[ Page 4057 ]

CONTENTS

Routine Proceedings

Insurance (Motor Vehicle) Amendment Act –– 1980 (Bill 24). Committee stage.

Third reading –– 4057

Revised Statutes Correction Act (No. 2), 1980 (Bill 61). Second reading,

Hon. Mr. Williams, –– 4057

Attorney-General Statutes Amendment Act, 1980 (Bill 55). Second reading.

Hon. Mr. Williams –– 4057

Mr. Macdonald –– 4057

Hon. Mr. Williams –– 4057

Municipalities Enabling and Validating Amendment Act –– 1980 (Bill 48). Second reading.

Hon. Mr. Vander Zalm –– 4058

Mr. Howard –– 4058

Hon. Mr. Vander Zalm –– 4058

British Columbia Place Act (Bill 46). Second reading.

Hon. Mr. Rogers –– 4058

Mr. Macdonald –– 4058

Mr. Cocke –– 4059

Mr. Howard –– 4060

Hon. Mr. Rogers –– 4061

Division on second reading –– 4061

Mineral Amendment Act, 1980 (Bill 62). Second reading.

Hon. Mr. McClelland –– 4061

Mr. Howard –– 4062

Hon. Mr. McClelland –– 4062

Utilities Commission Act (Bill 52). Second reading.

Hon. Mr. McClelland –– 4062

Mr. Skelly –– 4063

Mr. Davis –– 4066

WEDNESDAY, AUGUST 20, 1980

The House met at 10 a.m.

[Mr. Davidson in the chair]

Prayers.

MR. REE: Mr. Speaker, it's always a pleasure when constituents visit the House in Victoria. Today in the gallery are Mr. Don Murray, his wife Rosalynn, and their children Karen and Colin, a family from North Vancouver. I'd ask the House to welcome them to the assembly and to Victoria.

HON. MR. McCLELLAND: I'd like to ask leave to table documents I referred to in debate on a bill yesterday.

Leave granted.

Orders of the Day

HON. MR. GARDOM: Mr. Speaker, I understand that it is desired that the public accounts committee sit this morning. I therefore ask leave to make a motion to permit that to happen.

Leave granted.

HON. MR. GARDOM: I move that the Public Accounts committee be permitted to sit during the morning session of the Legislature.

Motion approved.

HON. MR. GARDOM: With leave, I proceed to public bills and orders.

Leave granted

HON. MR. GARDOM: Committee on Bill 24, Mr. Speaker.

INSURANCE (MOTOR VEHICLE)
AMENDMENT ACT, 1980

The House in committee on Bill 24; Mr. Strachan in the chair.

Sections 1 to 11 inclusive approved.

Title approved.

HON. MR. HEWITT: Mr. Chairman, I move the committee rise and report the bill complete without amendment.

Motion approved.

The House resumed; Mr. Davidson in the chair.

Bill 24, Insurance (Motor Vehicle) Amendment Act, 1980, reported complete without amendment, read a third time and passed.

HON. MR. GARDOM: Second reading of Bill 61, Mr. Speaker.

REVISED STATUTES
CORRECTION ACT (NO. 2), 1980

HON. MR. WILLIAMS: Mr. Speaker, this second correction act was necessary in order to complete the clerical and other non-substantive changes in the revised statutes flowing from the tremendous work that was involved in the revision.

I believe that if the members have any questions with respect to the legislation they can more appropriately be dealt with at the committee stage, when section by section I will be able to respond to concerns.

I move second reading.

Motion approved.

Bill 61, Revised Statutes Correction Act (No. 2) 1980, read a second time and referred to a Committee of the Whole House for consideration at the next sitting of the House after today.

HON. MR. GARDOM: Second reading of Bill 55, Mr. Speaker.

ATTORNEY-GENERAL STATUTES
AMENDMENT ACT, 1980

HON. MR. WILLIAMS: Mr. Speaker, the number of statutes which fall under the administration of the Attorney-General is such that from time to time each year it has been found desirable to make minor statutory changes through a miscellaneous statutes amendment act. This one is no different. Again, while I'm not suggesting that some of the amendments are not significant, I think it would be more valuable to the members if they were dealt with in committee.

I move second reading.

[Mr. Strachan in the chair.]

MR. MACDONALD: Mr. Speaker, I agree that this bill might be better considered in committee. I just want to refer to one matter of importance in it. The right of the benchers is improved in that they can now, as if they were a court of law, fine a barrister up to $10,000, without any power to impose incarceration. The reason I refer to that is that I think it's a good amendment. I think it's necessary for a profession to have that disciplinary power over its members, but a fine of $10,000 is a pretty big exercise of public power. So the lawyers association is no longer a private body; it's a quasi-public institution. The other day the Attorney-General spoke in terms of being generally in favour of the principle that there should be public representation among the benchers of the Law Society of British Columbia. I just want to say that I second that view. When these kinds of extraordinary but necessary powers are being given to a private body, we must be sure that it is representative and responsive to the whole community.

DEPUTY SPEAKER: The minister closes debate.

HON. MR. WILLIAMS: I thank the second member for Vancouver East (Mr. MacDonald) for his indication Of support. As he is very well aware, other professions have the power to impose fines without limit — chartered accountants

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for one. There is no limit in their statute, Mr. Member, as you well know.

May I just say that I announced to the press, during the course of my estimates, that I'd be meeting with the representatives of the benchers about September 1; the meeting, in fact, is on September 3. The matter raised by the member will be dealt with at that time.

I move second reading.

Motion approved.

Bill 55, Attorney General Statutes Amendment Act, 1980, read a second time and referred to a Committee of the Whole House for consideration at the next sitting of the House after today.

HON. MR. GARDOM: Second reading of Bill 48, Mr. Speaker.

