I have been incredibly busy at work over the last few weeks and so was not able to get involved in the public consultation portion of the BCUC Site C Inquiry process. Such are the downsides of not being a paid activist; when my work calls, my activism (which is a hobby for which I receive no compensation) suffers. Happily my work deadlines have passed leaving me time to read the BCUC Site C Inquiry Final report (the Report). What I read left me completely flabbergasted. The conclusions of the Report depend entirely on its load forecasts and the load forecast upon which all the major assessments are based completely ignores the overriding environmental issue of our age: fighting climate change. What also astounds me is that this incredibly important fact has not been highlighted in any of the analyses of the Report that I have read to date.
Since it is such an important point let’s evaluate it immediately. In the conclusion of the Report (on page 187) the Summary states:
We take no position on which of the termination or completion scenarios has the greatest cost to ratepayers. The Illustrative Alternative Portfolio we have analyzed, in the low-load forecast case, has a similar cost to ratepayers as Site C. If Site C finishes further over budget, it will tend to be more costly than the Illustrative Alternative Portfolio is for ratepayers. If a higher load forecast materializes, the cost to ratepayers for Site C will be less than the Illustrative Alternative Portfolio.
Let’s unpack that statement. Throughout its submissions BC Hydro has suggested that the Panel consider a mid load forecast in carrying out subsequent cost assessments. The Panel reports that it found the mid load forecast “excessively optimistic” and chose to use the low load forecast in conducting subsequent analyses. Now this is the critical point. Under the low load forecast the alternative renewables and demand-side management (DSM) portfolio is comparable in price with completing Site C. Thus the decision as to whether to cancel or complete Site C is not clear. This is important because as the Panel points out, under the mid load and high load forecasts building Site C is clearly the better decision for ratepayers. Thus the entire conclusion of this Report depends on which forecast was chosen by the Panel
The question arises therefore: why did the Panel decide to rely on the low load forecast (which made the decision a toss-up) rather than the mid load or high load forecasts (which make Site C a slam dunk)? Well the answer to that is simply mind-blowing for me. As detailed on page 81:
Given the uncertainty, the Panel finds additional load requirements from potential electrification initiatives should not be included in BC Hydro’s load forecast for the purpose of resource planning. Although available information indicates that the effects of electrification on BC Hydro’s load forecast could potentially be significant, the timing and extent of those increases remain highly uncertain.
As someone who has been active on the climate change file this almost knocked me off my chair. The Panel decided that one of the primary tools for fighting climate change (reduction in reliance on fossil fuels via electrification) should be completely omitted from consideration in assessing future electricity demand in BC. My regular readers will note that the entire basis of my submission to the BCUC Inquiry was the need to consider the electricity needs associated with reducing our dependence on fossil fuels. When the preliminary report came out I was a bit surprised that the Panel had omitted any discussion of the Paris Agreement and our climate change goals. I saw that as an oversight and commented in a follow-up submission. Now I realize that it was a deliberate decision. It is as if the Panel lives in a world where Canada never signed the Paris Agreement.
That left me to wonder, why would the Panel make such an extraordinary decision? Well Mr. Morton, the Chair of the Panel, explained it this way in a radio interview on CKNW radio:
We can’t make any predictions about what government policy would be in the future so our analysis did not include potential changes of government policy. They included what government policy is today and we pointed out that government policy would certainly change things…..if government electrification policy changed that would change demand. Again we couldn’t really make assumptions about what policy may or may not be in the future.
Reading and re-reading that quote I cannot believe that the Chair of the Panel (a regulator) could make that statement in light of what we already know about climate change. What is even more disconcerting is that page 129 of the Report includes text from Section 2 of the Clean Energy Act that defines British Columbia’s energy objectives and enumerates the requirements to reduce our emissions by 2050 while referring them back to the Greenhouse Gas Reduction Targets Act. To clarify, the province has a whole slew of “Climate Action Legislation” on the books. One of the primary ways of decarbonizing in a manner consistent with the Clean Energy Act (and the other applicable Acts) is via electrification and yet the BCUC suggests they can’t foresee policy implications that include electrification?
