Megawatt: British Columbia Renewable Energy Law Blog : BC Renewable Energy Blog : Clark Wilson Law Firm : Green Power, Natural Energy

Recently, I ran across an excellent article in the Spring 2009 issue of Corporate Governance Quarterly called “Climate Change Disclosure Heats Up”. The authors, Patricia Koval, Tyson Dyck and Michael Pickersgill of Torys LLP, discuss public companies’ disclosures pertaining to the companies’ exposure to “climate risks”. This broad risk category includes matters such as: how climate change affects the company’s profitability, what opportunities / challenges climate change presents to the company, and what actions the company is taking in anticipation of the various climate change related regulations coming down the pipe (e.g. the anticipated mandatory cap-and-trade system on greenhouse gas emissions). 

The article contains a good review of Canadian public company disclosure requirements, and in particular the challenges created by the general requirement contained in National Instrument -51-102 Continuous Disclosure Obligations that requires issuers to disclose in their Management Discussion and Analysis filings (to borrow the paraphrasing from the article) “any known trends, demands, commitments, events or uncertainties that are reasonably likely to affect the issuer’s business or that management reasonably believes will materially affect the issuer’s future performance”. This obligation would likely impose a need to discuss the financial and operational impacts of environmental protection and climate change legislation on the issuer’s business, which may include such things as the recent legislation and proposed legislation in B.C. (see a summary of climate change legislation here), Ontario (see, for example the proposed Environmental Protection Amendment Act) and in the U.S. (see, for example the draft American Clean Energy and Security Act colloquially known as The Waxman-Markey Act) all, therefore, need to be taken to account. 
 

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Today, BC Hydro announced its plans to acquire a direct 1/3 ownership interest in Teck Resources owned 493 MW Waneta Dam for $825 million by signing a non-binding memorandum of understanding with Teck.

As the BC Hydro press release states, subject to due diligence and regulatory approval, the BC Hydro purchase will secure approximately 1,000 GWh of energy per year of firm energy for BC Hydro, or enough to power approximately 100,000 homes annually.  This energy, which is surplus to the needs of Teck's nearby smelter located in Trail, BC, has historically been sold on the open market, primarily to US buyers. 

"The agreement will go a long way towards helping us meet the B.C. Energy Plan goal of making the province electricity self-sufficient by 2016," said Blair Lekstrom, Minister of Energy, Mines and Petroleum Resources. "Equally important, this agreement will provide cost-effective energy from a publicly owned asset, helping to keep our province's electricity rates among the lowest in North America.

I don't know if this acquisition says more about Teck's need for cash or BC Hydro's need for more firm power, but at $825,000 per GWh, it is a rather expensive purchase for BC Hydro and a good deal for Teck. I wonder if BC Hydro will continue to sell it to US buyers through Powerex or keep the electrons here in BC. Bottom line - BC Hydro has more firm power to use or trade.

BTW - Megawatt is now on twitter

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In a previous post, I discussed the concept of carbon offsets and looked at the Pacific Carbon Trust in particular. The Trust is a new B.C. crown corporation that provides carbon emission offsets to businesses and government ministries. This week, the Megawatt spotlight is on Offsetters Clean Technology Inc. Offsetters is a B.C. based company and one of Canada’s leading offset providers. Notably, Offsetters was recently named the Official Carbon Offset Provider of the Vancouver 2010 Olympic and Paralympic Games.

Offsetters was founded in 2005 by two professors at the University of British Columbia. The company has created numerous carbon offset projects to date, many of which increased the energy efficiency of existing businesses and encouraged the introduction of more efficient energy systems. For example, one offset project was based on the use of a new biomass boiler to heat greenhouses, while another project involved the purchase of a ground-source heat pump system for an extended care facility. Offsetters states that these projects would not have been possible without funds from carbon offset purchasers.

One reason Offsetters focuses on energy efficiency projects, rather than forestry based carbon offsets, is that it claims the carbon reductions from energy efficiency undertakings are more easily verifiable. In particular, a representative from the company suggested that carbon offsets based on tree planting may be less successful because when the trees eventually decompose, they release stored carbon back into the atmosphere. Offsetters insures that all carbon emission reductions from its projects are independently verified by a qualified engineering firm.