MUNICIPALITIES ENABLING AND
VALIDATING AMENDMENT ACT, 1980

HON. MR. VANDER ZALM: Mr. Speaker, this act eliminates the unnecessary documentation and delays in obtaining land use approvals in designated floodplain areas in the lower mainland. The amendment will provide a means of eliminating unnecessary red tape and delays in obtaining land use approvals. Previously any amendment to an official planned bylaw or zoning bylaw or the issuance of a development permit was subject to my approval where the lands concerned were within the floodplain as defined in the lower mainland regional plan. The amendment would permit me, by regulation, to define areas and circumstances where such approval would not be required. In some areas, where it has been determined by the adoption of community plans or by agreement with the Ministry of Environment that development may take place, individual approvals would not be required. This amendment act also identifies two new areas for the installation of a system of sewers in the district of Richmond.

Mr. Speaker, I move second reading.

MR. HOWARD: The first member for Victoria (Mr. Barber), who is the spokesperson with respect to municipal affairs, is also a member of the public accounts committee and is currently meeting in that committee. He advised me — in fact, an advice bordering on instruction — to indicate to the House that I could say on his behalf that we look favourably upon this particular bill, but that the minister should not expect the same consideration when it comes to Bill 54; that's an entirely different category.

HON. MR. VANDER ZALM: I'm naturally very pleased with the response from the opposition, and I look forward to Bill 54. I again move second reading.

Motion approved.

Bill 48, Municipalities Enabling and Validating Amendment Act, 1980, read a second time and referred to a Committee of the Whole House for consideration at the next sitting of the House after today.

HON. MR. GARDOM: Mr. Speaker, I call second reading of Bill 46.

BRITISH COLUMBIA PLACE ACT

HON. MR. ROGERS: I take this opportunity to briefly describe to the House and the members the essence of this bill. The bill is basically designed to grant similar powers and capabilities to British Columbia Place Ltd. as those found in the statutes of other Crown corporations. The act itself is in essence a very simple form of legislation. It concerns neither social nor regulatory legislation; instead it merely grants special statutory powers to the corporation.

There are several factors in this bill which need to be highlighted for the benefit of members. The bill itself simply establishes British Columbia Place Ltd. as a Crown corporation with the shares transferred directly to the Crown in the right of the province. The bill also establishes the Minister of Finance (Hon. Mr. Curtis) as the fiscal agent of the House. It is a move which will ensure both fiscal accountability and responsibility of the corporation's financial affairs. The act is designed to prevail over other inconsistencies in the Companies Act or in the memorandum or articles of the company — those documents which serve as the company's own constitution's bylaws.

In addition, the act provides that the Lieutenant-Governor-in-Council has the maximum flexibility to remove or avoid legal legislative impediments, which is timely, and for economical development of British Columbia Place and the site and the amphitheatre.

Funds are also a factor worthy of consideration. The act does not permit the advance of funds to the company in unlimited amounts without first obtaining legislative approval. Instead, by this bill, the Minister of Finance is limited to advances from the various funds involved. Furthermore, the act directs that the government guarantee the borrowing of the Crown corporation. Obviously, Mr. Speaker, the company must first be able to establish its ability to borrow the funds required for business purposes. In other words, the bill provides for the corporation the opportunity to find a tender who will accept its ability to repay the amounts borrowed from its operating revenues. It is worthwhile to point out that such guarantees are first subject to the approval of the government and, secondly, are on the terms and conditions set forward by the Lieutenant-Governor-in-Council.

Finally, an important point is the concern about the expropriation powers of this act. While this power has been included in the act, it's for the sole purpose of acquiring land needed for the establishment and planning of the British Columbia Place site and the geographical definitions. To that extent, I'll be moving the amendment standing in my name on the order paper in committee stage. This distinction is only to provide for greater certainty and clarity to define the location of British Columbia Place.

I move the bill now be read a second time.

MR. MACDONALD: Mr. Speaker, the official opposition welcomes international expositions and monuments in the form of Robson Square, B.C. Place, and things of that kind. What we regret is the want of business acumen on the part of the minister and his government. This bill could be better called "Bennett in Blunderland," not B.C. Place. I

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was sitting up enjoying a sleeping potion about 11:30 the other night, when I saw the hon. minister.

Interjections.

MR. MACDONALD: I had a very good rest that night. I wasn't at all disturbed by what I saw. There on the box was the face of the minister. I presume that what I was watching was not hearsay evidence, but it was what the minister really meant. He was giving a wonderful description of B.C. Place and the roof of the stadium. He said: ''Two hundred acres...." I thought we were only getting 160 acres from the CPR, but it keeps going back and forth and up and down.We're never quite sure what it is, but on that particular night it was 200 acres.

Yet I thought the minister was doing his assignment from the Premier in good taste. He gave a very excellent presentation of the castles that are to be built on the site, but he didn't tell the wondering people of British Columbia that they hadn't got a handle on the land on which this....You didn't mention the land. You didn't mention the CPR. There was not a mention on this program — I know it was only about four minutes — about how the CPR had taken this land from the Indians and now the government was going to acquire it from the CPR and give back to the CPR the minister's own riding of Vancouver South, which used to be CPR land. In order to get the False Creek bottom lands, it's going to be necessary for this government to give them Vancouver South, or the Peace River, or something of that kind — possibly Prince George — to pay for it.

The minister said 200 acres; he's got expropriation powers in this bill. He can't expropriate the CPR, because they've kept this land in their railway company. They haven't even put it into Marathon. Even expropriating Marathon under a provincial statute is pretty dicey, because the CPR is one of the great institutions of this country — they own it, or a good chunk of it, at any rate.

This bill is an incredible record of bungling, and now to cover themselves they've introduced into the bill. Mr. Speaker, a power to expropriate the CPR railway lands in False Creek, which is an empty power and an empty threat. They've given themselves, on the public treasury. an unlimited borrowing power that can be guaranteed by an order-in-council of the cabinet. So by this bill the Legislature, I think for the first time in the history of British Columbia, is giving unlimited borrowing powers to a corporation, known as B.C. Place. Even B.C. Hydro doesn't have that: they have vast commitments and vast contingent liabilities of the province, but there's always a limit on their borrowing power. There's no limit here.

