Checked: Is BC Really Running Out of Electricity?

It was 7:30 p.m. at the end of a very long council meeting when Vancouver Coun. Brian Montague introduced an amendment to reverse a bylaw that barred newly built homes from using natural gas for heating (gas was never banned for stoves and fireplaces).

The move away from natural gas was part of the city’s climate action plan, meant to reduce greenhouse gas emissions. It’s also in line with changes to the provincial building code.

But Montague said climate change impacts like drought are causing BC Hydro to struggle to produce enough electricity. Allowing natural gas would help with “energy resiliency,” he said.

“I asked a lot of questions about the ability of BC Hydro to generate enough electricity,” Montague said.

As wildfires burned across B.C. and Alberta, Vancouver’s council voted 6-5 on July 23 to reverse the natural gas ban.

The city’s director of sustainability warned the decision was a move backward on the city’s climate plan, one that “would set us back thousands, potentially tens of thousands of tonnes of GHGs.”

Conservative Party of BC Leader John Rustad has made similar arguments. B.C. has mandated that LNG plants, which use huge amounts of energy to liquefy gas, use electricity.

Rustad says BC Hydro won’t be able to supply the plants, leading to cancelled LNG projects. He’s also said that increasing natural gas production will “bring back energy self-sufficiency” to the province and pointed to the perils of importing electricity.

So is B.C. — blessed with green hydroelectric energy — running out of power? And is that justification for expanding fossil fuel production?

Let’s take a closer look.

THE CLAIM: BC Hydro is struggling to generate enough power and is increasingly importing energy, some generated using fossil fuels.

FACT CHECK: Ninety per cent of B.C.’s electricity is normally generated by hydro projects. But in its 2023 third- and fourth-quarter reports, the Crown corporation warned that drought and low snowpack levels had lowered water levels in several key waterways used to power hydroelectric plants.

In response to Montague’s comments, Coun. Pete Fry said B.C. usually exports “double the amount of electricity we import because we’re part of an electricity grid that goes all the way down to California and all the way over to Alberta.”

It’s true that B.C. is normally a net exporter of electricity.

But the drought conditions have led BC Hydro to increase the amount of energy it imports from other jurisdictions, rather than being an exporter.

“We’ve had significant imports of electricity because of drought conditions, but there is purpose in this,” Werner Antweiler, an economist with the University of British Columbia’s Sauder School of Business, told The Tyee.

“B.C. buys electricity cheaply in the spring, stores power in its hydro dams and sells it profitably in the winter. This seasonal arbitrage contributes to keeping electricity prices low in B.C.”

Speaking to council, Montague said climate issues like flooding, winter storms or other natural disasters could lead to the power grid failing.

“We continue to focus on a single energy source,” he said. “And how do you ensure access to power when those things are happening?”

Antweiler said the idea that B.C. could run out of electricity is a “red herring” and pointed out that the natural gas distribution system is also vulnerable to natural disasters.

BC Hydro’s new hydroelectric dam, Site C, is scheduled to be operational by 2025 and supply 5,000 gigawatts per year, and the Crown corporation has also issued a new call for clean power projects to provide an extra 3,000 gigawatts.

But analysts have warned that power from hydroelectric dams, hydrogen fuel cells (which require water) and nuclear plants (which also require water for cooling) will be more vulnerable to climate change impacts in the future, as droughts become more common and prolonged.

If we turn to fossil fuels, GHG emissions will increase, leading to worse outcomes for climate change.

At the same time, the move to switch to electric cars and change home heating to electric systems will increase electricity usage. Despite those shifts, Antweiler said, electricity usage hasn’t spiked in recent years but has been “mostly a gradual increase along population growth.”

Antweiler believes the problem can be solved with the development of more clean energy projects like wind and solar, while David Hughes, an earth scientist who explored the problem in a February report for the Canadian Centre for Policy Alternatives, says a program of aggressive energy conservation is needed.

THE CLAIM: Allowing natural gas in new builds will save homebuyers money.

FACT CHECK: Montague tied the policy reversal to B.C.’s high home prices, saying homebuyers should be able to choose the option that’s cheapest.

Antweiler said natural gas is not necessarily less expensive than electricity.

“Using natural gas for water and home heating is not necessarily the cheaper option because there is a trade-off between upfront installation costs and long-term operational costs. The objective is not simply to produce ‘cheap homes,’ but also to keep operational expenses low for homeowners,” he told The Tyee.

“Heat pumps [a more energy-efficient form of heating and cooling] have higher upfront costs but tend to amortize quickly. A key reason why governments have stepped in regulating heating systems is because of what economists call a ‘principal-agent’ problem. A builder wants to produce homes cheaply and doesn’t care about the long-term costs. This is a market failure that requires governments to step in and regulate, as otherwise homebuyers end up with a heating system with higher life-cycle costs than they want.”

THE CLAIM: B.C. doesn’t have enough electricity to power new LNG plants.

FACT CHECK: B.C. is requiring all proposed liquefied natural gas facilities that are already in the environmental assessment process or entering it to pass an emissions test “with a credible plan to be net zero by 2030.”

LNG produces greenhouse gas emissions at every step of the extraction and liquefaction process. In B.C., the industry is being set up to export the fossil fuel outside of Canada, with the justification that LNG can provide a cleaner alternative to coal-powered energy plants in other countries.

Speaking to the Greater Vancouver Board of Trade on June 20, the BC Conservatives’ Rustad said that if his party forms government, he’ll repeal the net-zero requirement because BC Hydro can’t provide enough power for all proposed LNG projects to go ahead.

“We're going to remove that requirement for electricity for compression and we will make sure that we work with First Nations and designated sites so that we can see one, two, three, four, maybe five LNG projects,” Rustad said.

LNG plants do take an enormous amount of energy, Antweiler said. The proposed Cedar LNG project would use 1,160 gigawatts per year, just over a quarter of the 5,000 gigawatts hours of electricity per year the new Site C dam will produce when it’s up and running. There are already questions about whether the one LNG plant that has been developed so far will push B.C. off its emissions goals.

Because of the move towards electric vehicles and heat pumps, Rustad said, B.C.’s energy mix will need to include natural gas. (He added that people in the province likely wouldn’t support using coal for power.)

Antweiler said there are other examples of LNG plants using electricity and B.C. will probably have to limit industry that uses giant amounts of power.

“To say that B.C. will ‘run out of electricity’ is of course entirely contingent on what we allow to be connected to the grid,” Antweiler said. “If we allow bitcoin miners to run rampant, they will surely exhaust our available resources.”

The idea that LNG will suck up all of B.C.’s electric power only makes sense with the assumption of an “unfettered” expansion of LNG, Antweiler said. He believes there are renewable options other than hydroelectricity for powering LNG plants.

“The economics are increasingly tilting towards electrification,” Antweiler said. “It reduces carbon emissions even when gas turbines are used to generate electricity rather than hydro power, because the entire electric system is more efficient. But where electricity can be produced cheaply from renewable energy, that improves the economic and environmental benefits from electrification even more.”