The BCUC approved BC Hydro’s purchase agreements to buy electricity from new power plants. But the narrowly focused decision will do little to satisfy complaints from First Nations, and there’s a whiff of hypocrisy in the government’s claim that they are committed to reconciliation.
Introduction
BC Hydro, the province’s largest electricity utility, initiated its 2024 Call for Power to buy private sector electricity to meet a looming deficit. Last December, ten projects (nine wind and one solar) were selected.
The Utilities Commission Act requires the BC Utilities Commission (BCUC) to review and evaluate electricity purchase agreements to ensure they are in the public interest, so in February BC Hydro applied for approval of contracts from the winning bidders to buy up to 4,830 gigawatt hours (GWh) of electricity.
In June I predicted:
“The BCUC will probably do what the government wants, and approve BC Hydro’s contracts on the basis that other Crown agencies will do more consultation with First Nations in future. If it is feeling really brave, it might carve off the two most problematic contracts and insist BC Hydro do its own consultation, but I think this is unlikely.”
Let’s take a look at what actually happened.
The proceeding
For the most part, the proceeding was uncontentious. Everyone accepted the need for more electricity, and there was only minimal grumbling about the price BC Hydro paid for it.
The big question in the proceeding was: had BC Hydro done sufficient consultation with First Nations, and was it correct to delegate its consultation to the bidders?
Indigenous consultation
BC Hydro acknowledged that it had to consult potentially affected First Nations about the contracts, but K’omoks First Nation and Doig River First Nation claimed that BC Hydro should have consulted more deeply with them, given their ongoing treaty and land use negotiations with the province.
K’omoks First Nation claims aboriginal rights in the Salmon River watershed, where one of the projects, the Brewster Wind Farm, is to be located. The project consists of 30 wind turbines and a 35 km, 230 kilovolt (kV) transmission line. K’omoks has raised concerns about the effects on the local population of Roosevelt Elk, and claimed that BC Hydro “made no effort to contact K’ómoks or confirm with K’ómoks any of the information provided by Brewster Wind.”
BC Hydro acknowledged that it hadn’t consulted directly with First Nations, but had instead delegated this task to the bidders, claiming this would allow access to project information sooner than BC Hydro could provide it.
The decision
The BCUC decided that there had, in fact, been sufficient consultation with potentially affected First Nations, for three reasons.
First, the BCUC agreed with BC Hydro that the need for consultation at the current stage of the projects was low. This assessment is based on a 2004 Supreme Court of Canada case, Haida Nation versus British Columbia (Ministry of Forests), which set out a spectrum of consultation responsibilities from low (“notify and listen”) to high (“requirement of Aboriginal consent”).
The BCUC reasoned that since the electricity purchase contracts did not, in themselves, “permit the development of the projects nor the undertaking of any physical activity on the lands” (such as building access roads, removing trees etc.), then at this stage little consultation was required.
Second, given that the need for consultation was at the low end of the “Haida spectrum,” BC Hydro’s consultation activities were appropriate. In particular, BC Hydro was not wrong to delegate “procedural aspects” of the consultation to the project bidders, something confirmed in the Haida decision.
Finally, the bidders had consulted with potentially affected First Nations through mail, email, phone calls and meetings, and had been “generally responsive” to requests.
Assessment
Overall, the BCUC found that the ten contracts were in the public interest, and approved them. This presumably enables the successful bidders to obtain their project financing, since they now have 30 years’ guaranteed revenue from BC Hydro, providing they complete construction.
In many ways this is a positive step, since BC Hydro clearly needs the electricity – it has already initiated another call for power, this time looking for 5,000 GWh per year.
And looking at the narrow issue of how much the ten purchase agreements infringe on the claims or rights of First Nations, the decision looks reasonable – the contracts themselves don’t permit any physical activity. But if that’s the case, why did K’omoks First Nation and Doig River First Nation use this proceeding to air their grievances?
Original sins
The answer is that two of the usual opportunities for First Nations to assert their title rights had been taken away.
By the time the BCUC looks at an electricity purchase agreement, the facilities that produce the power should have had one and possibly two major approvals in place. The government has ensured that both were bypassed for the 2024 Call for Power projects.
First, new power plants in BC usually require a Certificate of Public Convenience and Necessity from the BCUC before they start construction. Utilities must demonstrate that they’ve done sufficient consultation, and the BCUC allows any First Nations with land title or claims to express their views.
Utilities also need to demonstrate that they’ve chosen the best alternative, and BC Hydro had alternatives – it selected its ten projects from 18 eligible bids. Maybe some of the eight rejected bid had fewer issues with First Nations’ rights. The BCUC review could have evaluated the trade-offs between alternative project proposals.
However, this review was never done. The government took advantage of a loophole created by the previous administration, whereby if the electricity is sold only to BC Hydro, a project doesn’t need a Certificate of Public Convenience and Necessity. This is despite the Minister of Energy saying in the legislature last year that the projects would have the “oversight” of the BCUC.
Second, onshore wind generation projects of 15 or more turbines would usually also be reviewed by the Environmental Assessment Office (EAO), after which ministers would decide whether to issue an environmental certificate. The evaluation allows First Nations to provide notice of their consent or lack thereof.
But it seems the government didn’t like the look of this either. Earlier this year it passed Bill 14, the Renewable Energy Projects (Streamlined Permitting) Act, and excluded the nine wind projects from the Environmental Assessment Act altogether (solar projects are not subject to the Act). The Doig River First Nation’s view is that this “essentially eliminates the standard of ecological and cultural management and protection” of its treaty rights.
Looking forward
There will indeed be future opportunities for First Nations consultation, as BC Hydro was at pains to point out. The projects each require “approximately eight to 12 federal permits and 20 to 25 provincial ones” for activities such as building access roads or constructing facilities, and the agencies doing this permitting have a duty to consult. But these permitting reviews will be limited to narrow questions, such as the best route for a construction access road.
Even the permitting process may be problematic. Another effect of Bill 14 was to move the responsibility for permitting these projects to the BC Energy Regulator (BCER), formerly the Oil and Gas Commission. While the BCER has overseen the province’s oil and gas industry for years, Doig River First Nation politely points out that it is “not equipped” to work on projects such as these, owing to lack of experience and expertise, and insufficient staff.
But bypassing the BCUC and EAO reviews didn’t just delay opportunities for First Nations’ involvement. The government effectively stifled the broader discussion of the projects as a whole, and the trade offs between them.
Unless BC Hydro or the government comes to some kind of arrangement with these First Nations pretty soon, I can see the permitting process being protracted and contentious.
Conclusion
We need more electricity if we are to expand and electrify our economy, and these ten projects will contribute to that. But I am also a firm believer in due process. Without sufficient review and consultation, essential projects like these will not attract public support.
The government might get away with skipping consultation on ten small projects in rural BC, but it will have bigger challenges in future. Our ever-growing demands for electricity will require more long-distance transmission lines and new large-scale generation, all of which will likely require some degree of consent from First Nations title claimants or holders. Imagine if it tried to build a dam in a provincial park with this attitude to consultation!
Our premier is reported to have said recently that “We’re committed to reconciliation [with First Nations]” as he explained that the government will appeal a recent BC Supreme Court decision which raised questions about the status of private land in the province.
If he was truly committed to reconciliation, he shouldn’t be denying First Nations their voice in approving new energy projects, as he did when he bypassed the BCUC and EOA reviews. He’ll need all the support he can get if he wants to achieve his electrification agenda.