On June 15, 2023, BC Hydro announced a call for new sources of renewable, emission-free electricity to power British Columbia's clean economy. BC Hydro also filed an update to its 2021 Integrated Resource Plan ("IRP"), updating its 20-year strategy for meeting the future electricity needs of its customers.
This bulletin explores what is to be expected from BC Hydro's call for energy in the context of the IRP.
Why is BC Hydro seeking more clean energy?
BC Hydro now expects that the province will need new sources of clean energy by 2030 due to evolving consumer preferences, including the increasing demand for electric vehicles. Demand is also expected to grow among industry consumers, in particular within the forestry, liquified natural gas ("LNG"), and mining sectors.
BC Hydro expects industry to need more electricity due to strong commodity prices, expansion, and electrification of key processes, as companies ramp up their responses to climate change. This trend toward greater electrification is supported by federal, provincial and municipal incentives, and is likely to continue.
What kind of energy is BC Hydro seeking?
BC Hydro is seeking sources of clean or renewable energy. Under the Clean Energy Act S.B.C. 2010, c. 22, clean or renewable resources could include biomass, biogas, geothermal heat, hydro, solar, ocean, wind, biogenic waste, waste heat, and waste hydrogen. However, BC Hydro has confirmed its 2021 analysis that greenfield wind energy is the most cost-effective source of additional clean or renewable energy.
Further, BC Hydro is contemplating advancing utility-scale batteries to obtain fifty (50) MW of additional capacity as early as fiscal year 2027 and up to five hundred (500) MW of additional capacity by fiscal year 2030.
BC Hydro is also evaluating the performance of small-scale battery energy storage systems. After consultation with Indigenous Nations and the public, small-scale battery storage systems may be implemented in the South Coast region.
How much energy does BC Hydro want to buy?
Subject to approval from the BC Utilities Commission, BC Hydro will seek approximately three thousand (3000) GWh of new clean or renewable energy from greenfield facilities in the province able to achieve commercial operation as early as fiscal year 2029.
Additionally, BC Hydro may acquire approximately seven hundred (700) GWh of new clean or renewable energy from existing facilities before fiscal year 2028. BC Hydro will engage in a process of bilateral negotiation with individual independent energy producers for this additional energy.
When is BC Hydro seeking to acquire the new energy?
BC Hydro has already commenced pre-design activities, including consultation with Indigenous Nations, stakeholders, and the public in preparation to launch an acquisition process for new clean energy resources in the spring of 2024.
On a high-level, the IRP provides the following timeframe for the acquisition process:
- pre-planning work up to the call announcement, which will occur in the spring of 2023;
- a call for design and engagement up until BC Hydro's issuance of the call occurring in the spring of 2024;
- a bid process, including preparation and evaluation ending with the awarding of contracts in the spring or summer of 2025; and
- the implementation and construction of the approved projects with a target commercial operation date of the fall of 2028.
Who does BC Hydro want to acquire energy from?
In addition to greenfield facilities in the province, BC Hydro will be engaging with Indigenous Nations and stakeholders on a competitive energy acquisition process, focusing on Indigenous ownership. Coupled with the provincial announcement of $140 million in funding to the BC Indigenous Clean Energy Initiative, this suggests that Indigenous equity may be expected in any call process contemplated by BC Hydro.
Are there any additional upgrades contemplated for BC's energy infrastructure?
BC Hydro is also looking to:
- advance the first step of sequential upgrades to transmission infrastructure into the South Coast region to achieve approximately seven hundred and fifty (750) MW of additional transmission capacity for the South Coast region by fiscal year 2033.
- prepare to initiate a second step of upgrades to achieve approximately an additional five hundred and fifty (550) MW of capacity for the South Coast region by fiscal year 2040.
- continue to advance the Prince George to Terrace Capacitor Project to maintain its earliest in-service date of fiscal year 2028.
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