In addition to the Vancouver Olympic Organizing Committee, Offsetters has already assembled an impressive list of clients. These include Vancity Capital, Bunting Coady Architects and Avison Young Real Estate Solutions, to name just a few. Offsetters also partners with West Jet and Air France to provide free carbon offsets to airline passengers. Patrons of either company may elect to have the carbon emissions from their flight offset by the airline at no cost to themselves.

Megawatt will keep you posted on new developments in the world of carbon offsets and other climate change solutions.

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• Smart Grids
• Plug-in Hybrid electric charging infrastructure
• efficient systems which facilitate intermittent renewable power and heat
• utility scale storage systems
• heat pump with natural refrigerants and supply of renewable energy
• efficient hybrid systems combining renewable or waste energy with limited fossil fuel input for remote communities
• geothermal or waste heat sources upgraded for power and and heat for communities
• wind energy technologies that address Canadian challenges (ie cold climate, remote communities, offshore application and grid integration)
• marine energy
• low head hydro
• solar thermal and PV systems

The good news is that the Government of Canada has again recognized the importance of renewables and the need to meet the diverse demands of the country. The bad news is that there is a lot more money being diverted to cleaning up the pollution, rather than replacing the pollutters altogether.

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The British Columbia Government’s Climate Action Plan will soon be providing new opportunities to organizations and entrepreneurs interested in undertaking environmental “carbon offset” projects. Carbon offsets are projects that reduce the amount of carbon in the atmosphere in order to counteract global warming. The economic concept behind carbon offsets is that businesses and organizations purchase “carbon credits” generated by the projects to cancel out their own carbon emissions. Businesses usually purchase carbon credits in order to improve public relations or meet regulatory standards.

The Provincial Government created the Pacific Carbon Trust  as a crown corporation to facilitate the carbon offset aspect of its Green Economy Initiative. In particular, the Trust was created to serve the needs of British Columbia Government ministries, all of which will be required to offset their carbon emission by 2010 under the Greenhouse Gas Reductions Targets Act. The Trust will purchase carbon credits from private suppliers and then sell them to government ministries and businesses.

The Trust recently asked potential carbon offset suppliers to provide information on the kinds of projects they would create and market to the Trust. The Trust expressed particularly strong interest in forestry projects that aim to offset carbon emissions by increasing tree density. All offset projects marketed to the Trust must be based in British Columbia. The Trust plans to purchase carbon credits from offset suppliers by the end of 2009 and will publish a detailed guide on how to submit project proposals to the Trust in July.

Stay tuned to the Megawatt blog for more on the Pacific Carbon Trust and other carbon offset opportunities.  

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The University of Northern British Columbia, located in Prince George, BC has selected Vancouver based, Nexterra Energy Corp. to supply and install a turnkey biomass gasification system to heat UNBC's campus and anchor its new Northern Bioenergy Innovation Centre.

According to the press release issued last week, Nexterra's system is part of a $14.8 million bioenergy program that includes upgraded road and utility infrastructure, a new building and a "living laboratory" for bioenergy research and development. The Nexterra gasification system will convert locally-sourced wood residue into clean-burning "syngas" that will displace up to 85% of the natural gas currently used to heat the campus. The project, which is jointly funded by the federal and provincial governments, is expected to begin in June 2009. It will be complete by mid 2010 and construction will support approximately 150 jobs.

By using wood residue to displace natural gas, UNBC will reduce its fossil fuel consumption by 80,000 GJ/year, the equivalent of natural gas required to heat over 700 homes in B.C. The new system will also reduce the university's carbon footprint by approximately 3,500 tonnes annually, the equivalent of taking 1,000 cars off the road.

This is a great story about the future of British Columbia. Here we have a BC based company supplying its homegrown green energy technology to a BC university, with the fuel for the plant coming from the local forest industry. I call this a win-win for the people of Prince George and the Province of British Columbia.  Not only will Nexterra's system help provide a much needed market for local forest waste and foster further research and innovation in the growing renewable energy sector, UNBC's decision to replace natural gas with biofuel to heat its campus will also contribute in the critical fight against climate change.

