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Not-so-neighborly Alberta and British Columbia lock horns over issues of pipeline access to Pacific Coast and BC hopes of selling surplus power GARY PARK For Petroleum News
The simmering showdown between Canada’s two most western provinces over energy megaprojects is coming to the boil, with British Columbia trying to sell surplus hydroelectric power to its neighbor and Alberta Premier Rachel Notley spurning the offer unless British Columbia allows construction of an oil pipeline across its territory to the Pacific Coast.
“We’re not necessarily going to have that much demand for that much electricity if we can’t find someone to sell our product to,” Notley told reporters.
“We have to get our product to other markets.”
She said that if provinces such as British Columbia and Manitoba want to talk about power lines crossing provincial borders they need to understand that is no different from Alberta’s efforts to get support for its desperate efforts to get crude pipelines built to export terminals.
There was an even more direct statement by Alberta Energy Minister Marg McCuaig-Boyd, who said her government would “do what’s best for Albertans and Alberta’s economy. We won’t be buying more power if we can’t get our resources to market.”
Different views British Columbia Energy Minister Bill Bennett said he did not have a problem with Alberta linking a potential power deal to pipeline support.
“We have a long, very positive history of cooperating with Alberta, so I don’t see this as a big problem. I think we can work through this and find a way to do business together,” he said.
Bennett said British Columbians mostly want to ensure that that any pipelines carrying heavy crude are built to the highest standards, based on the five conditions it has set to protect land, air and sea.
Successive Alberta governments have a different view of that relationship, having spent much of the last decade trying to get British Columbia to sign off on Enbridge’s Northern Gateway and Kinder Morgan’s plans to triple capacity of its Trans Mountain system, both designed to get oil sands bitumen to Asian markets.
The gulf between the two provinces was reflected in a new poll by the Angus Reid Institute which showed 60 percent of British Columbians oppose the Trans Mountain project, while 80 percent of Albertans support the proposal.
“It’s a tale of two neighbors with very little in common,” said Shachi Kuri, executive director of Vancouver-based Angus Reid.
In the midst of the cross-border push-and-shove, British Columbia Premier Christy Clark is seeking C$1 billion in federal money to upgrade British Columbia Hydro transmission lines to support electricity shipments to Alberta.
She said “it’s great” Alberta has “finally” decided to phase out coal-fired electricity plants, adding “we can help them with energy so they can find a way to shut those coal plants.”
But Clark showed little understanding that Alberta already has access to its own sources of clean power - wind, solar and natural gas.
For Clark there is pressure to strike a deal with Alberta now that construction is underway on the Site C hydroelectric dam in northeastern British Columbia - a C$9 billion project with capacity of 1100 megawatts that was partly designed to support exploration, production and transportation of gas for LNG plants on the Pacific Coast.
How much, if any of the Site C power will be needed for LNG is now a matter of doubt as projects hang by the slenderest of threads, leaving British Columbia with the prospect of a vast surplus, including an existing transmission line into Alberta that is already underutilized.
Call to define benefits Scott Thon, chief executive officer of Alberta’s largest electricity transmission provider and chairman of the Canadian Electricity Association, told the Financial Post that Clark’s plan fails to establish the benefits of her scheme to Alberta consumers.
“What we need first is to define the benefit, then we can talk about what we need to capture the benefits, versus saying ‘Let’s go and build something and hope there are benefits.’”
British Columbia government officials have issued estimates that a hydro link would eliminate up to 6 million metric tons of carbon emissions, underpinning the province’s target for reducing its carbon output.
George Heyman, an opposition member of the British Columbia legislature, said Clark is pushing the idea mostly to justify Site C, adding “she’s locked into the project and is trying to convince people there’s a market for the power.”
British Columbia Chamber of Commerce President Jon Garson lifted the curtain on the cross-border tensions by urging the governments to ensure political rhetoric does not interfere with enhancing trade and building both economies.
He said political squabbling will only generate a “lot of bad blood that will get in the way of people doing business.”
Bennett insisted British Columbia’s pipeline conditions are “not unreasonable ... they manifest exactly the same values that Albertans have and I think we can work through that together,” acknowledging that the export of raw materials benefits all of Canada.
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