I think when this bill comes to committee the minister is going to have to be asked to explain just how much it is going to cost to get the land from the CPR, and whether the CPR is not in a position to hold up the people of the province now.

MR. HOWARD: They always have been.

MR. MACDONALD: They always drove a pretty hard bargain, but they've never found themselves lucked-out into the kind of situation they are in today, where they've got the purchaser saying: "We're all go; we can't back out of the deal." The only thing to be agreed on is the price, and Big Julie is going to name a pretty stiff price.

Anyway, I appreciate the rest I had after watching the minister, and I look forward to his answers. probably in committee — and probably no answers at all, because he's in a box. We should all feel sorry for him, but we should feel even more sorry for the people of the province.

MR. COCKE: Mr. Speaker, we're running into rather strange circumstances in the Legislature of recent weeks. What we see on one hand is a Minister of Finance first talking about tightening the old belt because of world conditions, and then putting a freeze on hiring, which met a fair amount of resistance and the freeze became a thaw to some extent. We see a government moving in a number of directions, not quite knowing which way to go. But the one place where they have shown evidence of hanging in there, so to speak; is in the area of their monuments.

Now B.C. Place is nothing more or less than a government desperate to look like they are doing something, to look like they are appealing to one side of our community, at least, probably the sporting area of the community. We know they are mixing this up, of course, with Transpo, this international exposition that is hoped to be held on same site. Mr. Speaker, we see a government so desperate for attention that they remind you of a little child that gets into trouble in order to get attention. That's precisely what they have done: they've got into trouble in order to get attention.

The trouble, of course. as my colleague for Vancouver East says, is with the CPR. The history of that noble company, that great corporation. Is that they brought the railroad to Port Moody as they had promised. Now Port Moody was on the Pacific Ocean. and so they had done their job. They brought it into Port Moody. and that's where they stopped. Well, at that point people in old Vancouver, Hastings Mill, or whatever you wanted to call it at the time — where the real natural harbour was, and where the real potential for development was — naturally were woebegone. The government of the province said: "What are you doing" As a result, negotiations began. Those negotiations ended up with the CPR, as my colleague says, owning the very best part of Vancouver, that part which is now Shaughnessy. that part which is now Arbutus, that part which includes Gracie's Finger — believe it or not — recently put-chased from the CPR.... But they've struck a very hard bargain. Mr. Speaker, and I've seen nothing in the intervening years....That was in order for them to bring the railroad from the then terminus, which was at Port Moody, to the Vancouver harbour. Well. Mr. Speaker, I've seen nothing in the intervening years to tell me that they're going to be any easier to deal with now than they were then.

Now it would strike me. If we were doing things in proper order, that what we would first do would be strike a bargain with the CPR before we commit ourselves to the site. Once having committed ourselves to the site, then the CPR can get whatever they want. and that's why the opposition is so opposed to this, way of doing business. When this government was elected, they were elected on the premise that they were the business-oriented group and that the NDP — then the government — wasn't all that business oriented, Well. Mr. Speaker. I want you to compare any of the deals that the NDP made — any one and every one of them — with this abominable thing, with this absolute lack of any kind of business orientation — or at least a government with a lack of any business orientation — in order to put a travesty like this forward.

Mr. Speaker. we know that these are tough times. We know that — providing this B.C. Place ever gets going —

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there will be some people employed building it. But we also know that there are a lot of people who are going to have to pay for it, and it concerns us that we don't know what they're going to have to pay; we haven't a clue. All we know is that the government has unlimited borrowing power and they've vested their unlimited borrowing power in B.C. Place. This is a corporation that can run away with money, and over the years we've seen the Socreds manage to put together these kinds of instruments that have really cost us. The necessity of it — who knows? The placement of it — it strikes me we should have some opportunity, some options, and those options would give us some leverage with the CPR. Presently we have no leverage whatsoever.

When somebody gets on the phone to the head office of the CPR and says, "Now the Ministry of Environment in B.C. wants to negotiate, " they'll say, "Well, in our own time, in our own fashion, and the outcome will be ours." They remember not long ago that they were somewhat frustrated in an attempt to take controlling interest of a major lumber company in this province. I'm not too sure whether that will have too much influence, but I'm not too sure it won't. That's the problem. I think, Mr. Speaker, that the B.C. Place Act is doing things absolutely backwards. We're now committed to an area where I consider that the CPR will exact a toll from us that will be quite unacceptable. It's a shame. It's a shame to have been put in that position.

Now having said that, where else could it go? There are other options. We need not have committed ourselves to them, but at least we would have some kind of an alternative and the CPR would have known it. Now they know we haven't. I just want to wish the minister a lot of luck and I want to suggest that unless he has an awful lot of luck, he's going to be under severe criticism for having done the bidding of the president of the executive council of British Columbia, who so desperately wants to have this monument to himself placed squarely in the middle of Vancouver. It is a very interesting Phenomenon, and I would find it very difficult to support.

MR. HOWARD: When we first heard about B.C. Place this year, it had a ring of unreality about it, especially to those of us who don't happen to live in Vancouver and who have for a long time felt that the financial wherewithal to pay for some of these great monuments comes from the rural areas. In other words, people in the north, in the Okanagan and in the interior will be paying a fair amount of the cost of this particular monument.

They've paid for some of it already. For instance, here's taxpayers' money being used for the front page of British Columbia Government News, a camouflage publication primarily supporting Social Credit. It's misnamed and misused. This is the document that taxpayers paid for that says, "Here's British Columbia Place" — front page, artist's conception. Inside we have another artistic overlay of a photograph of a portion of Vancouver including the downtown-West End area and False Creek. The artist's overlay there, in yellow — an appropriate colour, I might add — shows that the whole north shore of False Creek, running from Main Street — from what I can see here — out towards Granville Bridge is going to be encompassed in this B.C. Place. It's identified as a development for the future.

