On August 3, 2020, Powerex, BC Hydro’s electricity marketing subsidiary, publicly released a previously confidential “100% Clean Energy Standard Discussion Paper” dated October 2019. The proposal, submitted to the BC Government’s Phase 2 Comprehensive Review of BC Hydro, recommends that the government adopt a commitment to serve 100% of its annual demand with clean electricity. Powerex says this would help BC trade in the US market that increasingly favors premium-priced clean electricity products.
Powerex acknowledges that BC Hydro already has a long-term planning requirement that at least 93% of its electricity be generated by “clean or renewable” resources in BC. (In practice, BC Hydro’s generation is above 97% clean or renewable.) However, Powerex says an operational “100% clean energy” standard would be directly comparable with clean energy standards being adopted by US states.
Powerex says, “over just the past year four Western states have committed to meeting 100% of their loads with clean electricity by mid-century. Others are likely to follow. Building on the Province’s hydropower base, B.C. may be able to achieve such a standard much sooner than any other jurisdictions in the West. This would position the Province as a clear regional leader. In addition, the commitment would secure the Province’s competitive position when offering its surplus hydro capabilities to customers in these external jurisdictions.” Powerex notes that many of its US customers want a 100% clean energy product and are willing to pay a premium for it.
Powerex also calls for BC and California to align their GHG pricing mechanisms (i.e., BC’s carbon tax), toward a broader regional GHG pricing framework as additional states adopt carbon-pricing policies.
Powerex’s analysis seems to have been the stimulus for the government’s enthusiastic discussion in the Phase 2 Interim Report of expanding the role of electricity trading with the US, and it seems to underlie the “100% clean energy” provisions in Bill 17.
BCSEA certainly supports generation in BC being required to be clean. Selling BC clean electricity for premium clean prices would improve the economics of renewable energy. It would allow BC to obtain full value for the dispatchable capacity from its large hydroelectric facilities. We are also very interested in the idea of developing a regional market for clean energy as one tool to discourage the use of fossil fuels. We hope the coming months will bring answers to the many questions that would need to be addressed to assess the pros and cons of this direction. In the past, for example, US jurisdictions have been unwilling to recognize BC Hydro’s large-hydro power as ‘clean.’ How would that be addressed?
With Bill 17 on hold (see Bill 17 Stalled) there is more time for public consideration of these issues.