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A construction work crew at the East Toba Creek Plutonic Power Corp. project at East Toba River B.C. 2002 and the governing B.C. Liberals claim they are little more than an opposition-B.C. NDP splinter group. However, they do purport to pro- mote public power in B.C., something that has kept costs low for generations. Groups like B.C. Citizens for Public Power say that by paying private companies higher rates than electricity customers now pay for tradition- ally cheap hydro, the government is playing into Consultations with native groups were key to getting them to sign onto the project, says Paquin. One example found that, in preparing the proposal, the company realized the community had major concerns with the amount of water required from nearby rivers, which prompted it to propose a $4-million added investment in condensers. "If we didn't do this together, it was a non-starter," says Paquin. "So when you talk about accommo- dation and consultation, you have to accommodate the interests of the people on that basis." So far, the company has submitted two proposals to BC Hydro through a separate bioenergy call in June. In a Decem- ber announcement of winning bids, the company wasn't on the list of successful applicants. But Paquin says the company is still hoping to be on the list when the power utility chooses another set of winners in phase two of the process. Already, investors have sunk about $2 million into developing the proposal for what would be a more than $200-million project. In 2008, those numbers sent Paquin and his business partners into the arms of Run of River Power, a public company that already has a small hydro project earning revenue with several more in the works. It's those upfront costs that can make getting into the busi- ness a risky proposition in B.C. As Antanavicius points out, many European countries reduce that uncertainty by guaran- teeing companies that produce green power the ability to sell into the grid. In Canada, provinces such as B.C. and Ontario have so-called standing-offer programs that offer similar guar- antees. But in Ontario's case, regulators are still working out the details, says Adam Chamberlain, the national leader for the cli- mate change group at Borden Ladner Gervais LLP in Toronto. BC Hydro, meanwhile, pays a lower price under the standing- offer program than what many companies are likely bidding under the clean-power call, Antanavicius points out. The biggest challenge on the West Coast, however, appears to be politics. While run-of-river proponents claim to be green, some environmental groups argue that by diverting waterways through a pipe for power generation, the small-scale hydro projects destroy fish habitat. One such project was the Pitt River power project. The public outcry from environmental groups led B.C.'s Environment Minister Barry Penner to a highly public cancellation of the project in March 2008. Another project being discussed further up the Pitt River has met the ire of B.C. Citizens for Public Power, a group that de- cries any private power production. The group was formed in the hands of big business. The fear, they add, is private business will end up exporting power to power-starved jurisdictions like California, leaving local customers paying escalating rates for electricity. Antanavicius admits exporting wind power would be an op- tion, particularly since electricity demand is lowest in B.C. in the summer, a time when Californians blasting their air condi- tioners create a surge in consumption. But proponents of pri- vate power say higher electricity rates are inevitable regardless of who builds new generation, particularly since demand is ris- ing in the province at the same time as BC Hydro's existing dam projects, many of which date back to the 1960s, age. "Come on people, wake up," says Paquin. "We need more power. That power is not going to be built at 1960 prices. It's going to cost that much more. It's inevitable that it's more ex- pensive." Vickers, of B.C. Citizens for Green Power, argues that BC Hydro, after letting years go by without building new generation projects, doesn't have the ability to develop small-scale electri- cal facilities. "Quite frankly, we need them," he says, referring to private power companies. Much of the opposition to the new power players, he notes, comes from labour groups such as the Canadian Office and Pro- fessional Employees Union Local 378, which represents workers at BC Hydro. Labour, of course, has links to the provincial NDP, which itself has been skeptical of the clean-power process. In a recent press release and in public comments, the NDP has said it would impose a moratorium on new private power projects. "What we have said is that we'd go back to using BC Hydro to generate power," the party's web site quotes leader Carole James as saying. At the same time, the NDP says it's not ruling out partnerships between the public utility and private producers. As a result, Legge feels the upcoming provincial election in May represents the biggest threat to independent power producers, particularly as the current B.C. Liberal government, which has embraced the sector, struggles in the polls. "The potential for British Columbia to be a major player in energy and electricity is huge," he says, noting the movement towards electric cars will only bolster demand. "But if the NDP get elected, I think the future in British Columbia for IPPs could be quite gloomy for a while. I think IPPs could start looking elsewhere because there are a lot of other areas within North America where IPPs are welcome with open arms." IH INHOUSE FEBRUARY 2009 • 23