BC’s dirty little secret

British Columbia’s dirty little secret has just become a big problem for WestPac LNG Corp. and its hopes of building a clean new source of electricity. On the surface of it, the province should be sweeping barriers aside for WestPac, given Premier Gordon Campbell’s dual promises to slash greenhouse gas emissions by a third by 2020 and to make B.C. self-sufficient in electrical power in just eight years.

WestPac’s natural gas plant on Texana Island in the Strait of Georgia should be able to help on both fronts, boosting B.C.’s output by 1200 megawatts and allowing the province to reduce imported electricity from Alberta and U.S. border states. Much of that electricity comes from coal-fired plants, the worst of the worst when it comes to greenhouse gas emissions. Replacing coal with much cleaner natural gas makes ample environmental sense.

There’s just one catch. B.C. Hydro doesn’t count those coal-fired imports in its official tally of greenhouse gases, a secret that makes a mockery of the government’s boast that 90 per cent of the province’s energy comes from clean sources. If that dirty power isn’t counted against B.C. Hydro, it’s as good as invisible when evaluating the environmental impact of projects such as the WestPac plant.

The result is that WestPac faces the peril of having its entire operation counted as a net addition to the province’s greenhouse gas tally, meaning that it would need to buy carbon credits in order to meet B.C.’s requirement that any new power project be emissions-neutral. Or maybe not. Faced with that uncertainty, the company has justifiably hit the pause button, saying that it will wait until early next year to file a detailed project description that would trigger a full-scale environmental review. “Really, we’ve got no direction either way from the government, and that’s why we’ve had to delay,” WestPac president Stu Leson says.

Mr. Leson makes the excellent point that British Columbia doesn’t have its own atmosphere - those coal-burning plants have the same effect on global warming, even if they are a few hundred kilometres outside of the province’s borders. Common sense says that point of view should carry the day, but the reality of B.C.’s growing addiction to dirty imported power says otherwise.

The legislation kicking off B.C.’s greenhouse gas initiative is to be tabled in the spring session, but the Environment Ministry is not yet able to say when the regulations underpinning the law will be drafted. Those regulations will hold the detailed answers that WestPac needs before it can figure out whether its project, $2-billion for just the first phase, is economically feasible.

Without an official tally from B.C. Hydro, it’s hard to measure the extent of the problem. But some rough estimates from the Suzuki Foundation found that the utility might be leaving two-thirds of its greenhouse gas tab unaccounted for. According to the foundation, those imports generated just over two million tonnes of greenhouse gases in 2005, substantially more than the official number of 954,000 tonnes. The Suzuki numbers indicate that greenhouse gases generated by British Columbia’s electricity consumption jumped 60 per cent between 2002 and 2005, vastly more than the utility’s numbers that state that emissions were essentially unchanged.

WestPac isn’t able to say what kind of environmental liability it faces. But if B.C. Hydro were to pay for the cost of its imported power with carbon offsets costing, say, $20 a tonne, it would be on the hook for something on the order of $40-million a year.

All of those numbers add up to two inescapable facts. Some time, very soon, the B.C. government will have to decide whether B.C. Hydro or private industry will bear the cost of greening the province’s power use. And private capital is not willing to gamble that it won’t be stuck with the tab, Mr. Leson says. “It’s just too much money to invest and take a risk.”

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