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Norm Farrell

Gwen and I raised three adult children in North Vancouver. Each lives in this community, as do our seven grandchildren. Before retirement, I worked in accounting and small business management. Since 2009, I have published commentary about public issues at IN-SIGHTS.CA.

Back scratching

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An old expression says, “You scratch my back and I’ll scratch yours.” The maxim doesn’t require rewards for scratching be equal and, often, they are not.

According to Elections BC, AltaGas Ltd. and associates contributed a little more than $70,000 to the BC Liberals. It’s been money well spent… At $110,000 per GWh, AltaGas’ revenue from BC Hydro would be worth $143 million in 2016…

Vancouver Sun and snake oil rhetoric

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Overall, says Dermod Travis of Integrity B.C., the Gateway transportation plan — other components include the Port Mann Bridge replacement, widening of the Trans-Canada Highway, and the North Fraser Perimeter Road — overshot budget estimates by more than $2 billion. Travis warns that of 18 projects announced by the B.C. government since 2003, nine hospitals are over-budget by 12.6 per cent, seven transportation projects are 59.2 per cent over budget, and the Vancouver Convention Centre Expansion Project and a new roof for B.C. Place were 68.1 per cent over budget. Then there are the provincial government’s large-scale information technology projects. Reporters Lori Culbert and Rob Shaw found them plagued by operational problems, behind schedule, and $350 million over budget… Finally, there is the abysmal B.C. Hydro file…

Walk more lightly on the earth

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…The changeability of the future suggests to us that megaprojects are becoming less of a credible answer. They are a huge capital drain and carry a great deal of financial risk.
…We also know, better than ever before, that no means of generating electricity is environmentally benign. Hydroelectric dams can flood large areas of land and can impact aboriginal people and their lifestyles. Fossil-fuelled generation creates sulphur dioxide, nitric oxide, carbon dioxide and greenhouse gases that impact global warming and deplete the ozone layer…
One even more significant source of “supply,” in one sense of the word, is demand management or energy conservation — and it has dramatically fewer or nil environmental effects.
…demand management is much more than a good deal for the environment. It’s also a great business deal for Hydro’s customers. Furthermore, this is not a bridge or a “quick fix” until the next supply stations can be built…

Liberal hypocrisy

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…In broader terms, Holm emphasized, “The land to be flooded by Site C is capable of producing high-yielding fresh fruits and vegetables for over a million people.”

…Much like the Liberal Government did to the BC Utilities Commission – barring the public’s independent energy watchdog from reviewing the economics and need for Site C – it has also stripped the Agricultural Land Commission (ALC) of its lawful oversight of the biggest potential land removal in its history.

…Beneath the 15,000-page reports, the political shenanigans with the review process, and all the rhetoric about economic development lies a simple truth: Last year, BC generated about 110% as much electricity as it needed, but produced, at most, 48% of the food it consumed. In other words, while we have plenty of electricity to power our homes and businesses well into the future, the same thing cannot be said about our food security…

IPPs received $672 million above market price in 2015

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I’ve been reviewing more than 20 years of BC Hydro records and they show gradual growth in electrical demand until 2005. Subsequently, there has been no demand growth; in 2015, domestic power sales were lower than ten years before. What did grow were Hydro’s purchases of electricity from independent power producers. In calendar year 2006, 5,636 GWh supplied by IPPs cost $368 million (6.5¢/KWh); in 2015, 14,418 GWh cost Hydro $1,217 million (8.4¢/KWh).
A 155% increase in the volume of IPP purchases is alarming by itself given the lack of need for it but the average unit price has been rising steadily. In the 4th quarter of 2015, IPP unit prices were 9.2% higher than the preceding quarter. To accommodate power coming into the system, BC Hydro had to choose between shutting down their own capacity or dumping power in markets outside BC at well below cost…

Reward without risk for worthless surplus power

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British Columbia’s government believes less in free enterprise than in assisted activities for approved associates. Entrepreneurs saw potential for a private power generation industry in the province but didn’t want to risk their own money. Instead, they arranged with the Liberal government for the public to accept all risks and guarantee substantial profits to the schemers…

The doctor prescribes

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Few people have led lives more unique than Dr. Mike Webster. After success as a pro football player, Iron Mike earned a place in the Canadian Wrestling Hall of Fame. He then practiced as a clinical psychologist and worked frequently with police services. After Webster criticized its leadership, the RCMP first threatened, then dissociated him. That did not stop the psychologist…

Twitter bits

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The final item may present a clue to the current state of British Columbia’s energy market. It’s hard to believe we came to this only through the sheer stupidity of our policy makers.

News from the echo chamber

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Columnist Vaughn Palmer reports concerns expressed by Moody’s Investors Service about growing BC Hydro debt. The agency stated the obvious, which is that numerous capital projects are adding billions to the public utility’s debt and higher electricity rates or contributions from government are necessary. Palmer repeats Moody’s judgement that Hydro’s financial metrics “are among the weakest of Canadian provincial utilities.” However, the Vancouver Sun pundit provides an inaccurate explanation of why the situation exists…

Heart of our economy gets ignored

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When government is captured by people pursuing fortunes in real estate development and resource exploitation, the interests of all others become secondary. When the bubble bursts, when phantom markets collapse, what remains?

Small and medium‑sized enterprises employ about 2/3 of Canadians employed in manufacturing. Yet government programs typically aim benefits at large multinational corporations. An example in British Columbia is the arrangement allowing large, mostly foreign owned, mining companies to defer payments for electricity for up to two years. Additionally, Government directed BC Hydro to spend about a billion dollars on transmission lines that primarily powers the Red Chris open pit mine of Imperial Metals, which is controlled by Christy Clark’s favourite fundraiser, Murray Edwards. Substantial expenditures are also being made in the Northeast gas fields, even though government revenue from that resource has turned fugitive…

What’s good for the BC Liberals may not be good for BC Hydro

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Energy and Mines Minister Bill Bennett announced a five-year, $300 million hydro bill deferment plan for 13 mines owned by six companies.Never mind that B.C. Hydro is already grappling with its own deferral problems to the tune of $5 billion. Make no mistake, there’s a price to pay when B.C. Hydro becomes a political arm of government. The intertwining of self-interests gets complicated, while the interests of ratepayers can take a backseat to political interests. Three of the six companies in Bennett’s deal were highlighted in a December Financial Post article, “Debt risks mount as Canada’s base metal miners sink deep in the hole.”

What’s wrong with this picture?

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What’s really wrong is that BC Hydro has been spending billions on new capacity but producing less power. Demand has not grown since 2005 but purchases from IPPs, between FY 2005 and FY 2015, rose 108% from 6,444 GWh to 13,377. The purchasing is up again in 2016, by about 11%. The cost of IPP power was almost $500 million more in FY 2015 than in 2013.

When you’re determined to reward IPP friends but have too much power and no profitable export markets, you shut down your own low-cost operations…

Know and ‘No’ to LNG

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…To gamble away our world class treasure of a river and the cultural and economic values that are sustained by it for a relatively few short term jobs that will leave us with less than nothing when they end, to give away our birthright to a corporate entity some call the Malaysian Mafia, to imagine that there is anything natural about fracked methane, that thousands of kilometers of pipeline across wilderness will leave streams and rivers and wildlife habitat intact, that massive dredging and construction in the Skeena estuary will have “no significant effect” on salmon and other species, that the earth can somehow afford yet another huge dump of greenhouse gasses into the atmosphere, or that this will somehow benefit our children and grandchildren, is to live in a dream world.