There's a committee established with respect to B.C. Place that might be worthwhile to identify. It's called an action committee, "headed by Environment Minister Stephen Rogers. He has been named to take on the task of turning the concept into reality. Other members of this action committee are Vancouver mayor Jack Volrich.... He's the mayor of Vancouver; no further comment about that. It might be an appropriate thing to do — somebody from city council in any event. Look who the other members of this action committee are, reading from the article: Finance Minister Hugh Curtis — a Socred — Provincial Secretary Evan Wolfe — another Socred, here by the grace of Gracie's Finger and not by anything that he himself did, but that's another matter — and Vancouver area MLAs Peter Hyndman, Vancouver South, Jack Davis, North Vancouver–Seymour, and Angus Ree, North Vancouver-Capilano. It's interesting to note that of the members of the committee, other than the chairman, the Minister of Environment, none of the other Socred members of that committee who are supposed to be the action element can be bothered to be in the House this morning to take part in any kind of debate. They're all in Public Accounts. Hugh Curtis, Evan Wolfe, Peter Hyndman, Jack Davis and Angus Ree are all in Public Accounts, obviously.

MR. CHAIRMAN: Hon. member, at this point I would ask that if we continue to refer to the members we refer to them by riding.

MR. HOWARD: I'm reading from the publication.

MR. CHAIRMAN: That has been established, hon. member, but if we can maintain parliamentary precedent the Chair would appreciate it.

MR. HOWARD: Well, all these people are members of this action committee. The point I'm trying to make is that the action committee is a Social Credit action committee designed to support a nightmarish-oriented dream of the Premier, who out of desperation last spring had to find something to attempt to rescue himself from the morass he found himself in. And he got into that morass all by himself.

The objection that I want to make to B.C. Place, apart from the fact that one could speculate that the drafter of the legislation was Ian Sinclair himself, was a point made by the second member for Vancouver East (Mr. Macdonald) and the member for New Westminster (Mr. Cocke). Apart from the fact that there is a complete fumbling and an inability on the part of government to be able to get their hands on this particular thing — they don't even know how to go about acquiring the property and so on apart from the wide open, limitless borrowing powers that are being sought in here without any further reference whatever to the Legislative Assembly, and apart from not asking anybody else in the province whether or not they agree to pay for this particular monument, I have an objection to it on the basis that people from the north are the ones who pay far more heavily proportionately for monuments and programs such as this in the lower mainland. People from the Okanagan, the Peace River, the Kootenays, other parts of the interior, Vancouver Island and all over this province are the ones who are being asked to put up the dollars to support this, which is nothing more than a monument to one individual so desperate that he would grasp at anything to try to ensure he's retained in office as the Premier.

Those reasons are adequate enough for me to indicate absolute opposition to this particular concept.

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HON. MR. ROGERS: If I could start with the member for Skeena's comments first, 46 percent of the people who currently attend events at the Empire Stadium are from outside of the lower mainland or the city of Vancouver. Statistics in the Seattle area are even greater for people from all of Washington state and from British Columbia who attend events within their major metropolitan stadium. Certainly if a stadium is going to exist anywhere it has to exist in the major centre. But to expect that it's only for people who are from the lower mainland area or from the immediate vicinity is totally incorrect. There's not sufficient capacity in terms of population in those areas to justify....

Interjection.

HON. MR. ROGERS: I appreciate that the member meant that people from the interior part of the province are going to pay for this, just as much as people from the metropolitan areas pay for some of the privileges that you have in your areas of the province.

There are three Crown corporations which have no limits to their borrowing power. Their names should not be particularly strange to you. They are the British Columbia Petroleum Corporation, British Columbia Cellulose Corporation and the Insurance Corporation of British Columbia. So while you bemoan this particular corporation for having no limit to their borrowing power, one might reflect back on Crown corporations which were put in place by another government.

Interjection.

HON. MR. ROGERS: I'm glad that the second member for Vancouver East is back now. You asked about the 200 acres. If you'd just take a tiny bit of time to look at it, not all the property involved in B.C. Place is owned by Marathon. Some of it is owned by B.C. Hydro, and that will also be acquired for it.

Interjection.

HON. MR. ROGERS: No, we're not going to expropriate that. We don't think that'll be necessary.

You asked about the expropriation. I might say that we don't intend to expropriate the CPR lands. As I have explained publicly, there may be a necessity to expropriate small pieces of property in terms of access to the site, and there also may be a necessity to expropriate leases oil the site once the site has been acquired by British Columbia Place.

The member for New Westminster mentioned the fact that the CPR is not easy to deal with. I don't think that's a revelation that anyone in this House is going to find particularly new. However, we had agreement in principle to swap like land for like land on appraised value before we went into this deal. I might add that Marathon approached the government, rather than the government approaching Marathon in the first place. It was originally their proposal to come to see us.

Interjections.

HON. MR. ROGERS: I'll tell you what: I'm going to speak to people in Fish and Wildlife and see if we can't get a couple of dozen crows so that when the final analysis of what, we pay for this property and what the negotiations are are made public, I'll be able to supply them for people who want to eat a little crow. We'll be able to Supply some crows, because I'm quite confident that....

You commented on the action committee and their absence here, but I'll tell you that they were not absent when we were involved in selecting the people who are the chairman and board of directors of this corporation. They have been spearheading the development to this date and, in addition to that, the negotiations with Marathon. I can tell you that there is a cross-section of people from throughout British Columbia who have been involved as board members of British Columbia Place. They've been the ones who have spearheaded the negotiations. When the final analysis is done I think that all British Columbians will be very proud of the work that they have done on this very worthwhile project.

I move second reading.

[Mr. Davidson in the chair.]

Motion approved on the following division:

YEAS — 26

NAYS — 15

Division ordered to be recorded in the Journals of the House.

