BC Government and BC Hydro Issue Call for New Sources of 'Renewable, Emission-Free Electricity' to Power BC's Clean Energy FutureFriday, June 16, 2023
Vancouver, BC, June 16, 2023--(T-Net)--The BC Government announced today that BC Hydro will move forward with a call for new sources of renewable, emission-free electricity to power British Columbia's growing clean economy.
The call is expected to launch in spring 2024.
In addition, the Province is also providing $140 million to the B.C Indigenous Clean Energy Initiative (BCICEI) to support Indigenous-led power projects, create economic opportunities for First Nations, and advance community self-determination.
"As we face the threat of a record fire season across Canada, the need to switch to clean power to fight climate change has never felt more urgent. The good news is that from electric cars to electrified heavy industry, British Columbians are taking action," said Premier David Eby. "To guarantee the affordable power for this important transition, we're working in partnership with First Nations and BC Hydro to generate more of the clean electricity that British Columbia needs to build our economy, and grow our role as a clean-energy superpower."
Electricity demand is expected to increase by 15% between now and 2030. This is due to economic and population growth, and as more homes, businesses and industries switch from fossil fuels to clean electricity. In the past six years, the number of electric vehicles on B.C.'s roads has increased by nearly 2,000%.
Updated demand forecasts filed by BC Hydro with the B.C. Utilities Commission today confirm that new sources of electricity will be required sooner than previously expected.
To ensure that it's ready to procure new power supply, BC Hydro says it is moving forward with the development of a competitive process to acquire more clean electricity.
This will be BC Hydro's first call for power in 15 years, and will target larger, utility scale projects.
BC Hydro will only acquire 100% clean, renewable electricity, including wind and solar. The call for power process will be designed by BC Hydro and the Province following engagement with First Nations, industry and stakeholders.
The engagement will include development of options regarding minimum requirements for Indigenous participation in new projects. The newly formed BC Hydro task force will also provide strategic advice.
The BC Hydro task force draws on further Indigenous and external energy experts to provide strategic advice on advancing Indigenous ownership and/or equity interest opportunities.
The task force has three key priorities:
Over the next 12 months, the task force will focus on identifying and implementing short- and medium-term actions that can advance these priorities.
"First Nations are key partners as we work to power B.C.'s growing clean economy with clean, renewable electricity," said Josie Osborne, Minister of Energy, Mines and Low Carbon Innovation. "Funding for the B.C. Indigenous Clean Energy Initiative will open up new opportunities for First Nations in clean-energy projects, including wind and solar, create local jobs, and support Indigenous self-determination."
The Province's $140 million contribution to the BCICEI will support smaller Indigenous-led power projects that may otherwise not be competitive due to their smaller size.
The BCICEI is a clean-energy funding partnership between the Province of British Columbia, the Government of Canada, and the New Relationship Trust. It provides support and capacity-building funds to First Nations communities toward the planning and implementation of clean-energy projects. The BCICEI is administered by the New Relationship Trust, an Indigenous-led non-profit organization that delivers federal and provincially funded programs in support of Indigenous capacity development and reconciliation.
BC Hydro expects to initiate a call for power in spring 2024 in order to acquire new sources of electricity as early as 2028. This may be followed by subsequent calls as the transition to clean energy continues to accelerate, and BC Hydro requires additional resources in order to electrify B.C.'s growing economy and meet the province's climate targets.
To read BC Hydro's 2021 Integrated Resource Plan, including recent updates, visit: www.bchydro.com/cleanpower2040
To follow the B.C. Utilities Commission review of the Integrated Resource Plan, visit: https://www.bcuc.com/OurWork/Proceedings
To meet the members of the new BC Hydro Task Force and learn about its work, visit: www.gov.bc.ca/BCHydroTaskForce
Three longer backgrounders follow.
Planning now for the future
BC Hydro is currently in a public regulatory review process before the British Columbia Utilities Commission (BCUC) for its 2021 integrated resource plan (IRP). The IRP outlines how BC Hydro will meet the electricity needs of its customers over the next 20 years, and reflects B.C.'s legislated greenhouse-gas-reduction targets and electrification. It's a flexible plan that allows BC Hydro to monitor changing conditions and adjust its planning to meet the future needs of customers.
Recently, BC Hydro has seen increased demand for power from across its residential, commercial and industrial customer base. The demand is coming from:
The IRP includes a number of ways for BC Hydro to meet future demand for electricity as required:
Updated demand forecasts indicate the need to acquire about 3,000 gigawatt hours per year of new clean or renewable generation, starting as early as 2028 - or the equivalent of enough electricity to power 270,000 homes. The first call for power is anticipated in spring 2024.
