Workshop Date and Location March 2, 2005 Prestige Inn 209 Van Horne St. S., Cranbrook B.C. Attendees Name Chris Lague Lorne Shovor Bob Smith Emile Morin Martin Cullen Austin Parisien Warren Trimble Lloyd Sharpe Bob Campsall Kris Payne Interest/Organization Tembec Inc. Akisqnuk First Nations, formerly Columbia Lake Indian Band Councillor City of Kimberley Mayor, Village of Canal Flats Director Regional District of East Kootenay President Cranbrook Chamber of Commerce Sunrise Rotary, Cranbrook Aberfeldie/Elko CC Committee Elko Resident District of Invermere Tobacco Plains Indian Band BC Hydro/IEP Representatives Name Diane Tammen Kristann Boudreau Samantha Petticrew Cindy Armstrong Responsibility Community Relations Manager Kootenay / Lower Columbia Stakeholder Engagement Manager, BC Hydro (facilitator) Technical Resource (Consultant to BC Hydro s IEP Team) Note Taker 1. Introduction/Workshop Objectives Diane Tammen welcomed participants to the 2005 IEP workshop. Kristann Boudreau introduced the IEP team and requested that attendees introduce themselves, indicating the organization or interest they represent. The objective of the workshop was provided: to learn, share, and express regional preferences about different future electricity resource options. Kristann indicated that a second round of regional workshops would be held in the fall of 2005 to invite regional input about possible portfolios (packages of resource options to meet B.C. s electricity needs over the next 20 years). The agenda was reviewed and a presentation followed that provided an overview of the Integrated Electricity Plan (IEP) process. Meeting held March 2, 2005 at the Prestige Inn in Cranbrook Page 1 of 9
1.1 Update 2004 IEP/Overview 2005 IEP Attendees were provided with an overview of the 2004 and 2005 IEPs. 1.2 Update on the 2004 IEP An overview of the 2004 Integrated Electricity Plan included information on the direction of the plan, stakeholder and First Nation s feedback gathered, and regional feedback. 1.3 Overview of the 2005 IEP Process The 2005 IEP process aims to build on last year s plan. The process of the IEP steps and roles was provided to the group. An overview of the regional workshop process was reviewed. The 2005 IEP objectives were outlined and the engagement principles provided. Feedback from the previous night s public information session included: - interest in exploring opportunities for different scales of biomass facilities in the Kootenays - explore distributed generation - other factors to consider when making choices job loss, impact of climate change, some people would be willing to pay more for wind and other renewable sources. 1.4 Questions and Discussion Number of attendees at Information Session. An IEP team member confirmed that 12 people attended the previous evening s session. Support for biomass by information session participants. Four reasons to favour biomass were discussed at the evening information session: 1. The need to reduce forest fire risk 2. The need to deal with woodwaste pine beetle invasion 3. The desire to promote economic development 4. Concerns around encroachment of range land and dwindling feed for cattle and ungulates. One participant asked which priority is higher on the list for BC Hydro: the environment or maintaining reliability and low cost power? And if the priority lies with the latter, would this imply that BC Hydro will treat the environment as less important? BC Hydro responded that there is no right way to balance all of these priorities, and this is the reason BC Hydro is seeking public input. 1.5 Review Resource Options and Attributes A resource option overview was provided. It included an explanation of potential resource types, a review of current trends in demand and supply of energy and capacity, and an overview of the attributes. A Consequence Table was presented which provides a picture of the impacts of the various resource options based on the attributes. Meeting held March 2, 2005 at the Prestige Inn in Cranbrook Page 2 of 9
1.6 Questions and Answers When BC Hydro calculates the land impact attribute, does it take into consideration impacts on wildlife, etc.? BC Hydro responded that this attribute is based on surface area of land or water impacted. How many projects would it take to make up the bundle of 1000 gigawatt-hours (GWh)? BC Hydro responded that the portfolio required is approximately 20,000 gigawatt-hours (GWh) over the next 20 years. There is no one project that will meet the demand over the next 20 years. Why does biomass have no greenhouse gas (GHG) emissions? BC Hydro responded that it is part of the carbon cycle; it is considered net because if the trees were not being used to generate electricity, they would have decayed anyway, thereby releasing carbon dioxide and other GHGs. What kind of regulations exist for wind power if windmills were being built offshore? BC Hydro responded that the regulatory requirements are not clear at this time. Effects on availability of existing sources of electricity. Participants noted that two factors should be flagged as having the potential to effect the availability of BC Hydro s existing sources of electricity: 1. Columbia River Treaty 2. Climate change. 2. Introduction to Mock Exercises Direct Ranking of Resource Options and Swing Weighting of Attributes Participants were asked to perform two exercises. These would be the tools for discussion preferences among the different resource options. The first exercise involved a direct ranking of resource options according to personal interests. The second exercise involved swing weighting using the attributes. The group was asked to review the attributes and rank and weight the change of any one attribute from its worst value to its best. The second part of the exercise would include a discussion of the exercise results. 