A Chemist in Langley

Last evening, while relaxing, I imagined a fascinating debate. It involved the Climate Scientist Dr. Andrew Weaver (Sci W) going up against the Politician Dr. Andrew Weaver (Poli W) on the topic of the Site C Dam. The basis of this debate was a Globe and Mail story where Poli W was recanting the earlier views of Sci W. In reading the commentary from Poli W I couldn’t help but recognize that a debate between the two would highlight both the strengths and weaknesses of our scientific and political debate about climate change, renewable energy and the Site C Dam.

To begin let’s look what the article says about Sci W’s views on the Site C Dam project

“I cannot see what is stopping Site C,” Mr. Weaver said eight years ago. At the time, Mr. Campbell was launching an ambitious climate-action agenda and Mr. Weaver concluded it was time for BC Hydro to get back in the business of mega-projects to produce more emissions-free energy. “They should be carving out their niche with the Site C dam,” he said.

What was missing from the new article was the full context of what Dr. Weaver said back in 2009:

“The only solution, to be perfectly blunt, is to go carbon neutral.” And the only way to do that, he said, is for BC Hydro to get back in the business of mega-projects. “They should be carving out their niche with the Site C dam,” he said.

“I cannot see what is stopping Site C,” Prof. Weaver said. “There are environmental consequences, yes, but there are environmental consequences for everything we do and we have to stop using the atmosphere as an unregulated dumping ground.”

Looking back at 2009 Sci W we have a classic climate scientist approach to a problem. Note the absence of a scintilla of doubt and the absolute certainty in advancing the cause. I can assure you as a someone, who regularly gets lambasted by climate scientists and politicians for my pragmatism; Sci W would have had no time for the complexities and political niceties evinced by Poli W.

Now let’s look at what Poli W has to say:

“What has changed is the economics,” he said in an interview.

In 2009, he was convinced the hydroelectric project would help British Columbia meet aggressive targets to reduce greenhouse gas emissions. He also believed that with a construction budget of $6-billion, Site C was the most economic way to generate more greenhouse gas-free electricity.

“This, at the time, was the cheapest way of getting clean energy,” he said. “There is no question, this is clean energy.”

However, he said it didn’t take long for the math to fall apart. The cost of wind and solar has dropped dramatically, while the construction cost of the dam has climbed. As well, the increased demand that BC Hydro forecast has not materialized – in fact, domestic demand has declined since 2008. And, a federal environmental review panel brought to light the negative impact on the rights of Indigenous peoples in the valley.

“To be blunt, one of the things I didn’t consider back when I was a climate scientist, thinking about nothing but climate science, was the issue of First Nations’ rights and title,” he said…

…We’ve killed this nascent industry that was ready to take off here. These were producers who work in partnership with First Nations in British Columbia.”

So how would the debate have played out? Well I’m guessing that as a scientist Sci W would have directed Poli W to the latest research on renewable energy prices in BC. The easiest place to find useful figures would be BC Hydro’s latest detailed electricity supply option analysis. This analysis is regularly updated (with the latest wind update dated in 2015). Let’s look at what this assessment says about costs of wind power:

Estimated unit energy cost for onshore wind power ($2015): $81 to $301/MWh

Estimated unit energy cost for offshore wind power ($2015): $180 to $635/MWh

These numbers come with an incredibly important proviso:

Note that costs associated with off-site access road improvements and off-site transmission systems are not included in these estimates as it was not part of the scope of this mandate.

As I have previously discussed, at length, access to the transmission system is the Achilles heel of most wind projects. In British Columbia, most of the major wind resources are not located proximate to population centers and as such transmission costs can greatly increase the cost of a project. Consider that the Northwest Transmission Line project is looking to cost over $2 million a kilometer to build. Smaller feeder lines are, of course, much less expensive, but building transmission systems in BC represents no minor task and to not even consider those costs in the calculus would underestimate the price of wind significantly.

For simplicity sake, however, lets completely ignore those transmission costs and just look at the facility costs. To be clear, the BC Hydro wind numbers are higher than the generic US average number presented by Energy BC but since the BC Hydro number considered actual conditions in BC and even differentiated  by region, I am wont to trust the detailed local analysis over the generic US number. Looking above we see that the absolute cheapest of the alternatives (without transmission) goes for around $81/MWh. Now consider that all-in (including transmission and estimated cost-overruns) the “unaffordable Site C” is anticipated to produce firm electricity at a cost of $83/MWh.

Given the above information, I’m sure Sci W would make mincemeat of Poli W’s economic arguments. At this time wind is not cheaper than Site C and unlike Site C, wind facilities have useful lifespans of only about 20-25 years and are notoriously intermittent. To give an equivalent to the firm power supplied by Site C you would need several generations of facilities (with ensuing decommissioning costs) and you would need to massively overbuild since a wind turbine with a name-plate capacity of 2 MW typically produces a generating capacity of 0.6-0.8 MW. As for the flat demand I’m sure Sci W would provide the same argument that I did in my previous blog post. That any scenario where we attempt to fight climate change will result in an increased demand for electricity.