Getting it right:
In the past, BC Hydro bought too much power from independent power producers at the wrong time, and paid too much for it. This resulted in higher rates for people and businesses. For example, the Standing Offer Program was a continuous-intake program that provided long-term energy purchase agreements for small energy projects at a fixed price, increasing each year with inflation. When the program was indefinitely suspended in 2019, it was offering 25- to 40-year contracts at an average price of $108 megawatt-hour (MWh), well above the market price of power at that time.
To keep rates affordable for people, BC Hydro's upcoming call for power will incorporate learnings from these prior programs and from recent calls for power in other jurisdictions. This would include planning for smaller, competitive calls at regular intervals - better aligned with electricity demand - and setting cost-effective pricing that discourages projects that would provide the bulk of their energy during spring freshet, such as run-of-river hydro projects, when provincial demand for power and market prices are at their lowest.
Keeping it clean:
With 98% of its generation already coming from clean or renewable resources, BC Hydro is a leader in North America when it comes to clean energy. BC Hydro's future call for power will be for more clean or renewable resources only. The use of both wind and solar resources has increased significantly in the past few years as the technology has improved, the cost has come down, and installation times have shortened.
BC Hydro is well positioned to integrate additional wind and other intermittent energy projects, thanks to its flexible hydroelectric system built around dams with reservoirs that act as "batteries." The reservoirs store water and allow BC Hydro to ramp production up or down almost instantly. This means BC Hydro can now add power sources like solar and wind to the provincial system because it has back up from its hydroelectric facilities for when the sun isn't shining or the wind isn't blowing.
To advance reconciliation, and in alignment with the United Nations Declaration on the Rights of Indigenous Peoples, the Province and BC Hydro are committed to supporting First Nations economic and climate-action aspirations by ensuring opportunities in the clean-energy sector.
The Province and BC Hydro will work with First Nations to design a call for power that includes a minimum First Nations ownership in the project. Immediate consultation will also commence with First Nations and the First Nations Energy and Mining Council on options for Indigenous economic participation requirements. This will include discussions around partnerships, project procurement opportunities, benefits-sharing agreements, and appropriate evaluation criteria for Indigenous participation.
Planning for a future call for power will also be informed by the newly formed BC Hydro task force. The task force was created in March 2023 as part of the Province's New Energy Action Framework to ensure that BC Hydro is well positioned to electrify B.C.'s economy and industry as the province transitions to a clean-energy future. The task force provides strategic advice on accelerating electrification, modernizing the regulatory framework, and advancing economic opportunities in clean energy.
Generating opportunities for Indigenous clean-energy projects
The Government of British Columbia and BC Hydro are committed to designing a future power-procurement program that aligns with the Province's implementation plan for the United Nations Declaration on the Rights of Indigenous Peoples and provides opportunities for Indigenous people in the clean-energy sector.
By generating revenue that can build capacity and be reinvested, and creating jobs and training opportunities, clean-energy projects spur a variety of community initiatives that support Indigenous self-determination.
The Province is providing $140 million to the B.C. Indigenous Clean Energy Initiative (BCICEI) to support the development of smaller Indigenous-led power projects to respond to future electricity demand and limit the potential impact of these projects on BC Hydro ratepayers, keeping rates affordable.
The New Relationship Trust (NRT) will invest the $140 million from the Province, and interest earned on those funds will provide an ongoing provincial contribution to BCICEI's current programming, including project feasibility and site selection, environmental review and permitting, project design and engineering. A key strength of BCICEI is an Indigenous-government-stakeholder governance model that pursues consensus decisions on program parameters and project approvals.
In parallel, the NRT and the Ministry of Energy, Mines and Low Carbon Innovation will work with BC Hydro, PacifiCan and First Nations to design a new BCICEI funding stream to help offset the higher anticipated cost of power from smaller Indigenous power projects as they reach an advanced stage of development in 2028-30. As grid-connected Indigenous energy projects reach a prescribed milestone, NRT would enter into agreements with Indigenous proponents to provide the new program supports, eventually drawing down the $140 million contribution.
The BCICEI was launched in 2016 with funding from Western Economic Diversification Canada (now PacifiCan) and subsequent contributions from the Government of B.C. It provides support and capacity-building funds to First Nations communities toward the planning and implementation of clean-energy projects, such as hydro, wind, biomass, solar, marine or geothermal projects. The initiative is helping to reduce reliance on non-renewable fuels, while generating clean energy in First Nations communities. BCICEI has delivered $26 million to support 100 clean-energy projects in First Nations in B.C. since 2016.
The NRT was created in 2006 through an agreement between the First Nations Leadership Council, the Government of B.C., and the Government of Canada, with a commitment to strengthen relationships on a government-to-government basis, and a recognition that transformative change requires Indigenous-led funding approaches.
Vancouver, BC (Government)
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