2.1 Questions and Answers Participants raised the following questions during the exercise: How much is 1000 GWh? BC Hydro produces approximately 46,000 gigawatt-hours (GWh) per year from Heritage Resources. As a rough estimate, approximately 100,000 homes would require 1,000 GWh (east and west Kootenays combined). It is about how much we need to add each year over the next 20 years. How long would it take to bring the Burrard thermal generating station (in the Lower Mainland) back up to its full operating capacity? BC Hydro responded that Burrard currently operates three of its six generating units from time to time. It would require an upgrade in order to continue operating, and it is estimated that it would take approximately three to five years to secure approval for that kind of upgrade and to complete the work on the facility. Meeting held March 2, 2005 at the Prestige Inn in Cranbrook Page 3 of 9
Post Meeting Note: Burrard is subject to an MLA review. Decisions about Burrard s future would be driven by this review. Is Hydro currently exporting? BC Hydro has sufficient resources for its own demands and when economical it trades with Alberta or the U.S.A. in order to keep rates low. BC Hydro will continue to ensure that there is always a sufficient power supply to be able to supply all the needs of its customers in B.C. without having to rely on imports. In addition, BC Hydro will not plan to add new sources specifically for exports. I heard BC Hydro wrote off a bill from California for $700 million, and at the same time I keep hearing low cost power: if we keep writing off bills how can we keep quoting low cost power? BC Hydro responded that revenues from power sales to this jurisdiction were in the billions during that period. For comparison, $300 million was written-off. Why is nuclear power not mentioned? BC Hydro responded that nuclear power as a resource option is against current provincial government policy. Do we base our opinions on what is best for the East Kootenays or the province? Do we make decisions based on the assumption of what is economical here? Participants were encouraged to take a provincial scale perspective. What does BC Hydro do pertaining to research and development? Do they research old resources such as dams, or do they look at new technologies such as cold fusion? BC Hydro representatives noted that there is an active research and development program, but they were not able to describe specific programs, and offered to follow-up. How much land would be flooded for Site C? BC Hydro s response was that it would be about five times the amount listed in the Consequence Table. 2.2 Discussion of Mock Exercises - Direct Ranking of Resource Options, Swing Weighting of Attributes Kristann shared the results of both Mock Exercises. Individual results varied from participant to participant. High value was placed on avoiding air emissions, land impacts, and cost. Lowest value was placed on jobs and flooded land. Combined group rankings suggested that: Most preferred options include Power Smart, small hydro, wind, and biomass Least preferred options include coal, geothermal, natural gas Large hydro straddled the divide, with conditional support for Site C, but not necessarily for other new developments 2.3 Participant Comments and Discussion The following comments are grouped according to resource options, but include thoughts offered by a variety of participants: Large Hydro: Site C would not have as large an impact as constructing a large hydro project from scratch. Preference that major dams not constructed on any free flowing Meeting held March 2, 2005 at the Prestige Inn in Cranbrook Page 4 of 9
river, and thus would consider Site C as an option. Water is going to be a required commodity. BC Hydro already owns Site C, therefore that drainage is already committed to hydro power. A participant stated that too many large environmental impacts of large dams exist. A participant indicated that dams are nice, but we are looking for ways to maintain wildlife corridors. Renewability of options is important. Large water storage and reserve is the best option. Treat Site C on an as needed basis. Coal: Participants are interested in coal, but want improvements in air emissions. Coal development is an option with installation of an air scrubber. Coal could supply all of Canada from this region. Coal is dirty, but participant suggested looking at near term practicality. One participant predicted that scrubbers would be used in the near future. Biomass: Biomass has potential that is not being used. Biomass and recycling regulations should be implemented; a participant cited Finland as an example of a country that has laws indicating that nothing can be landfilled. Biomass would allow clean up of the forest to intervene on forest fires, therefore improving air quality. Forest clean up for biomass would also help the grassland environments, encroachment and ungulate populations. It could also be a cost effective way to countering slash and burn techniques to get rid of the undesirable forest growth. Smaller biomass facilities could provide five years supply of electricity. A combination of run of river, wind and biomass along transmission lines could reduce transportation costs in shipping waste to plants. Cogeneration plants would