private power producers get sweet deal with premier campbell in BC

[southsidedelite]

SFU Profs Slam Campbell's Energy Plan
Hobbling BC Hydro so private firms can profit big is bad public
policy.
By Rafe Mair, Today, TheTyee.ca

Goal: Sending our energy south for private profits.





Two Simon Fraser University professors, both experts in power issues,
have written scathing critiques of the Campbell government's energy
policy.

First, they affirm the argument I've been making for over a year --
that BC Hydro is being forced to buy private power at up to double its
market value, sell it at a huge loss, and then, assuming that this
idiotic government tubes Burrard Thermal as our backup power, it has
buy back that power at high import prices!

Here's how Professor Douglas McArthur confirms that opinion on his
blog PolicyCentre.ca:

"Private hydro produces most of its power in the spring and summer
when B.C. already has a surplus of power from BC Hydro's already
established plants. It doesn't need more power in the spring and
summer when the runoff is high. But the government is making BC Hydro
buy the power from these producers at inflated prices, even though it
will have to turn around and sell it into export markets at much lower
spring and summer market prices. Then, in the winter, BC Hydro will
have to buy very expensive power from producers in the U.S. The
private hydro producers will make a lot of money, Hydro will lose huge
amounts of money on the whole complicated deal, and BC Hydro customers
will make up the difference in higher rates... [The] government
explanations just don't add up when subjected to scrutiny. If this was
happening in India or Pakistan we would be raising no end of
questions."

Dr. Marvin Shaffer, an acknowledged power expert also from SFU,
confirms this analysis, concluding that the Campbell government "force
[s] BC Hydro to look only to the private sector to develop new sources
of energy, no matter how costly and low in value many of these sources
are, or what cumulative environmental impacts they have."

What's good about this deal?


In a nutshell, then, Campbell forces BC Hydro to buy all the private
power produced on a "take or pay basis" at up to twice its value at a
time when its not needed, meaning Hydro must sell it at half price
into the export market and buy it back at much, much higher prices if
they do need power.

How do they get away with it?

The Campbell government plays upon the public's inaccurate
understanding that the Burrard Thermal power plant is a huge despoiler
of the environment -- in fact, it uses relatively benign natural gas
for power and it's only used in rare times of emergency with a
minuscule, short-term environmental impact. [By way of aside,
hospitals and media outlets have this sort of backup, and what else
would one expect? So do many citizens especially in Lions Bay where I
live, which is subject to power losses more often than elsewhere. No,
I don't take it personally! The environmental impact of these
emergency backup arrangements is minute.]

What, then, will happen to BC Hydro?

At present it's on the hooks for $31 billion in future "take or pay"
contracts which will, it's estimated, double if the Bute Inlet private
development goes through. Every new license ups the ante. So, how does
BC Hydro handle this?

BC Hydro is not permitted to bring new power on stream, with the
exception of upgrading its own facilities and bringing on the Site C
dam. The latter is hugely damaging to the environment, and unpopular.
In fact this is a "man of straw" because Campbell and company are
setting up a false dichotomy: it's either private power or Site C.
This is nonsense.

How long can Hydro buy high, sell low and be deprived of its back-up
in Burrard Thermal for those few days a year it requires its power?

Citizens will have to pay

Is it any wonder that the SFU professors are looking for a reason for
all of this madness?

This so-called "energy policy" is indeed mad. No intelligent
government would create such an idiotic scheme. In fact, in speaking
to citizens around the province as I did last spring, even in the face
of unassailable evidence people were reluctant to assume that any
government could be so stupid. They doubted me -- even though I
reminded them of Mair's Axiom I. Namely, it is: "You make a very
serious mistake in assuming that those in charge know what the hell
they're doing!"

What, then, are BC Hydro's options?

The first is obvious. It fails to meet its obligations and it is, for
all intents and purposes, put into bankruptcy with its assets sold to
pay off its capital debt. Now, if that seems like indigestible public
policy, remember that with BC Rail, that's precisely what happened --
despite the most solemn of vows from Gordon Campbell not to do it.

