Site C dam unlikely to be on time or on budget: BCUC report

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Report: Site C cam unlikely to be on time or budget
WATCH: A new report from the B.C. Utilities Commission says that the controversial Site C project is unlikely to be on time or budget. As Keith Baldrey explains, delaying the mega-project would be the most risky and costly option – Nov 1, 2017

The controversial Site C dam is unlikely to be on time or on budget, according to a highly anticipated report from the B.C. Utilities Commission (BCUC).

The report said that the commission is not persuaded that the project can meet its initial completion date of 2024, and warns that costs could climb “in excess of $10 billion,” possibly exceeding it’s original $8.3 billion budget by 20 to 50 per cent.

LISTEN: BCUC releases final report on Site C dam

However, the report does not make a recommendation on whether the project should continue.

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Back in August, B.C.’s NDP government ordered to review the controversial $8.9 billion project, and provide guidance on three alternate possibilities: finishing the dam, cancelling it or pausing it.

The final BCUC report says that third option, pressing pause, is the least attractive scenario, adding an estimated $3.6 billion to the price tag.

LISTEN: Energy minister responds to BCUC final report

The panel found that cancelling the project and re-mediating the site will cost about $1.8 billion, on top of the cost of finding alternative power sources.

The report said B.C. Hydro’s forecast for future power demand to be “excessively optimistic,” and warns risk factors could result in power demand being lower than Hydro’s low-end estimate.

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It also said alternative energy sources, such as wind and geothermal power, could provide equally priced or cheaper electricity.

Speaking to reporters on Wednesday, Energy Minister Michelle Mungall said the province was ruling out the possibility of suspending the project, and would now decide on either completing it or cancelling it.

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“This is a very serious decision and we are taking it very seriously and that’s why we want to have a decision before the end of this year.

The government will now examine the report in detail and consult with First Nations before choosing how to proceed, Mungall said, adding she is sensitive to the plight of the workers employed by the project.

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LISTEN: Former chair of Site C panel responds to report

“There are over 2,000 people working on-site right now and there are also people working in the area, all of whom are very concerned about going forward and what the future is,” said Mungall.

On time and on budget

Speaking for the Liberals, Mike Bernier said, their position on the project hasn’t changed and they see only one option for the government.

“Do they take $4-billion and write it off, go against what’s happening up in the area right now? Or do we continue on with the project? Obviously from my end and our position is we need to continue on with this important project.”

Bernier said prior to the NDP coming into office, reports on the project showed it was on time and on budget.

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Final nail in the coffin

But Green party leader Andrew Weaver said the report should be viewed as “the final nail in the coffin.”

Weaver said he was thrilled with the report findings.

“We’ve criticized the BC NDP for simply wanting to delay. They have a very difficult decision to make. The decision is, in my view, clear.”

And Weaver said the review gives the evidence needed to make that decision.

Mixed reaction to final report

Former Chair of the Site C panel, Dr. Harry Swain said the commission’s report doesn’t bode well for the project’s future.

“Because they’re reasoning leads strongly in the direction of termination. They weren’t called on to make a specific recommendation but, if you read the text, it’s clear where their hearts are.”

LISTEN: Independent Contractors’ Business Association responds to Site C report

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However, Jordan Bateman with the Independent Contractors’ Business Association suggests the BCUC has underestimated the province’s demand for electricity, particularly in the context of climate change.

“We’re moving to electric cars, electrification of our society, the fuel uses are going to continue to drop. The two words in this document, that I cannot believe are not in it, are the Paris Agreement.”

Meanwhile, Marc Lee with the Canadian Centre for Policy Alternatives says there’s only one option left.

“The economic findings are really bad for Site C. I’d find it hard to imagine the B.C. government could approve it in all of those factors.”

He said the numbers no longer make sense to continue the project.

Project review

A preliminary report on the dam was delivered in mid-September.

That report found that the project was on track for its scheduled 2024 completion date.

However, it asserted that a lack of information in virtually all other areas prevented it from offering findings on whether the project was on budget, or what the costs to ratepayers would be to suspend or cancel it.

WATCH MORE: Wed, Aug 2: NDP government sends Site C for review 

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NDP government sends Site C for review

It also raised concerns about the dam’s financing, noting that B.C. Hydro had underestimated the cost of a key contract and had already used up 45 per cent of its $794 million contingency budget in just two years.

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Earlier in October, B.C. Hydro admitted it would miss a critical construction milestone to divert the Peace River by 2019, a delay it said would not interfere with the final completion date, but one that will add $600 million to the final tab, bringing it to $8.9 billion.

Cabinet is expected to make a final decision on the project by the end of the year.

-With files from Liza Yuzda, Matt Lee, and Isabella Zavarise

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