Mixed signals from BC government

CANADA: The wind industry has welcomed British Columbia's plan to use clean energy to power its fledgling liquefied natural gas (LNG) sector. But the government's decision to soften its electricity self-sufficiency goals has left wind-energy producers wondering how much incremental growth in demand will emerge over the next few years.

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The industry will likely have to wait until BC Hydro's new integrated resource plan is released at the end of this year to see how new power purchases fit into the equation.

"Our expectation is that it would very likely lead to a new call for power at the end of 2013," said Nicholas Heap, BC policy manager for the Canadian Wind Energy Association (CANWEA).

BC's burgeoning shale-gas industry has prompted companies in that sector to look to lucrative Asian markets to sell their product. Three LNG terminals are on the drawing board for completion by 2020, with the first expected to start construction this year.

The plants require huge amounts of energy to cool the gas to -160degC so it can be shipped overseas. BC's new strategy says that at least the first two terminals will access clean electricity from the province's power grid.

While the plan is encouraging, said Heap, it falls short of the aggressive electrification strategy CANWEA has been pushing for. The body commissioned a study late last year that found new industrial demand could hit nearly 12TWh in 2017 and 24GWh by 2025.

BC's new strategy only deals with part of that growth, leaving out how the skyrocketing energy needs of shale-gas production facilities, planned new mines and proposed plants to produce alternative transportation fuels will be met.

Connecting all of these new industrial facilities to the grid could help drive BC's installed wind capacity from the current 248MW to 5.25GW by 2025, CANWEA argues."Is the government seizing the opportunity? We haven't seen it," said Heap.

Policy U-turn

The province's decision to change the rules governing how BC Hydro procures new electricity supply could also mute demand for new wind in the province. The utility had been under an order to secure enough in-province generation by 2016 to cover domestic needs even in "critical water" years when inflows into hydroelectric reservoirs are low, plus have a 3TWh-a-year insurance buffer by 2020.

Under the new policy, the utility only has to have enough power to supply BC demand in an "average water" year, making up any shortfall with imported electricity. "The move to average water will result in less long-term commitments to purchasing power," the government said.

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