need to be of a certain size to make them viable, and BC Hydro would be the only customer. Can BC Hydro make it work and make money at it? Fuel supply in this area is not suitable, and shipping would be needed. Supply is not unlimited so need sources to be shipped in to make the plant viable. The last 55 to 60 years has created the most biomass. Biomass facilities are not feasible. Small Hydro: The problem is lack of access to the transmission system. Opportunity exists in mountain communities for this resource to help support regional communities. Small hydro has opportunity without a large impact. Small hydro has few downsides, but diminishing returns with respect to new technologies. Wind: Wind power has potential on the coast. There is not a lot of opportunity in local area, but there is more in other areas of the province. Wind could be used for 10 to 15 per cent of demand. It would be worth obtaining supplemental energy in times when the wind doesn t blow. Geothermal: It s important in Kimberley because of the Sullivan mine. While they are drilling they could also explore this option. Potential for geothermal. Natural Gas: Participants believe there are better uses for gas. Power Smart: Everyone can do better with Power Smart. There is no downside but diminishing returns, as a move is made to new technologies. Power Smart buys time to plan ahead for resource options. It buys more than time it buys a better attitude for future planning and conservation. 2.4 Discussion of Mock Exercises Consistency Check A consistency check was provided to show which resource options attendees might be predicted to choose, based on the importance they placed on various chosen attributes. Some Meeting held March 2, 2005 at the Prestige Inn in Cranbrook Page 5 of 9
participants results showed a high level of consistency between their direct ranking of resource options, and the weight they placed on the various factors affecting their choice. In other cases where there were inconsistencies; this created an opportunity to talk about whether there were other factors (not included in the Consequence Table) that were affecting participants choices. 2.5 Participant Comments on Consistency Check The following comments were made: The workshop exercises restricted our thinking; however, the portfolio should be looking at synergies (for example, combination of wind and large hydro). We can t have one without the other. Some reasons for inconsistencies include looking at wind potential in water areas not on land. Others focused on the renewable nature of resources. Biomass would have local benefits beyond just employment. We have trees out there to burn so let s burn them. It reduces risk of fire, provides a use for pine beetle wood, and grassland preservation. A short discussion on methane generation ensued. Participants asked if it makes sense to lump landfill waste burning with woodwaste burning? BC Hydro responded that the method of burning is different. It makes sense to burn landfill waste. It is separated in the IEP, but not in this exercise. Woodwaste was chosen. Benefits include avoiding shipping of garbage and burning close to load. Questions and Discussion One of the benefits of large hydro is the ability to store water and release it later when it s needed. Participants recommended that BC Hydro look at opportunities to expand existing facilities that have seasonal spilling to make them more productive. Do large hydro reservoirs emit GHGs? BC Hydro responded that decaying material emits GHGs after the land is flooded. If the reservoir is logged the amount will be minimal. Grassy areas would likely emit more. BC Hydro s reservoirs are deep and old so emissions would likely be lower. Under Kyoto they will be considered. Consider a construction attribute. Costs and impacts of construction should be considered, not just the generation (operating) stage. Future trends. Participants commented that we look at a moment in time the trend that s happening. We are not considering the impacts of climate change or the trend of recycling. We should be looking at future trends or consequences. A lot of the options rely on weather, which is a positive. There s a need to test sensitivity to future trends that could affect supply or demand (climate change, Columbia River Treaty negotiations). Also, what would happen if industrial demand rose dramatically? We need to be watching and making contingency plans. Supply and demand is constantly monitored for these trends. Fish is important and hydro dams are a major issue with First Nations people. Wildlife is also a big issue. The Species at Risk Act should also be considered an attribute. BC Hydro noted that any specific project that was recommended under the IEP and associated Action Meeting held March 2, 2005 at the Prestige Inn in Cranbrook Page 6 of 9