As for geothermal, well while $83/WMh represents the lowest end of the wind range it is above the bottom of the geothermal range (Estimated unit energy cost ($2015): $71 to $398/MWh). That being said, geothermal has its own issues with land use and transmission and even then the average facility far exceeds the established Site C cost. Looking at these numbers Sci W would have a pretty easy argument to make that Site C remains one of the most economical of the green energy alternatives on the board in BC with geothermal coming a close second. Wind, while every activist’s favourite comes a sorry third.

As for the suggestion that Site C is killing off a nascent industry? While that has been the argument made by organizations like the Canadian Wind Energy Association but according to BC Hydro they are still accepting offers and signing electricity purchasing agreements. Admittedly the Standing Offer Program may have issues and is not assigning any volume for 2020 and beyond but that is supposedly contingent on them reviewing their current price and volume targets. Ultimately, it is my understanding that the lack of accepted plans comes down to a simple assessment of costs and BC Hydro simply trying to get the best price for their consumers. There simply aren’t enough low-cost wind projects on the existing map to come close to replacing the capacity provided by Site C.

Realistically the only argument presented by Poli W above that would not be immediately refuted by Sci W would be on the topic of First Nations’ rights and title. This is a topic that typically is ignored in the scientific calculus. The argument used by the climate activists has always been that indigenous peoples are likely to be the ones most harmed by climate change so this project would represent the lesser of two evils.

Author’s note: I am going to take a quick break from the format to be clear here. I do not agree with this argument. Historically disenfranchised and underserved communities and peoples should be the last ones asked to bear the brunt of our battle against climate change. Any efforts to fight climate change have to acknowledge and respect Treaty Rights and look to minimize what we ask of these communities and peoples. 

Returning to our format: in this case I believe that Poli W is clearly on the right track. There are important issues of First Nations’ rights and title that seem to have been poorly managed during this process. I am not a road engineer, but I cannot see why the road could not be re-routed (at a cost) to avoid the sensitive areas under dispute. I understand that BC Hydro has been in negotiation about compensation to the affected First Nations and that some First Nations are in support of the dam but this is a topic about which I know too little to comment further. Ultimately, however, I think the First Nations right’s argument would go to Poli W.

Imagining the proposed debate, I can’t help but think that Sci W would polish the floor with Poli W. Admittedly, Poli W would make up some ground on the First Nations file but on the topics of energy price and economics Sci W seems to have all the supporting data.

Ultimately, however, the Site C file becomes a litmus test on individual feelings about risk tolerance with respect to climate change and climate change mitigation. This is because any clear-thinking individual who believes that we are facing an existential threat from climate change cannot help but support a project that (according to the data) provides some of the cleanest and least expensive low-carbon energy out there. If we, as a nation, decide we are going to meet our Paris Agreement commitments then the demand curve for electricity is going to swing upwards and Site C becomes a necessity. There are simply not enough economically viable wind/geothermal plans in the planning stage to provide the power will will need if we are to carry out a fundamental transition away from fossil fuels in time to make a difference for our planet.

Alternatively, if your view is that we are going to simply mouth words about climate change while continuing to use oil, gasoline and natural gas at current rates then there will not be a demand for Site C power and it becomes a white elephant.

In completing this post I recognize there might be a third position, but to me it is an untenable one. It is the position of many of the activists who keep holding out imagining that some glorious energy break-through is on the horizon that will make Site C unnecessary while simultaneously making these alternative energy projects more cost-efficient. Hoping to be rescued by a unicorn is not a pragmatic approach so I will simply leave that idea there for your consideraton.

Irrespective of all the above, it is my belief that more must be done to get better buy-in of the project from the affected First Nations. As I have pointed out, I’m not a social scientist and I don’ know that part of the file very well; but doing right by the affected parties seems a minimum requirement for the Site C project.

One of the most common talking points used by the activists in the battle against the Site C Dam project has been that energy efficiency and energy conservation can more than make up for the electricity generated from the Site C Dam. This is well-described here:

an increase in population doesn’t necessarily translate into an increase in demand for electricity. B.C.’s population grew by more than half a million people since 2005, while demand for electricity remained more or less flat.

Eoin Finn, a retired KPMG partner, ran the numbers on Site C and electricity demand. He tells us that even though B.C.’s population is growing, “savings from energy efficiency and using appliances that are less energy consuming” have slowed demand.

