Putting the over-budget Site C dam project on hold is the worst of the three options in front of British Columbia’s cabinet, according to a BC Utilities Commission report released today.
“The Panel finds the least attractive of the three scenarios is to suspend and restart the project in 2024,” said the 20-page executive summary of the BCUC’s final report to the government on Site C.
“The suspension and restart scenario adds at least an estimated $3.6 billion to final costs and is by far the most expensive of the three scenarios. In addition, the Panel considers it the most risky scenario because, among other things, environmental permits will expire and that will require new applications and approvals.”
Energy, Mines and Petroleum Resources Minister Michelle Mungall said cabinet will decide by Dec. 31 whether to stop the project or allow it to continue after further consultation with First Nations.
“This is a very technical report,” Mungall told reporters. “We haven’t had the opportunity to dive into all the technical details.”
She acknowledged that more than 2,000 people working on the site and those living near it are affected by the uncertainty about the project’s future.
But the situation was created by the former BC Liberal government, she said, which failed to do due diligence or allow an independent review before starting the project.
“We appreciate this is tough on everyone,” Mungall said. “This is a very serious decision and we are taking it seriously.” She said she doesn’t want to prejudge the outcome, but also talked about the need to make sure life is more affordable for British Columbians.
During Question Period in the legislature, Peace River South MLA Mike Bernier said he wanted the government to make the decision within four weeks.
Bernier later told reporters there were eight years of reviews before the previous government decided to build the Site C dam, which would provide clean energy for 100 years. Consultations were completed and contracts signed, he said.
“Obviously the decision in front of this government is do they take $4 billion, write it off, go against what’s happening up in the area right now, or do we continue on with the project,” Bernier said. “Our position is we carry on with this important project.”
Approved in 2014, Site C is the third of a series of dams on the Peace River and will flood an 83-kilometre-long stretch of the river to generate 1,100 megawatt hours of electricity, enough to power 450,000 homes for a year.
Construction on the controversial project began in 2015 and former premier Christy Clark had said she hoped to move it beyond the point of no return before this year’s election. In opposition the NDP complained that BC Hydro was overestimating future power needs and that electricity from Site C would not be needed as soon as the government claimed.
The 299-page British Columbia Utilities Commission Inquiry Respecting Site C Final Report to the Government of British Columbia found the project is already over budget by at least $1.6 billion and is likely behind schedule.
“The BCUC is not persuaded that the Site C project will remain on schedule for a November 2024 in-service date,” the summary said. “The Panel also finds that the project is not within the proposed budget of $8.335 billion. Currently, completion costs may be in excess of $10 billion.”
Terminating the project and remediating the site would cost about $1.8 billion, not including the cost of replacing the power Site C would generate.
It also found BC Hydro’s forecast for future electricity needs was “excessively optimistic” and that wind, geothermal and other sources are becoming increasingly viable and could provide similar benefits to Site C at a lower cost.
Green Party leader Andrew Weaver released a statement calling for the project to be cancelled. “It is unconscionable that the BC Liberals demonstrated such reckless disregard for British Columbians and for sound fiscal management by pushing through such a substantial megaproject without proper due diligence and oversight,” he said.
“I have long argued that the plummeting cost of alternative renewables makes Site C the unequivocal wrong direction for B.C.’s energy future... Supporting the development of smaller renewable projects presents a significant economic opportunity for all corners of British Columbia.”
Speaking at the legislature, Weaver said the government should cancel the project, even if it means adding $4 billion in debt to the province’s books. “The decision in my view is clear,” he said. “This [report] provides the evidence that is needed to say the Liberals were fiscally reckless to put this project forward.”