Plan would still go through all the usual regulatory approval processes, including the federal and provincial environmental approval process. There is nothing more important than to make the atmosphere healthy by keeping GHGs in line. GHGs have a high value for being in attributes. The bottom line appears to be cost, and now these things are subject to regulations. A participant expressed concern that these regulations would not protect us in the long term, concern that environmental protection is not working. Approval of alternative projects that are not lowest cost, but meet policy commitments. If there is interest in doing things right, then cost should not be the driving force. BC Hydro is committed to obtaining 50 per cent of new supply from clean sources. If this is the mandate, these sources are more expensive. BC Hydro will have to go to the BC Utilities Commission (BCUC) to request a rate increase to pay for the new sources and the public will say no. Inefficiency of using natural gas to generate electricity. If rates increase, consumers will replace electric appliances with gas. In the call for generation on Vancouver Island, BC Hydro chose a gas plant. Historically, most houses had oil or electric heat; participants were not sure that BC Hydro is using this resource wisely. There s another level of integration between energy and electricity; it can be done more efficiently. BC Hydro is trying to respond to demand is it an energy demand or an electricity demand? Synergies should include all forms of energy. 2.6 Values Exercise Recap 2.6.1 Resource Options to Consider Participants recommended the following resource options be considered: Solar power Opportunities to partner with owners of dams at existing facilities to harness spills Small biomass facilities Synergies and combinations (for example, wind/large hydro, hydrogen fuel cells), reliability Large hydro (would not be ranked high generally, but Site C might be acceptable given all the trade-offs) 2.6.2 Other Attributes to Consider Participants recommended the following attributes be considered: Measure of land impacts should also include fish and wildlife habitat impacts Synergies of high and low reliability Storage benefit of large hydro GHG emissions from reservoirs Costs of construction, not just generation Proximity to load (portfolio levels) Regional benefits of biomass (risk of forest fire, economic use of pine beetle wood, and grassland restoration) Add renewability of resources as an attribute Meeting held March 2, 2005 at the Prestige Inn in Cranbrook Page 7 of 9
3. Presentation on BCUC Regulatory Requirements An overview was presented on the BCUC Regulatory Requirements that BC Hydro must comply with. The topics covered included: BCUC s scope, responsibility, approval process and regulatory requirements Description of the Resource Option Report (ROR) and the characterization of attributes The Resource Expenditure and Acquisition Plan (REAP) Questions and Discussion How does BC Hydro determine supply and demand when there are opportunities for export through the grid? BC Hydro has sufficient power to meet its own needs, and will continue to plan for that. When selling power, they have a reliability standards requirement to ensure avoiding the risk of blackouts. BC Hydro adds resources to meet its own needs and trades when there is excess from dams that have multi-year storage. One participant commented that in Alberta, the majority of power is generated by coal and steam and operated to supply at base load. In B.C. the majority of power is generated by hydro plants and able to turn off and on very easily. The interconnection at Crow s Nest Pass allows electricity to pass back and forth when Alberta needs peaking. Interest in commenting on research and development policy. The whole business of research and development, the key to meeting future needs, works best with economies of scale to fund it. The future of current policy suggests that research and development should be key to the planning ability of meeting future needs. There should be room to re-visit policy by BC Hydro to do more research and development. A participant strongly supported, that 30 to 50 years down the road, nuclear will be a strong electricity producer, therefore there is a need to start research in this direction. Consider solar energy as a resource option; does BC Hydro have any idea how much land area is required for this option? BC Hydro responded that this was looked at in the 2004 IEP, and commercial and individual scales were identified. It is currently more expensive on a dollars-per-mw basis than other resources. Downstream benefits. A participant commented that a portion of downstream benefits should go to BC Hydro for future programs. 3.2 Presentation on BC Hydro s Long Term Goals An overview was presented on BC Hydro s Long Term Planning Goals, including: Reliable power at low cost for generations. BC Hydro s purpose to ensure reliable electricity service, ensure the benefits of historic low cost, and proactively manage resources. Purpose will be fulfilled through 15 long term goals, the goals will be pursued within policy and regulatory environment, and the 2005 IEP process. Goals influencing the IEP: customer reliability of supply, environment, financial, enable Western opportunities. Goals supporting the IEP: social (First Nations and stakeholder engagement). Meeting held March 2, 2005 at the Prestige Inn in Cranbrook Page 8 of 9
4. Next Steps A summary of the day s proceedings will be posted on the BC Hydro website. The website also contains additional information such as presentation materials, notes from all regional sessions, and Provincial Integrated Electricity Plan Committee (PIEPC) progress. Attendees were asked to advise if they were interested in being involved in the second round of regional input next fall: all expressed interest in returning. 5. Action Items Will we have a chance to see and comment on possible portfolios? Yes, the PIEPC will share a range of possible portfolios with regional participants and ask for input later this year, in the fall of 2005, before heading in to their final deliberations. Contact Details Website: www.bchydro.com Phone: 1-888- BC Hydro Email: IEP.2005@bchydro.com Meeting held March 2, 2005 at the Prestige Inn in Cranbrook Page 9 of 9