Bill 46, British Columbia Place Act. read a second time and referred to a committee of the Whole House for consideration at the next sitting of the House after today.

HON. MR. GARDOM: Second reading of Bill 62, Mr. Speaker.

MINERAL AMENDMENT ACT. 1980

HON. MR. McCLELLAND: Mr. Speaker, this is basically a housekeeping amendment to the Mineral Act. There has been some question in the Attorney-General's ministry for some time that the reserves which were put on regarding the staking of mineral claims may not have been fully covered in law. We're ensuring that that's the case at the present time: we're increasing the number of units of claims which can be held together — from 40 to 100 so that you could have 5 units of 20.

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The final amendment is to facilitate complaints which now must be dealt with personally by the minister. The number of activities in place at the present time regarding mining activity in the province has created a serious backlog over the last year or year and a half. In the past those claims were always held by the gold commissioner himself; that was always well accepted by the mining community. We're suggesting a return to the old method of hearing appeals in order to not only facilitate those which are waiting to be heard at the present time but also to facilitate hearing future appeals so that people don't have to wait for months in order to have their concerns heard.

MR. HOWARD: The examination that the members of the official opposition have made with respect to this bill substantially confirms that the minister has outlined it in reasonably accurate terms — that's quite a concession to make! There are some complexities in it which can be dealt with more appropriately at the committee stage, which is what we will be doing on another occasion.

HON. MR. McCLELLAND: Mr. Speaker, I move second reading.

Motion approved.

Bill 62, Mineral Amendment Act, 1980, read a second time and referred to a Committee of the Whole House for consideration at the next sitting of the House after today.

HON. MR. GARDOM: Second reading of Bill 52, Mr. Speaker.

UTILITIES COMMISSION ACT

HON. MR. McCLELLAND: Mr. Speaker, at the outset in introducing second reading of this bill, the Utilities Commission Act, I would say that in preparing it for presentation to the Legislature we had a choice of putting in amendments to the Energy Act or coming forward with a new act. It was the advice of various officials in my ministry and in the Ministry of the Attorney-General that, since there were such major principles involved, it would probably be appropriate to bring forth a new bill. In so doing the large majority of the sections included in this rather large bill are simply sections which have been moved over from the Energy Act to the Utilities Commission Act. Changes to some of those sections may be necessary sometime in the future, but at this point the urgency was to get a new commission in place and make the opportunity for full regulation of B.C. Hydro and the review of major energy projects in the province as quickly as we possibly could. We felt it had to be done this session, so many of the questions which may be raised on other sections of this bill, which are being left intact, have not been addressed at this time. That may happen sometime in the future.

Mr. Speaker, I'd like to point out that last February the government put forward in its energy policy statement a framework within which this province might build an energy-secure province. We identified the government's role of energy stewardship and we outlined some of the directions we would take in fulfilling our energy mandate. Since that time we have taken a number of steps to implement various elements of this energy policy — steps, in fact, towards energy security.

Energy-demand forecasts are now prepared annually by the ministry to allow energy policy to be based on up-to-date and accurate information. The Energy Development Agency has been formed, with $10 million budgeted for this year, to initiate research and development of the energy technology of the future. Studies to develop electrical generation from thermal coal, coal and wood waste, geothermal activity, the sun and the wind have been started.

Proposals to establish a secure supply of energy at a fair price to all British Columbians have been put forward. An example is the Vancouver Island natural gas pipeline. We hope the rural gasification program — a matter which I mentioned during debate on my estimates — will come forward soon. There is active encouragement of coal development in various parts of the province. A review of natural gas pricing, both in the field and at the wholesale level, has been ordered and will be started by the Utilities Commission next month. A pricing policy for industrial and processing applications of natural gas has been developed a pricing policy, I might say, which ensures that British Columbians get the best value for the use of a depleting resource.

Programs to encourage energy conservation in all sectors have been continued and developed — the B.C. Energy Bus Program and Operation Tune-up, to name a couple. A joint energy resources strategy committee has been formed with the province of Alberta to ensure that our two provinces may participate in the orderly development and marketing of our energy resources.

The energy field is very broad and multifaceted. There are many areas still to be addressed, many initiatives yet to be undertaken, and many issues of ongoing concern. The legislation we have introduced today, Bill 52, provides some of the tools with which the government, in consultation with the people of this province, may attend to these matters and manage our energy future in an effective and responsible manner.

[Ms. Sanford in the chair.]

The highlights of the legislation are as follows: the British Columbia Utilities Commission is created and replaces the B.C. Energy Commission in its regulatory functions. The B.C. Hydro and Power Authority is brought under public regulatory control for the first time in its history since it was established in 1964. The major projects review process, promised in the government's energy policy statement, is created. Public hearings under the review process will be administered by the Utilities Commission, but will be separate from its regulatory function. The government is given authority to issue energy-removal certificates for energy supplies deemed surplus to provincial needs. The cabinet is vested with the clear responsibility for energy policy in British Columbia.

I'll just take a moment to expand on a couple of these points. As I've said, the B.C. Utilities Commission will take over from the Energy Commission the role of rate regulation. This role will be expanded to include the regulation of B.C. Hydro rates. Proposed rate increases will be subject to hearings before the Utilities Commission. These hearings will ensure a rate structure for energy that is fair to all and consistent with overall government energy policy. In addition, the Utilities Commission will take on the regulation of services and additions to facilities of all energy utilities in the

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province, including B.C. Hydro. In this role the commission can help to ensure secure and continuous supplies of energy to all British Columbians.

Apart from that, the key feature of the new legislation is the establishment of the streamlined review process for major energy generation and use projects in B.C. The legislation requires that all major energy projects be submitted for review. The term "major energy projects" is carefully defined in the bill to include all new projects, as well as all additions to current facilities which will generate or use a significant amount of energy. The legislation also provides that any energy undertaking, of whatever size, if it is deemed by the minister or by cabinet to be of significant impact. may also, despite that it does not reach the size requirements in the act, be made subject to the review process.