The way I see it, when there are viable non-GHG emitting alternatives to traditional sources of energy, let's just simply use them. UNBC's initiative is just another example of fresh forward thinking, something we all expect out of an institution of higher learning.

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The world's favourite search engine and green energy proponent has just launched the Google PowerMeter, a Google gadget that can show consumers their personal electricity consumption right on a home or work computer. Relying on installed "smart meters" as a data source, customers will soon be able to simply log-in from home, work or wherever and check out their home's electricity use. It will also be possible to link through iGoogle, if you are so inclined.

To date, only 8 utilities have signed up with Google to participate in the PowerMeter program, with many more expected. In Canada, only Toronto Hydro has partnered with Google on this initiative, where 600,000 residential smart meters have already been installed. Here is the Toronto Star's story on the subject. Initially, only 1,000 Torontonians will have access, but nevertheless, it appears to be a great energy management device which will most certainly gain more users.

It is the little things like this (and macro-measures like peak time electricity pricing) where people will learn to appreciate their daily electricity footprint and the costs associated with that usage. And once people understand and see that, only then will conservation reach the tipping point and lead to measurable changes in our overall electricity use. So well done Google - this is very cool. I knew we could count on you for something innovative like this.

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The Globe and Mail reported that the U.S. Federal Energy Regulatory Commission (FERC) today approved a funding arrangement for the construction of a major transmission line that will cross into the United States from Quebec to become part of the U.S. energy grid.  FERC has even agreed to exclude the cost of the 1,200 MW transmission line from the rates charged to consumers.

Essentially, this means that FERC has, for the first time, recognized Hydro-Québec's hydroelectricity as a "clean" source of energy, meaning Quebec can now participate in the Obama clean energy policy and help New England move away from gas-fired power.

This new development certainly helps British Columbia's prospects in exporting electricity to the California market. Now, all BC has to do is woo the Californians.

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The written arguments are now in and and only the final oral hearing remains (scheduled for June 1, 9am at the BCUC in Vancouver) in the matter of BC Hydro's 2008 Long Term Acquisition Plan (LTAP).  BC Hydro and an incredible 13 intervenors submitted written arguments to the BCUC in what has been a very thorough and hotly contested examination of the future of electricity generation in this province. If you are interested in reading the arguments, you can access all of them here, through the BCUC's excellent website.

June 2 Update: To view the BCUC transcripts from the June 1 Oral Phase, click here and go to the bottom of the page and click on "Transcript Volume 16 Oral Phase June 1, 2009".

With the 2008 LTAP, the BCUC faces one of its most important decisions in recent memory. To the renewable energy industry in BC and the 68 proponents who bid 17,000 GWh's per year bid in to the Clean Call for Power, its decision whether to approve BC Hydro's request for a pre-attrition target of 3,000 GWh/year from last year's CPC is absolutely critical.  The breadth of the next series of renewable power generation depends on it.

BC Hydro's 3,000 GW/h request has been mired in controversy after the lunacy late last year. BC Hydro, for its part, is holding firm on the 3,000 GWh/year, while IPPBC and Nai Kun Wind Energy Group Inc. each presented arguments against this revised call volume. Of note, Nai Kun, went so far as to argue a pre-attrition CPC volume of 9,000 GWh/year.  The thing is, there is plenty of opportunity out there to fill that volume, and BC Hydro's DSM's program success is hard to measure, so I just wonder if the BCUC will reject BC Hydro's reasons for reducing the CPC volume on the basis of short-sightedness or whatever, or if it will simply acquiesce.  It's in their hands.

The BCUC's final decision on the 2008 LTAP is expected in late-June.  An entire industry and millions of investment dollars await, on pins and needles.....

June 30 @ 5pm Update: OK, so the end of June was not to be. I'll go on the record as saying a decision on the 2008 LTAP is expected anytime. 

The LTAP decision drives the clean call and helps shape the Section 5 Inquiry. We are all waiting for the LTAP decision.

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