The argument thus runs: we have absorbed a half-million people into BC in the last decade with no commensurate increase in electricity demand and therefore we can absorb another 1 million in the next 20 years without increasing demand either. As I will discuss in this post, I believe this is a dangerous fallacy. While energy efficiency initiatives are necessary, they will not address our growing electricity needs in the future. This is why we need new projects like the Site C Dam.

Let’s start with where we agree. As presented here since 2005 BC’s population grew by a half-million people while demand for electricity has remained essentially flat. In the next 20 years the population of BC is expected to grow by approximately 1 million (or by 22%). Mr. Finn argues that these 1 million can be absorbed into our population with little increase in electricity demand. This is simply not correct. As I will demonstrate, the problem with this argument is that it ignores the strides we have made in energy efficiency in the last 20 years and assumes that we can duplicate those improvements in the future. This is simply not a reasonable argument to make.

Let’s start by looking at what it has taken to achieve the energy efficiency we see today. Anyone who has lived in BC in the last 25 years knows about the Power Smart program. Started in 1989, Power Smart has been a valuable program intended to drive down individual residential consumption of electricity. Since 1989 conservation efforts have provided the equivalent electricity to power 440,000 homes a year. How has it been done? Through Power Smart programs they bought back old fridges, encouraged the purchase of Energy Star appliances and phased out the use of incandescent light bulbs in our province.

Now as the owner of a 25-year-old house I can point out that since my house was built every appliance has been replaced. That is the nature of appliances, they simply don’t last 30 years anymore. Personally, in the last decade, every non-Energy Star appliance in my house has been replaced with an Energy Star one. Similarly, most of the incandescent light bulbs in my house have been replaced with CFL and, more recently, LED bulbs that use a lot less power. Looking around my house I’m not sure where I can make further efficiencies in electricity use. My children have been raised knowing that they are expected to turn off the lights in empty rooms and my heat and hot water are from natural gas so that doesn’t help either. Looking at my house, and the houses in our neighbourhood, I can see that all the major efficiencies that can be made, have been made. There are no more easy tricks to reduce electricity demand.

On a regional level, given Power Smart initiatives and community standards, virtually every house built in the last decade has all those efficiencies built in. Consequently, Power Smart is starting to miss its goals. It is not for lack of trying, but rather because we have now reached a new state where most houses are pretty darned efficient. Certainly by raising power rates we can drive down demand somewhat (as I have noted previously) but all the big savings are now already incorporated into the system. Some have suggested regulations might be able to further reduce the load but that will be politically challenging and still won’t get us where we want to be. Essentially what I am trying to say is that our transition from inefficient to highly-efficient residential electricity use is essentially complete. Any further increases in efficiency are going to be costly and will not have anywhere near the effect that the changes of the last 25 years have already achieved.

Looking at the information presented above, it is now clear how we managed to absorb a half-million people into our province with little additional demand. But we can’t replicate that miracle with the next 1 million. There aren’t that many two-decade old fridges to buy back and new houses start out with energy-efficient bulbs in all the sockets. This explains why BCHydro load forecasts (caution big file) anticipate sales to the residential sector to grow by about 325 GWh per year (1.7 per cent). That growth is based on projected housing starts. Those houses, however efficient, are still going to need electricity to operate. So even though our per capita electricity use has gone down in the last 25 years, that decrease is the direct result of a major transition from low-efficiency to high efficiency systems.

Another feature of electricity demand ignored by the activists is the effect of reducing our reliance on natural gas in the residential sector. As I noted above, my house and the houses around it are heated and heat their water via natural gas, but that era may be coming to an end in much of the province. Consider the City of Vancouver’s “Zero Emissions Building Plan” which sees heat and hot water moving from natural gas to electricity. Even if new buildings built in Vancouver are built to passive building standards this will result in an increase in electricity demand. The energy savings will come at the expense of natural gas, not electricity. I’m not even going to discuss electric vehicles here as I have addressed them previously, suffice it to say that adding electric vehicles should not be expected to reduce electricity demand in BC.

Ultimately, BC’s residential sector represents 34 percent of BC Hydro’s domestic sales and, as discussed above, our population is anticipated to grow by 22% in the next 20 years. Contrary to what has been suggested by the activists, that growth cannot be accomplished without a commensurate growth in electricity demand. We have made great strides in energy efficiency in the last 25 years and in doing so have driven down our per capita electricity demand. We have reached a level of efficiency that means that further decrease will be potentially expensive and painful and even then will be more than made up for in our moving away from natural gas in the residential sector. So, I say this to the anti-Site C activists. If your argument is that energy efficiency is going to make up for our electricity demands going into the next decade then you had better demonstrate how that can be so. Simply stating that we did it before and therefore can do it again ignores the reality on the ground;, or put another way, when losing weight losing the last 10 lbs is a lot harder than losing the first 10 lbs.