VICTORIA — The Site C hydroelectric dam will be completed with the backing of British Columbia’s NDP government, but it is warning the price tag will be higher than estimated.
Site C was projected to cost $8.3 billion to complete, but the government now estimates the project will total $10.7 billion.
“Megaproject mismanagement by the old government has left B.C. in a terrible situation,” Premier John Horgan said Monday in a news release. “But we cannot punish British Columbians for those mistakes, and we can’t change the past. We can only make the best decision for the future.”
An estimated $4 billion has been spent so far on the dam and the NDP government was debating whether to continue construction or cancel the work midway through the job.
The financial impact of cancelling the project on ratepayers and B.C.’s bottom line were the major factors in the government’s decision to proceed rather than cancel.
The government says the province risked a credit downgrade and debt-servicing costs of up to $150 million annually if the project was cancelled and the treasury absorbed the $4 billion loss.
The B.C. Utilities Commission, the province’s independent energy regulator, concluded in its assessment released last month that the dam is over budget and behind schedule.
“It’s clear that Site C should never have been started. But to cancel it would add billions to the province’s debt, putting at risk our ability to deliver housing, child care, schools and hospitals for families across B.C. And that’s a price we’re not willing to pay,” said Horgan.
The decision on the project’s future is one of the first major decisions that faced the minority NDP government.
The massive hydroelectric project has been at the centre of a polarized debate between politicians, environmentalists, First Nations, labour groups and landowners in the Peace River Valley.
Former premier Christy Clark gave Site C the green light in December 2014, saying the decision to approve the province’s most expensive megaproject marked a historic milestone that would be felt for a century.
Site C has been part of the province’s hydroelectric generation plans since 1958.
It will be the third dam on the Peace River in northeastern B.C., flooding an 83-kilometre stretch of valley near Fort St. John. It will provide enough power to light up to 450,000 homes a year.
B.C. Hydro’s environmental impact statement forecasted flooding of more than 5,550 hectares of land, of which at least 3,800 hectares is agricultural. Site C would also flood Indigenous heritage sites and force up to 20 families, many lifelong ranchers, to move.
Construction started in July 2015, but one of the Horgan government’s first moves was to send the project to a review by the utilities commission.
The commission was asked to confirm whether Crown-owned BC Hydro is on target to complete construction on budget and by 2024. It was also asked to provide advice on three possible outcomes: proceeding with the project, suspending construction until 2024 or terminating it.
Dirk Meissner, The Canadian Press