Madam Speaker, the Minister of Environment will play a major role in developing both the criteria and the terms of reference for review projects. It will only be on the joint recommendation of the Minister of Environment and the Minister of Energy, Mines and Petroleum Resources that projects will be considered for review.

In addition to one or more permanent utilities commissioners on the panels for review, it may also include a number of temporary commissioners selected, we believe. for their particular expertise or interest in the matter at hand, or perhaps for the particular region of the province which they may represent, because we feel it's important that these review panels be representative not only of Victoria or Vancouver but of the area in which the project itself will have the most general impact. The manner of setting up separate review project panels will allow us the utmost flexibility in dealing with these matters to the best benefit of the local community. The public hearings will canvass as wide a range of public opinion as possible in each case. Using the base of information gained through the hearings, the commission can then provide its report and recommendations to cabinet on the merits of the project application. Ultimately the decision to issue energy project and operation certificates will rest with the government.

The utilities commission legislation also provides for the regulation or review of energy removals from this province for the first time. Energy removal certificates issued through procedures similar to those I have described for the project and operation certificates will be required for all energy leaving this province. Exemptions are provided for contracts already in force — export licences and other things like that — which have been issued by the National Energy Board prior to this legislation, and anything else which is already in place.

The significance of the legislation's provision for the energy review process is that it gives the general public direct access to energy decisions for the first time ever. It allows all the arguments for or against a given project to be brought forward in public for full consideration. Conversely, it gives the government a means of consulting the people of this province and other interested parties on energy generation and use projects, so that in developing our energy resources we do not compromise other less tangible resources such as the quality of life in British Columbia — the integrity of our environment. Perhaps most important, it gives the government the means to ensure that energy development and use is addressed in a comprehensive manner, taking into account all the costs and benefits of any project and making sure that it meets both the short- and longer-term needs of British

Columbia. We have realized that energy development and use cannot be separated in what we intend to be a truly comprehensive energy policy. Since the export of energy may also be considered an energy use. the provision that I've spoken of earlier bears a similar significance in any kind of comprehensive policy.

In summation, the Utilities Commission Act will provide a mechanism of streamlined public review of energy projects which gives both industry and the general public their full opportunity for participation, sets up a panel of experts who will assimilate that information, compile reports and make recommendations. and provides the government with the means to make informed policy decisions on energy development and use.

The final responsibility for such far-reaching decisions must lie with the government. which is accountable to this Legislature and. ultimately, through this Legislature to the people of British Columbia. We are indeed entering a new era of energy management in British Columbia. The government has an energy policy now in place and is bringing that policy into effect as quickly as possible. With this new legislation, we will be better able to fulfil our mandate of energy stewardship, fully aware of the responsibilities of that role, and work with the people of British Columbia towards our ultimate goal of energy security.

With those remarks. Madam Speaker. I move second reading of Bill 52.

MR. SKELLY: The opposition intends to oppose Bill 52 for a number of reasons which I'd like to outline for the Legislature. Unfortunately, for personal reasons our energy critic cannot be here, but he has asked me to deal with some of these issues as the bill comes on the floor.

In response to the minister. Madam Speaker. the first thing about this bill that struck us when our research staff and our critics took a look at it was that it lacked any originality whatsoever; it lacked any justification for the fanfare that was given it by the Social Credit government — as in the so-called energy policy that was brought down in February. There is really nothing new in this legislation to justify the fanfare that brought it in in the first place. We checked through the bill section by section, of course, as we always do, and out of the 159 sections we found roughly a dozen new ones. Those dozen new sections give to the government roughly the same powers they already had under existing legislation which gives cabinet authority to do the things that this bill gives cabinet the authority to do.

The only people who lose in this legislation — as far as we can determine — are those citizens of the province of British Columbia who are concerned about energy project developments. concerned about the operation of energy projects, and who, having looked at this legislation, find no additional vehicle for the expression of public concern into government circles. They have another hoop that they have to jump through- that is, through the Utilities Commission. As everybody can see both from the wording of this bill and from the interpretation of this bill by lawyers throughout the country who are expert in regulatory law, there is no additional, effective voice for the public in this critical area of energy project approval.

Prior to the passage of this bill and the time that this bill is implemented. anyone who was concerned, for example, about a hydroelectric dam, could have contacted the comptroller of water rights, appeal to the comptroller of water

[ Page 4064 ]

rights, and a hearing would be held. There was a set procedure for calling and examining witnesses, and at least they could have some kind of public voice on how water was to be allocated to the project, which was critical to the project going ahead. That is no longer possible, from what I understand, under this statute, nor is an appeal under the water licence possible. So one avenue of citizen appeal, Madam Speaker, has been cut off under this new section of the Energy Act.

Also, citizens affected by the effluents or by the emissions from a thermal plant could appear at a Pollution Control Board hearing, and could outline their opposition to the effluent and emissions of a thermal plant. Now that avenue of public hearing for the citizens has been cut off, as far as we can see from this act. The avenue of appeal has been cut off as well. So all of those powers that the citizens had prior to the bringing in of this act — an appeal to the Pollution Control Board, a further appeal to cabinet, an appeal to the comptroller of water rights and a further appeal beyond him to a cabinet committee — have been wiped out in a single stroke.

Citizen opposition has now been focused on this so-called public utilities commission or B.C. Utilities Commission, and only in this one forum will citizens have the right to express their concern about large energy generation and transmission projects. But it's a body, Madam Speaker, that is totally the creature of cabinet. In fact, under the old Energy Act the legislation said that the commission could do nothing unless it was referred to it by cabinet. This statute takes two sections to direct the new Utilities Commission. In the first section they say the Utilities Commission shall do nothing unless cabinet tells it to do whatever it wants it to do.

