When I report quantities of electricity sold by BC Hydro, the numbers, taken from BC Hydro’s quarterly and annual reports, include these classes of customers:
- Residential,
- Light industrial and commercial,
- Large industrial.
I exclude “Other Sales” because it is a category the utility has been using to create an illusion of growing domestic demand.
BC Hydro, in response to my FOI inquiry, admits that in the past three fiscal years, most — about 85% — of electricity sales in this category is where, in their words, “consumption is external to BC.”
As the chart indicates, this game began a few years ago, a time when a pattern of flat demand had become firmly established. That situation was one BC Hydro adamantly refused to admit.
With static demand, utility managers believed citizens would not support steadily increasing purchases of private power and an aggressive asset acquisition program.
Their solution was to massage the numbers. This involved including sales to customers outside BC as part of domestic demand.
If we had experienced more truthfulness from BC Hydro, the province would not be spending billions on Site C. Not only is the project an option more expensive than alternatives, domestic demand does not support the addition of any new sources of power beyond those involving upgrades of existing generating facilities.
BC Government’s uneconomic policy:
In three fiscal years (2015, 2016 & 2017), BC sold the Canadian entitlement to Columbia River power to customers outside BC and realized $357 million. Meanwhile, BC Hydro paid IPPs $1.2 billion for the same quantity of power. #SiteC #bcpoli— Norm Farrell – In-Sights.ca (@Norm_Farrell) May 16, 2018
https://platform.twitter.com/widgets.js
May 17 update
In comments, a reader says:
…everything I’ve read here… seems to show only shallow understanding of system requirements, if any at all.
…if the system peak demands the additional capacity, then the squawks if it were not added and the system crashed would far outweigh what’s going on now. Obviously the current system meets the average need at present, but that doesn’t mean it’s not close on peak.
In fact it is the writer of that quote that has a shallow understanding of BC Hydro operations. Not only has total consumption been flat since 2005, so has peak demand. The evidence is drawn from BC Hydro’s own reports.
The chart ignores capacity contracted from IPPs that measures in the thousands of megawatts. BC Hydro’s internal capacity can be boosted by upgrading or adding to generators at existing dams (Revelstoke 6, for example). Meeting peak demand is not a problem in the forseeable future. The utility’s capacity/consumption ratio has never been in better shape. Meeting peak demand is not a justification for Site C.
The person commenting worries about integrating renewables with BC’s existing power network. That is typical of people involved in old style utilities. Renewables are disruptive, which makes people in the power business uncomfortable.
The Economist noted that renewables do not just lower prices; when used by customers, they also eat into demand. When fewer people rely on the grid, the industry faces a “utility death spiral.”
#SiteC proponents want us to believe that human resources are available to build a dam on a difficult site but integrating renewables is too complex to be achieved in BC, even if it is done elsewhere in the world. #bcpoli
— Norm Farrell – In-Sights.ca (@Norm_Farrell) May 18, 2018
in-sights.ca 
Thank you Bill Malcolm for your understanding gained through your experiences.
In BC they used to have Burrard Thermal for peak loads which I think were Natural gas turbines which delivered an awesome amount of power just for peak loads, but were not efficient?
Perhaps someone else can tell me I’m all wrong about this.
My understanding is that BCHydro closed it down which seemed crazy.
Just a citizen on the edge of knowledge here trying to stay informed.
Hugh
LikeLike
Liberals forced closure of Burrard Thermal even though it had been upgraded to provide reasonably clean power and could have been further improved. The ostensible reason was to reduce carbon emissions, but its production was replaced by IPPs, several of which were gas-fired thermal and biomass power facilities, which were also carbon emitters.
In fact, Liberals intended to reduce production of electricity by publicly owned installations, so they could promote private generation. I’ve also been told that real estate developer friends of the government coveted the Port Moody lands on which Burrard Thermal is located.
If we ever have a disruption of electricity flowing through power lines from northeast BC, southwest BC will rue the day Burrard Thermal was closed.
LikeLike
Another misleading impression that Hydro is throwing out there with this kind of reporting is that our utility generation asset base is growing because of Hydros investments. I think that transmission lines to nowhere, with no markets, are liabilities rather than assets. I think that smart meters that have made far more mistakes, if they are mistakes, in metering, are liabilities rather than assets. Norman, am I wrong that BC Hydro is now considering future income as an asset against deferral accounts? Is that included in the growing asset list?
LikeLike
Unfortunately the U.N. has bigger fish to fry, so to speak. We are on our own on this one. The B.C. Lieberals started the province down this road and the N.D.P. is staying on track.
I want to know why. What is driving Horgan to stay on this track. He isn’t so dumb that he’d believe the beaucrats placed there by el gordo or Christy, I do hope. I never did trust Meggs while he was running Vancouver, so is he the problem.
The Greens have been a tad quiet about this, now they did object to this in the beginning and it isn’t enough to bring down the NDP and replace it with the B.C. Lieberals. However, you really do have to wonder. I’m not happy with Site C. Its costing us a load of money. Unless Horgan felt there would be political fallout if he cancelled site C. I really don’t know why he is doing this. of course if it is political fallout, I’d much rather the NDP say, if we can site C we won’t win the next election. ON the other hand, they’d go down like Barrett’s government. We all know Barrett’s decisions are still making this province a good place to live all these years later.
Perhaps this is the saw off, they go with Site C and try to can the pipeline.
LikeLike
There are laws that are supposed to protect the public from this kind of chicanery. One of them is section 181 of the Criminal Code, which states, “Every one who wilfully publishes a statement, tale or news that he knows is false and that causes or is likely to cause injury or mischief to a public interest is guilty of an indictable offence and liable to imprisonment for a term not exceeding two years.”
