It is interesting to note that the Parliamentary Budget Officer’s estimate of a $578 million cost for Vancouver’s round-ball games is less than two weeks old and is already outdated. Official sources now say British Columbia’s cost for seven matches on the West Coast could reach $729 million.
The real need is for the province to appoint a royal commission with broad ability to investigate financial and engineering problems with all megaprojects. The inquiry should be able to compel public officials to explain processes that result in massive cost increases and troublesome delays.
All senior public servant involved in the approval or management of megaprojects that consume vast sums should demonstrate detailed knowledge of Professor Flyvbjerg’s work. Many works would not be approved and billions of dollars would be saved. Of course, our approaches to management of megaprojects will not change. Political leaders have half-heartedly addressed widespread concerns about fiscal irresponsibility and the influence of lobbyists. That is, if they have addressed the concerns at all.
The United Kingdom’s National Audit Office said about a nuclear energy megaproject that was to cost C$35 billion and now looks to be costing more than C$80 billion, years after initial completion: “[Government] has committed electricity consumers and taxpayers to a high cost and risky deal in a changing energy marketplace.” The NAO message is almost exactly the arguments raised about British Columbia’s Site C hydropower project her at IN-SIGHTS and by others demanding that public projects deliver value for money.
Professor Bent Flyvbjerg, Executive Chairman and co-founder of Oxford Global Projects has written about proponents getting large undertakings approved by using “strategic misrepresentation” when they conjure up budgets. Strategic misrepresentation is the planned, systematic distortion or misstatement of fact — lying — in response to incentives in the budget.
Wind and solar are zero-carbon energy sources. When used to produce electricity, these renewables are less harmful to Earth’s climate than hydropower. U.S. Environmental Protection Agency published a lengthy Inventory of U.S. Greenhouse Gas Emissions and Sinks. It shatters the idea that hydropower is clean energy, free of greenhouse gas emissions…
One is left to wonder why senior public officials do repeat business with global companies that have a history of delivering not on-time and not on-budget. Perhaps there are reasons not immediately apparent to the public…
Proponents of megaprojects routinely underestimate financial costs. After conducting an extensive study, top experts concluded this is caused by “strategic misrepresentation, that is, lying.” In addition, proponents invariably ignore environmental and social costs of megaprojects…
With news the BC Ferries vessel Spirit of British Columbia is about to sail to Europe for an extensive refit, I bump this article back to the top. – In October 2015, the Commissioner approved $173 million for the project but, as evidenced by the confidential order three months later, increased the approved amount by $46 million to $219 million. Instead of five times cost of the last refits, the 2016 multiplier is eight. So, whether it is $140, $173, $219 millions or an even higher cost subsequently revealed, whether the contract is completed by 2018, 2019 or later, I predict the refits will be advertised as completed on-time, on-budget. That tag is applied to all BC Liberal projects, no matter how many times the budget or completion date must be altered.
Large dams run 96 percent over budget on average, according to a University of Oxford study based on projects in 65 countries including Brazil and China. The study, published in the journal Energy Policy, showed that large dams also took about 2.3 years longer to complete than originally planned. That was about 44 percent longer than projected at the point of approval. The research was based on a study of 245 dams…
Today Pacific Northwest LNG announced what has been obvious for a considerable time. Unless the provincial government was prepared to guarantee profits and underwrite losses, the project was not proceeding. The writing was on the wall when this In-Sights article was published in 2014.
BC’s Minister of Energy said in mid October that the $7.9 billion budget for Site C had been examined by top international experts and was assuredly “reliable.” Two months later, Premier Clark revealed the dam budget had jumped to $8.5 billion. Days passed and when project approval was announced, the budget had jumped to $8.775 billion. Once again, the British Columbia Liberals demonstrate practiced mendacity. They are consistent though since mega-projects of the past five years typically doubled between first announcement and completion but were invariably pronounced to be on-time and on-budget. The mantra will be used again…
A brisk building boom of hydropower mega-dams is underway from China to Brazil. Whether benefits of new dams will outweigh costs remains unresolved despite contentious debates. …We find overwhelming evidence that budgets are systematically biased below actual costs of large hydropower dams — excluding inflation, substantial debt servicing, environmental, and social costs. …The outside view suggests that in most countries large hydropower dams will be too costly in absolute terms and take too long to build to deliver a positive risk-adjusted return
The British Columbia Liberal 2001 election platform had 37 references promising improved democracy, increased accountability or more open government. Its 2013 platform had none, because the party had lost interest in the goals, not because they had been attained. If ever any party strayed far from principles that first got it elected government, it is the one led today by Christy Clark. If you doubt my assertion, read through A New Era for British Columbia. That document was prepared by Gordon Campbell and his associates. Some will believe that it was a pack of lies from the start. Others would argue — excepting the page 9 promise to “not sell or privatize BC Rail” — that the Liberal Party started with good intentions and lost its way, corrupted by wealth and power…
Since toll revenue at Port Mann has covered only 39% of operating costs, the BC Government needs to explain how it will finance existing and future shortfalls on Port Mann/Highway 1. These are growing by about $5 million a month and paying for an even more costly tunnel replacement will demand a solution. One possibility was proposed in the original Gateway Program. It contemplated: “…tolling of all bridges connecting to the Burrard Peninsula, including the Lions Gate, Ironworkers Memorial, Pitt River, Port Mann, Pattullo, Alex Fraser, Knight Street, Oak Street and Arthur Laing bridges…”
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…
More than two year later, almost nothing has changed for people most in need. CBC News The following was first published August 8, 2013: In 2009, Delta South voters decided that one […]
It wasn’t on budget for the public but probably was for the private companies hidden behind the Sea-to-Sky Highway Investment Limited Partnership. Liberals are masters of public finance in one particular way. They deliver opportunities to deal makers and deal flippers, with details of all transactions hidden from view. It wasn’t long before the first flip happened on the Sea-to-Sky project.
October 15, I listened to Energy and Mines Minister Bill Bennett provide detailed assurance that, unlike budgets of numerous BC megaprojects that suffered runaway costs, the $7.9 billion Site C dam budget […]
When financial people mention “sunk costs,” they refer to expenditures that cannot be recovered. Almost 15 years ago, BC politicians learned the investment of hundreds of millions for fast-ferries had to be […]
When even Business In Vancouver spots an absurd causality in BC Hydro’s self-inflicted power demand "crisis" (mortal wounds!) be assured…
Psst! Clean Energy? Don’t tell “Cowboy” Carney or his MAGA best girl Danielle Smith about repurposing oil and gas wells…
Bread and Circuses? Bread or Circuses? Who will choose for us? Consider the Electric Vehicle... A while back 18 automobile…
Thanks Skylab for your content. I am a big fan of Naomi Klein and have read her book 'The Shock…
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In case you’ve been wondering - who supports huge Data Centres? Angus Reid has a poll. https://www.cbc.ca/news/business/bakx-york-ai-data-centres-alberta-solomon-9.7222388 Support 15% across…