Furthermore, anything that the commission does after public hearings, after making recommendations and reporting to cabinet....Cabinet simply doesn't have to follow the report and the recommendations of the Utilities Commission. Those could be thrown out and a second voice could come in behind the curtain — the voice of B.C. Hydro, Noranda or Westcoast Transmission. Any of those energy utilities in the province could come in behind the curtain of cabinet and have their way impressed on cabinet and receive a project certificate and an operating certificate in spite of what went on before the public utilities commission — the reason for this being that the commission is absolutely powerless. This legislation emasculates any public utilities commission as we know it. There really is no commission; it's simply another bureaucratic hoop that citizens and utility companies have to jump through in order to get cabinet approvals which cabinet already has the power to give.

So really, Madam Speaker, there is nothing original in this energy bill, nothing to justify the fanfare with which it was presented in this Legislature and through the energy policy — or what stands for an energy policy — when this government brought it in last February.

When you look at utility commissions that have been established in other areas of North America, for example in California, those states see the commission as an effective instrument of public policy. Behind that public policy and behind the commission stands a commitment on the part of some of those states to use energy more efficiently, and another commitment: to allow citizens greater and more effective voice in energy decisions that are being made within their jurisdiction. There is none of that here. Really there is no energy policy in this province. This legislation doesn't spell out the energy policy terms under which this commission is to make its decisions, recommendations and reports. None of that is spelled out in this legislation. Basically they're still operating in a policy vacuum.

In the state of California, if a utility comes before the California Utilities Commission asking, for example, to build a huge oil-fired thermal generating station, the California Utilities Commission must, because of its instructions from the government, ask that utility what alternatives they have sought to this expensive form of generation. The utility must then reply to the commission that they've exhausted all other alternatives, including energy conservation and making their customers' homes and businesses more energy efficient; then the commission can allow them to build a new oil-fired generating plant. But most of those utilities in the state of California have found that it's much cheaper for them to get involved in energy efficiency than it is to build new plants. As a result, when I was visiting the area a few weeks ago, something like 3,000 megawatts of new generating facilities had been cancelled or delayed because Californians are using energy more efficiently. One of the reasons for that is that the Utilities Commission in California is seen by the government as an independent, effective instrument of government policy that can demand alternative ways of producing power or saving power from the utilities that come before it seeking project development certificates.

There is nothing like that in the 12 new sections of this act that provide for energy project certificates and operating certificates. This is a disastrous act for the province of British Columbia. When we look at the amount of cabinet discretion that has been placed in legislation in this Legislature over the past five or six months it's frightening. Every day in this Legislature we see the power of citizen input in government decisions eroded to the point where it's almost no longer existent, particularly in the energy field. A citizen has virtually no power to effectively suggest to the government what energy projects they want and what energy projects they don't want. If you canvass the citizens of this province and ask them if they would like to have the province more energy efficient, using less energy to do more work, I guarantee you that you'd get almost 100 percent favourable response. Yet the government hasn't seen fit to canvass the citizens of the province.

[Mr. Davidson in the chair.]

Obviously they consulted with B.C. Hydro and some of the private utilities around the province before drafting this legislation. Whatever they say, Hydro must be ecstatic at the presentation of this bill. Certainly they have to jump through an additional hoop to get their pricing policy established, but they're willing to do that in any case. But in the key sections, in the consequential amendments, it points out that Hydro doesn't have to go to the B.C. Utilities Commission to have its debt examined or any additional ways of raising capital examined — except that it must come through the Legislature.

When the minister makes a statement and he's poorly informed as to Hydro's borrowing requirements, we have to accept his word as to what Hydro's requirements are — and they're very poorly stated, not very specific. It can be predicted that the Legislature will vote an increase in Hydro's borrowing bill or a ceiling on Hydro's borrowing almost year after year. That doesn't say where Hydro's going to borrow the money or whether they're going to take it out of civil

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servants' pensions at below market rate to the point where we have to consider alternate means of funding those pension plans because we're robbing from them to subsidize utilities. Certainly Hydro would prefer to have their borrowing authority debated in this Legislature where there's a government majority and where the willingness appears to be here on the part of the government to steal from those pension plans to subsidize B.C. Hydro.

Why isn't the Utilities Commission given the jurisdiction to examine Hydro's borrowing requirements and to decide whether they are appropriate to energy planning for the province in the future? That should have been included in this legislation, and it isn't. How is the Utilities Commission going to make any pricing decisions with respect to B.C. Hydro without considering Hydro's borrowing requirements and the revenue required to pay back those loans that Hydro can obtain in the New York markets, or out of provincial service pension plans, or out of the low market rate borrowings from Canada pension plans? That jurisdiction should have been given to the Utilities Commission.

All of the power in this bill really devolves back onto the cabinet. The commission is simply a creature of cabinet and all it does is create another bureaucratic hoop. Information was put forward at public hearings on behalf of utilities and by citizens who are concerned about those environmental projects such as Site C, the Cheekye-Dunsmuir power line, the Hat Creek development, and the Stikine development. These are going ahead in spite of the legislation coming down. In spite of all of those things the citizens are really going to have no more effective public voice in the energy decisions than they've had in the past. Cabinet is going to be the one to decide. All we'll have is this little extra bureaucratic hoop to jump through before getting to the final decision-maker, which is cabinet. But the one thing cabinet has seen fit to do here is to eliminate the appeal procedures under the Water Act and the Pollution Control Act. So there is virtually no appeal now from a cabinet decision.

All of those peop

Spooky…

le, Mr. Chairman, who were looking forward to this legislation to provide them with a better, more effective avenue of citizen input to government energy decisions now find that they've been totally cut out. Government seems to have the attitude that those who are concerned about energy and those who are concerned about the environment are a bunch of long-haired, raggedy-clothed hippies. That's simply not the case. The people who are concerned about energy today are the people who, for example, are paying the price of the Columbia River development, either through having their land flooded and lost forever in the Kootenays.... On the MacGregor diversion proposal. people who saw that thousands upon thousands of acres of timber would be put under water.... We think of Hydro as a renewable resource, yet it's not a renewable resource. In spite of what you read in the throne speech. The land under which you store that water can never be replaced to its previous productiveness. Hydro is not a renewable resource. It may be partly, but it's not to be considered a renewable resource.