The second is perhaps more likely. BC Hydro simply raises its domestic
prices so that we the people -- with our businesses and industries --
finance the heavy losses resulting from its forced export of private
power. In short, the dividends paid to shareholders of large offshore
companies are being paid by us through our electricity bills, and
through the cost of energy passed on to us by corporations. Think on
that as your electricity bills come in!

This cannot be stated too often:

1. We do not have an energy crisis in B.C. All future needs can be met
by employing conservation methods, upgrades to present Hydro
facilities and Hydro putting generators on flood control dams -- and
by taking back the Columbia River benefits in power rather than taking
it in money.

2. Even if we were short of power, how can it be replaced by private
power when that power is only created at a time when BC Hydro can't
use it? Clearly, when the government says we must have energy self-
sufficiency by a certain date -- energy which will come from private
power -- they are terminologically inexactituding through their teeth!

Here it is in a nutshell. Kim-il Campbell and the pusillanimous
lickspittles he surrounds himself with are shattering our environment
by ruining our rivers and the animals and vegetation they sustain.
They're making out with province shareholders rich with our public
resources. They're either bankrupting BC Hydro, the most important and
successful of our crown corporations, or forcing it to make the B.C.
citizens pay with their own electricity bills for the immense profits
of private companies.

And here's a question for the premier that he's utterly failed to deal
with -- every year BC Hydro pays the province hundreds of millions of
dollars by way of dividend, which goes to our schools and healthcare.
Now this money is sucked out of B.C. and into the pockets of private
shareholders like Warren Buffett.

Why are you doing this Premier Campbell?

There is absolutely no sense to this policy which devastates us
environmentally and fiscally, so why are you doing all this to our
wonderful province which has been entrusted to your care?

Rafe Mair writes a Monday column for The Tyee. Read previous columns
by Rafe Mair here.

8
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make_up_another...
6 hours ago

Suggest as offensive
Is There Nothing Privatisation Can't Do To Improve Life?
Leverage the efficiencies of the private sector! Only business can
provide tomorrow's solutions! Government is inefficient! Free markets
encourage competition and brings lower prices! It never ends.

I heard coverage of the UN Security Summit. Guess what? Yep! Only
industrial farming and massive acceptance of GMO crops can produce the
yields to feed the masses! Again, the private sector uses its amazing
powers of ingenuity to bring prosperity to the masses!

They're like broken records these people. You hear one of their shills
being interviewed on the latest world problem, bracing yourself for
the long awaited words of wisdom...I'm like, wait for it...wait for
it...bam! Only private sector know-how is gonna carry the day lads!
Let's just give them the keys to the printing presses and be done with
it! Oh, wait...we've pretty well done that, haven't we?

Gary
3 hours ago

Suggest as offensive
A Terrible Realization
I have just realized that we are not only going to pay for this
"private power" but we as consumers are going to pay huge crippling
amounts.
When you look at your hydro bill there is a two tier price system.
When you consume the first Tier the price jumps.Considerably.
So when all this "best money managed" sytem of Gordos comes on line
they will just increase the rates of the second tier by enough to
bankrupt the lowest income earners. That system was never put there to
help people reduce their footprint. It was put there to get a
ridiculous amount of money from the public.

Campbell and his gang have to be stopped. They are ruining this
province for the sake of privatization.

Jeffrey J.
2 hours ago

Suggest as offensive
General Strike Feb. 12, 2010
A general strike would bring thousands and thousands of people
together to begin the process of regaining our democracy....

The alternative is very dark indeed...

BC Mary
2 hours ago

Suggest as offensive
Will "make_up_another..." please stand up
and attend the big rally of the New Democrats later this month?

Then sit down and sign your nomination papers for whatever opening
there is, at the top-end of this crazy Opposition, to lead them out of
the maze and into the real world as you clearly see it.

Or ... oh dear. Maybe I just went over the edge and this is the the
great vision that's supposed to unravel before our mind's eye in the
final desperate moments of our lives ...

whatever, it was nice to hear your point of view in a province where
Lies are Truth, and the Great Destroyer is being featured as GREEN
king.

Blessings upon Rafe, too, for never giving up on this Run-of-the-
Rivers issue.