Wilfully “massaging” the numbers in statements to the public to hide static demand has likely and arguably caused injury to a public interest. But this is British Columbia.
Unfortunately we have a situation in British Columbia whereby successive provincial governments, enabled by entrenched denizens of the Attorney General’s ministry, have been able to ignore the law when expedient. In fact, in the BC Rail case those entrenched denizens went beyond enabling and actually broke the law themselves while successive governments have expediently looked the other way.
This situation could not co-exist with a vigilant and courageous press. But again, this is British Columbia. We may ultimately have to look to the United Nations for relief.
LikeLike
TransLink has been doing the same thing for years.
LikeLike
Given that Mr. Horgan intends to pursue the Christy Clark/LNG dream I believe he will say site C is necessary for that industry. Sad that our province continues to be governed irresponsibly. Sad too that our environment is the ultimate loser.
LikeLike
Demand has a specific meaning in utility parlance, and it’s not energy sales measured in watt-hours over a year as proposed here, but the peak power use in watts over a given much shorter time period. For a end-user with a demand meter, that time period is typically 15 minutes, and they are charged for peak use as well as energy consumed over a month. For a system as a whole, an hour is often used as the demand period. It’s based on not overheating utility equipment which would reduce service life. Demand as you use it is not germane to the issue unless the utility experiences very little variation between peak and average loads on its system. But you cannot divine that from your graphs. Not a hope.
Peak to average demand is called load factor. Absolute system peak is the capacity that has to be met, say on the coldest day of the year. A poor system in the utility’s eye is when the customers impose a large peak demand compared to average, say 2 to 1, for a 50% load factor. You need double the nameplate generator rating capacity compared to average need, or the lights will go out. Typical peaks occur when everyone gets up at the same time on a cold morning, turns up the heat, showers (turning on electric water heaters), plugs in the kettle and coffee pot, runs toasters and skillets etc. Then an hour later, that demand all ends.
As an retired utility engineer from the East Coast, I’ve never understood why the bloggers here going on about BC Hydro seem to show zero awareness of system hourly demand, both peak and average.
If you were an intervenor at the NS Utility and Review Board, on say a rate increase application, and went on only about energy sales as you do here, you’d get nowhere with the Board at all with this one-dimensional analysis. As many who tried this approach decades ago found out the hard way. And then educated themselves to argue on even terms.
I’m not au fait with all the facets of BC Hydro’s current situation, and perhaps it is as bad as you say. Certainly the previous Liberal govermment seemed to ride roughshod over both the utility and public utilities regulator people particularly with regard to IPPs. That is not BC Hydro’s “system”, but an imposed externality that tends to screw up system planning in strange and hard-to-predict ways. It still has to be somehow accommodated of course.
However, everything I’ve read here or from a previous blogger on ProgBlog seems to show only shallow understanding of system requirements, if any at all.
I see no reason for BC Hydro to have an inherent political bent itself unless its management and board are a bunch of rah-rah Chamber of Commerce types chosen by grasping politicians, in which case my condolences. But to control those urges is why there is an independent public utilities commission. Has that been gerrymandered?
If Site C was imposed on BC Hydro rather like a giant IPP by the government, that’s one thing. However, if the system peak demands the additional capacity, then the squawks if it were not added and the system crashed would far outweigh what’s going on now. Obviously the current system meets the average need at present, but that doesn’t mean it’s not close on peak. Been through some nail-biters on that front.
But reading these blogs for years, I haven’t a clue what the case actually is in BC, because the analyses published don’t come close at even a basic level to giving me any idea. 25 years as a metering engineer who liasied with Rates all the time makes me wonder what is going on in BC with all this furor over what should be straightforward engineering.
The critics may well be arguing at cross-purposes with reality, but who knows based on this not very complete analysis as repeatedly published? Not me and I actually have a clue as to what it takes. What’s here is nowhere near enough for decent understanding, or on which to base criticism for change. Seriously.
It’s like people dancing over cheap energy from windpower. It’s true so far as it goes, but when it is actually fed into the grid is crucial for load scheduling of base load generation. If it were as easy as pie to run a system, then man-on-the-street understanding of the factors involved would be the norm. But, it isn’t.
If Site C is really not needed based on some in-depth analysis, I’d be all in favour of not ruining the countryside and changing local climate as big bodies of water tend to do. That’s my beef against hydropower, unintended consequences you’re stuck with in addition to the obvious ones. Perhaps pumped storage on the existing systen would suffice to meet peaks. Putting giant batteries in the system would also work if you don’t count the rape of current lithium deposits worldwide, or child labour digging up cobalt in the DRC to make them. There are few easy choices.
LikeLike
In fact, peak demand in British Columbia has not increased, according to BC Hydro’s records. If you were a regular reader, you would have known that as it is discussed in a few places, including in the article We are the losers, who are the winners?:
“…Peak demand — or the amount of power consumed during the busiest hours — has also remained flat over the last decade, coming in at 9,317 MW in 2006 and 9,602 MW in 2016. Looking back to 2004, peak demand was actually higher than it was in 2016, so over the last 12 years, it’s actually declined.”
LikeLike
Sounds like a possibe method of unneeded excessive asset acquisition.But who benefits and when would the public wakeup?
Do premium ,long term,IPP private power contracts with built in inflation rates push the publics dams to level 2 supplier where we have to buy 24/7 regerdless and our dams just dump the water?
LikeLiked by 1 person