The report on the Site C dam project is in, and if Premier John Horgan was hoping for an easy way out of a painful dilemma, he didn’t get it. The B.C. Utilities Commission, which had been shut out of important decisions by the previous B.C. Liberal government, investigated the dam, but did not give a judgment on whether it’s better to continue or cancel the project. The government will have to make that call.
The commission found the construction is not on schedule. More importantly, no matter which option the province chooses, it will cost billions of dollars.
The government now has to dive into the report and figure out what to do — and it wants to have an answer by the end of the year.
Minister of Energy, Mines and Petroleum Resources Michelle Mungall said: “This will be an extremely difficult decision.”
She has that right.
The decision on Site C is likely to be the hardest one Horgan’s government will face, at least in its inaugural term. Shut down construction and it will put more than 2,000 people out of work, and open the party to accusations of pouring money down the drain. Keep Site C going, and the government alienates environmentalists, area residents, First Nations and the B.C. Green Party.
It’s likely that the workers who face layoffs are not NDP voters, although unionized labour was once the party’s mainstay. Today, its constituency is more the environmental wing of the party, and it can’t forget its commitments to improving relations with First Nations. Nor can Horgan afford to ignore the three Green Party MLAs who prop up his government and who are against the dam.
While the utilities commission lays out a lot of the numbers, it doesn’t give Horgan any easy answers. There is no political cover for any decision, as all the options are bad in one way or another.
If construction continues, the commission doubts it will be completed by the November 2024 target date and says the cost will rise from the proposed budget of $8.335 billion to more than $10 billion. Overruns could be 20 to 50 per cent above the budgeted cost, the panel says.
Suspending and restarting the project is “the least attractive of the three scenarios,” the report says, because it would add at least $3.6 billion to the final cost, and would risk further delays because environmental permits would expire. Mungall quickly ruled out that option.
Halting construction and scrapping the project would add $1.8 billion to the $2 billion that will have been spent by the end of the year. That doesn’t include the cost of finding new sources to make up for the power that Site C would have generated.
Significantly, the report says: “The panel believes increasingly viable alternative energy sources such as wind, geothermal and industrial curtailment could provide similar benefits to ratepayers as the Site C project with an equal or lower unit energy cost.”
That opinion is important and would have been valuable before the whole project started, because others with less gravitas than the commission have been making the same argument. However, now that B.C. Hydro has sunk billions of our dollars into the dam, the government can’t start from zero with wind or geothermal. It has to take into account the money already spent.
Any way they add up the numbers, Horgan and his ministers have all the facts they are likely to get. This decision, however, isn’t about facts — it’s about values and politics.
