Research BC Energy system

Final Research Update from Vancouver

The 30th of September I left Vancouver with mixed feelings. My visa was about to expire and the time had come for me to finish what I originally came for, my master studies. I must admit, leaving behind a place which I enjoyed and loved for the past six months was not easy but home was awaiting me. I have experienced Canada as a place which is truly majestic due to its phenomenal nature and cultural diversity. Vancouver and British Columbia will always have a special place in my heart and I'm confident I will one day return there. Anyhow, there's an end to every beginning and a new chapter with opportunities opening for me. Nearly two weeks ago I finished my research and master thesis and noticed it had been a while since my last research update for the ACSN. My knowledge of BC's energy sector has grown significantly since then and it was therefore time for a new update to share with you my research observations on BC's energy system.

It goes without saying that BC's energy system is one which many other countries, provinces and regions envy. The favourable natural conditions of BC enabled the province to achieve a very high percentage - 93% - of clean and renewable electricity. This achievement was initially reached due to the nationalization of the energy system and the construction of several large hydro electrical dams. However good this system might be, it has its own unique flaws, threats and shortcomings, which I tried to identify and explore in my research. Several macro scale developments, actor activities and policy documents are jeopardizing British Columbia's renowned clean status quo and 93% clean electricity benchmark. The government's perception that BC's clean energy sector is the economy's main driver no longer prevails and the political agenda has shifted towards stimulating developments of the Liquefied Natural Gas (LNG) sector. Macro scale developments like the North-American shale gas revolution has increased the competitiveness of gas as an energy source and economic driver. Consequently LNG has been identified by BC's policy makers as one of the main potential economic drivers. This economic potential is mainly due to the products' export opportunities to countries like China and Japan. The increases in energy demand from a fast industrial developing country like China and Japan's surge for power are accountable for this. The 2012 tsunami has created an enormous gap between Japan's energy supply and demand forcing the country into importing vast amounts of energy resources to fill the gap. Additionally BC is also facing a high increase in population growth - from 4.6 mil now to 5.7 mil in 2020 - and an increase in electricity intensive industrial activities from the mining & LNG sector. As a result BC is facing an increase in total energy demand whilst no new electricity production - supply - sites are planned over a short time period. New electricity is needed, that's evident and also acknowledged by BC Hydro, the question however is where this supply of new electricity should come from? Will this be derived from fossil fuels or new clean energy projects?

These macro scale developments and the inconsistency in BC's - clean - energy policy result in uncertainties and bring several threats to BC's clean energy sector. Uncertainties in the sector are lethal for the development of new clean energy projects due to the fact that these projects are characterized by their high initial investment costs. They are capital intensive projects and therefore depended on investors to bring in capital. The uncertainties however lead to a higher risk for the involved investors and can eventually result in less willing to take the risk.

The BC government and BC Hydro - BC's only energy utility - are the regime of BC's energy system. They control and influence the sector and market through the writing of policy and legislation. They are mainly responsible and should therefore act accordingly to these macro scale developments and resulting threats by designing a long term energy strategy that brings certainty, consistency and trust to the clean energy sector. My research document summarizes these developments and threats to offer some practical and important insights into the possibilities and opportunities in maintaining a strong clean energy sector and the 93% benchmark. How the exact content of this strategy should look like? I don't know but having an ambiguous policy will certainly not help BC in maintaining its renowned clean status quo. The developments of the LNG sector will indisputably provide the province with a resource based revenue stream but might leave little room for other new renewable energy developments. The BC government should therefore ask themselves if choosing for another short-term orientated solution which exploits BC's natural resources and increases its dependency on them rather than creating a long-term orientated sustainable strategy is the right way to go.

If you are interested in this particular subject and want more information about my research you can contact me on the following e-mail address: tom.vd.meulen(at)hotmail.com. Thank you for reading my research updates and I would like to thank and acknowledge the ACSN for the awarded scholarship. It has been a pleasure doing research on such an exciting and complex subject.