H E R T Z O G

Natural Gas Prices and BC Hydro's Energy Policy

CBC Radio, October 6, 2001

First it was gas for our cars, now it's gas for our homes. What's happening? Why is the price of natural gas, which we have in abundance in British Columbia and Alberta, taking off like a helium-filled balloon escaping from a child's hand after a party?

In the past 18 months, the price of natural gas in BC has soared by nearly 70%. And there's more bad news ahead: this winter, the price of natural gas could go up by another 20%.

“ In the past 18 months, the price of natural gas in BC has soared by nearly 70%. And there's more bad news ahead: this winter, the price of natural gas could go up by another 20%.”

BC's new minister of Energy, Glenn Robertson, recently announced that the provincial government would not be mailing a home heating rebate to BC households, as Premier Klein is doing in Alberta. "The price of gas is a market phenomenon," claimed Robertson. "It has nothing to do with the BC government."

Our new Energy minister couldn't be further from the truth. In fact, the BC government's energy policy is part of the problem.

The government wants all new electricity to come from burning BC gas in combined-cycle gas turbines: huge jet engines on pedestals. Never mind the extra air and noise pollution that will be inflicted on local communities, or the mind-boggling amounts of global-warming carbon dioxide that will be released into the atmosphere.

We must burn BC natural gas to satisfy our growing need for energy, and to make sure there's surplus electricity for sale to the power-hungry California market, says our government.

Far from protecting businesses and home-owners, this NDP energy policy is going to make things even worse. If BC Hydro goes ahead with its GSX natural gas pipeline crossing to Vancouver Island, and builds the associated on-Island generating plants, this time next year we could be watching our electricity bills going through the roof, in hot pursuit of our natural gas bills.

In the past decade, American and Canadian utilities have been frantically building gas turbine plants to generate electricity for sale to the newly-integrated North American electricity market, snapping up natural gas supplies to fuel their hungry beasts. That's what the Sumas II project is all about. Just across the border from Abbotsford, it's a merchant plant for the California market, or wherever else the power can be sold.

“ The government wants all new electricity to come from burning BC gas in combined-cycle gas turbines: huge jet engines on pedestals. Never mind the extra air and noise pollution that will be inflicted on local communities, or the mind-boggling amounts of global-warming carbon dioxide that will be released into the atmosphere.”

With every North American electricity utility grabbing for the same gas ring, there has been intense upward pressure on both natural gas prices and equipment costs. The result is that natural gas isn't cheap any more, nor is the electricity produced by these plants.

BC Hydro is coming late into the game, and we are about to be sucked into the same financial black hole that is gobbling up gas consumers in Alberta and Ontario - increased gas prices, followed by rising electricity costs. We will all have to pay for this foolishness.

Instead of this disastrous energy policy, we should be focusing on the very real and attainable alternatives, such as energy efficiency, load-shifting, and demand management, as well as traditional "green energy" sources such as solar, wind, small hydro, wave power, and geothermal energy.

But to do that would require a government with vision, capable of looking further than the next budget and the next election. But the BC government's energy policy is all about grabbing money, about balancing the books for one more, last-chance, pre-election budget. It's all about getting re-elected.... It's all about power.

But it's not the clean, sustainable power that we really need.

For Commentary, I'm Stuart Hertzog, in Victoria.