chronic issue that you don’t see,” said Ritchlin. “More and more we’re finding out that the residues from the oil itself have long-term impacts at lower levels.”

Wu and Ritchlin agree that the hypothetical fallout wouldn’t be limited to the environment. While both acknowledge that an offshore oil and gas industry would bring some economic benefit to the province, they point out that there would be pitfalls as well.

“Fishing still employs 16,000 people on the coast, and fish catches are reduced as a result of the destruction of marine larvae,” said Wu. “Fish are driven away from huge areas of their feeding and migration routes. This has been shown around the world.” Wu also cites possible damage to the $500 million a year worldwide whale-watching industry.

In the 2003 Throne Speech, the provincial government stated that they wanted to have an offshore oil and gas industry up and running by 2010. Since then, the province has created an Offshore Oil and Gas Team to foster the industry. One of their biggest selling points is the creation of jobs to service this industry. “My opinion is that B.C. takes all the risk, and probably most of the economic activity will accrue to large international firms who are already in the global oil market,” said Ritchlin.

The National Day of Action saw rallies at 24 locations in 19 Canadian cities. Volunteers leafleted and petitioned passers-by.

“There’s a federal election coming up,” said Wu. “So of all times where [politicians] need to get in line with public opinion, it’s now.”

TOP

Posted by Arthur Caldicott at 08:51 PM