You might ask how the Panel came to this conclusion? Well that answer goes back to a critical weakness of this process: the rush to complete it and the absence of time for the Panel to effectively weigh the evidence they were presented against the body of scientific research in the public realm. Benjamin Disraeli is attributed with the quotation: “History is made by those who show up“. In this case the people who showed up to talk to the Panel were the activists who want the project cancelled and they brought their paid consultants with them. The people who did not show up (with some limited exceptions) were the scientific community of British Columbia. The result was that the panel was flooded with misinformation and anecdotes and lacked the time (and possibly expertise) to effectively weed out the bad information.
Since electrification represents the key factor in differing between the low load and high load forecasts let’s consider the Panel’s analysis and findings against electrification. On page 81 under “Potential disrupting trends” the Panel indicates that it leans heavily on the work of Hendriks et al. (Hendriks) This begs the question: who is this Hendriks fellow? Well according to his online CV, Richard M. (Rick) Hendriks is the Director of Camerado Energy Consulting Inc. which has been working for the Treaty 8 Nations against the Site C project since at least 2010. He is, or until recently was (I really don’t know), being paid to oppose the project.
Hendriks’ submission includes at its core the details from a paper that I have previously addressed at this blog. In my original blog post I note that the previous work by Hendriks and Dr. Karen Bakker of UBC attempts, and in my opinion fails, to discount the research from the Deep Decarbonization Pathways Project (DDPP) and Trottier Energy Futures Project (TEFP). That work was produced for, and ultimately reviewed and published by, Environment and Climate Change Canada (ECCC) in their assessment report on Canadian energy needs under various climate change scenarios.
In a practical sense what we have is a difference of professional/scientific opinion. On one side we have research groups from leading research institutions in 16 of the world’s largest greenhouse-gas-emitting countries; a team of more than a dozen energy experts from the Canadian Academy of Engineering; all overseen by a team of subject matter experts from the Federal government. On the other side we have a consultant “trained in engineering, science and social science” who has spent the better part of a decade working for a group opposed to the dam and a water governance expert. Would anyone care to guess which side the Panel believed? Well it was the gent who showed up and talked to them in person (Mr. Hendriks). Thousands of hours of analysis by dozens of the world’s top subject-matter experts was dismissed by the Panel who chose instead to rely on the guy who showed up for a presentation and to answer questions.
The Panel also mysteriously chose to trust Mr. Hendriks over the far more qualified Dr. Jaccard (and his research Group) when it comes to electrification of British Columbia’s vehicle fleet. Once again the explanations are hard to explain. Dr. Jaccard and Associates prepared an Electrification Potential Review that included estimates of electricity demand under a number of scenarios and assumptions. The report concluded that electric vehicles would result in Terra-watt hours of demand which would have, once again, driven us from the low load to the mid or high load forecasts. Hendriks dismissed that detailed analysis by going back to a truly horrendous BC Hydro load forecast that suggested that by 2030 a little over 8% of British Columbia’s automobile fleet would be electric vehicles. [The link is to my analysis that demonstrates why the load forecast is so poor.] To summarize, the BC Hydro analysis assumes that about 8% of BC’s vehicle fleet will be electric vehicles in 2030. Now recognize, some analysts are claiming that we won’t be able to buy internal combustion engines in 2030 but the BC Hydro forecast used by Hendriks (and thus the Panel) assumes that electric vehicles will still be no more than a novelty at that point in time. To put it another way, we will have surely have failed in our fight against climate change if that is the case. So once again on one side we have a respected expert who provides a detailed analysis, supported by references to the peer-reviewed research, that shows a high demand for electricity in 2030 and on the other we have Mr. Hendriks who cites a back-of-the-envelope calculation from BC Hydro that pre-dates our signing of the Paris Agreement. Anyone want to guess who the Panel chose to believe? The guy who showed up to the meeting of course.
I can’t repeat it enough because this point is so important. The entire basis of the Panel’s conclusion that to build or not build Site C is a toss-up is based on the assumption that the BC and Federal Governments will do nothing to fight climate change. This in a province and country where both governments have dedicated massive resources to fighting climate change. Were the efforts to fight climate change through electrification included in the analysis then in the Panel’s own words “the cost to ratepayers for Site C will be less than the Illustrative Alternative Portfolio.” Looking at the Panel’s own report the basis for their discounting electrification is a couple paper-thin analyses that run exactly opposite to the massive consensus of scientific and regulatory opinion in Canada. Essentially we are making a $10 Billion bet that Canada will do nothing significant to fight climate change and the sole basis for that bet is an analysis done by a consultant working against the project and a low-quality BC Hydro analysis completed prior to Canada signing the Paris Agreement.