All of these people who are concerned about energy projects are not wild-eyed hippies. They are people who have lost significantly as a result of the activities of this government and its instrument, B.C. Hydro, in the past. They are paying on their electricity bills for the privilege of that loss, and they're being told that they're going to have to sacrifice further the lands and natural resources of this province in order to justify Hydro's expansion. Nothing we can see in this bill is going to stop that or give the citizens any more public input than they've had in the past into attempting to put a stop to it through citizen action.

It's interesting right now that people who have not had the opportunity of a sufficient public hearing are now demonstrating on Texada Island to try to stop a right-of-way clearing project for the new 500-kilovolt Cheekye-Dunsmuir power line. I gather seven of them have already been taken off to jail, thanks to this government's decision not to give those citizens adequate public input.

Under the linear guidelines that the government brought down to cover developments such as power lines, highways, pipelines and those kinds of things, a public hearing was a requirement. The principal was required to hold a public hearing. In this case the government exempted him from the public hearing.

Also under the linear guidelines a proponent for a project is required to do an economic cost-benefit study to show how the costs and benefits are distributed throughout the province, not simply within the corporation. Hydro did a study to show the costs and benefits to the corporation. Cabinet accepted it, even though it violated the requirements under the linear guidelines.

Again, you go back to cabinet decisions. There is no change now under this legislation from what previously applied. Cabinet still has the right to set out the terms of reference to the public utilities commission. As cabinet sees fit they can still abridge the guidelines in order to justify one project going ahead or to cancel the project.

[Mr. Strachan in the chair.]

The Utilities Commission has virtually no power except as a servant to cabinet. Their decisions aren't written down; their recommendations aren't written down; there's no obligation that that be made available to the public. So the public isn't any better informed now than they were in the past, when energy matters were totally under the jurisdiction of cabinet. Nothing has changed.

If this is supposed to be the brilliant new legislation that's going to govern the development of energy in the province of British Columbia. It's really a piece of garbage, and the minister should admit it. There is nothing whatsoever that's new in this legislation.

Why, couldn't we have a statement of policy written into legislation which would be a guide to the Utilities Commission in making their recommendations? Why was it left in the hands of the minister to make up policy as he goes along? If the minister wants the Site C dam to proceed, he will set out the terms of reference to the Utilities Commission in such a way that that dam is going to go ahead. We know he wants that dam to go ahead. 

If he wants the Hat Creek thermal project to go ahead. he, in consultation with the Minister of Environment (Hon. Mr. Rogers), will simply prescribe terms of reference to the Utilities Commission, chaired by a political hack — whom he appointed — with no previous experience in energy matters; her only experience, the thing that got her the job, was that she was the daughter of a former Social Credit MLA. What the minister can do is prescribe terms of reference to his political hack on the commission; as a result, if they want Hat Creek thermal. they're going to get Hat Creek thermal.

It's a cruel 'joke on the citizens of this province, Mr.

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Speaker. Really what we're doing, within the Social Credit Party cabinet and through Social Credit Party hacks, is making it appear that the public has better protection from the discretionary activities of government than they've had in the past. That is simply not the fact that is brought out in this legislation.

Our caucus intends to oppose this legislation because it does nothing to further improved and effective public input into energy decisions in British Columbia.

MR. DAVIS: Mr. Speaker, I will be supporting Bill 52. I support its general objectives. Some of its details, however, bother me, so I intend to speak again at the committee stage, however briefly. I'll then be putting forward recommendations to the Minister of Energy, Mines and Petroleum Resources which, if implemented, will improve the legislation considerably. At least that's my view.

Essentially Bill 52 has two parts: one deals with the regulatory functions of a new public utilities commission; the other describes a project review process that reaches out even farther into the private sector. It is new in the sense that we haven't had this kind of legislation in B.C. before. It deals with energy- intensive industries, whether they are regulated monopolies or not.

This project review process will, I hope, simplify things for companies and agencies that want to build large power dams, pipelines, smelters and chemical plants in British Columbia. The energy review process will apply to regulated and non-regulated entities alike; it will apply to public sector corporations like B.C. Hydro as well as private sector companies like Inland Natural Gas and the Aluminum Company of Canada. It's also innovative, in the sense that it tidies up the approval process. It amounts to a single desk stop insofar as government permits are concerned. Hearings will be held more often than not, but when they are over and the commission has made its recommendations, the developer will get its licences and permits all at the same time. Delays will be minimized in this way and uncertainty reduced. The discussions, the debate and the arguments will be focused. The public will be better informed, certainly, than they have been traditionally in B.C. Ministers, who have to get elected, will make the final decision as to whether or not a project goes ahead. They will do so, however, after the project in question has been studied and has been debated in a public forum dealing with all of the aspects of a major energy development. In other words, it will be a review process that is not only new in B.C. but that can be thorough and may well be precedent- setting in Canada.

With our new energy project review process in place the applicant will start with ministers and end with ministers — the Minister of Energy, Mines and Petroleum Resources and the Minister of Environment for B.C. The timetable will be set. A commission panel will be appointed. Interested parties will have a chance to be heard. Officials from relevant ministries will make their input as well. Recommendations will be made within a span of six months or a year. Then it will be go or no go, with the final decision being made at cabinet level.

This, in my view, is responsible government at its best. True, each applicant still has to touch all on the same basis that they do now. Officialdom has to meet the applicant halfway, essentially in the commission's offices, and in the public forum which a panel of the commission will provide. A critical path still has to be followed. But with this energy project review process in place it is an obstacle course of known dimensions, Mr. Speaker. It will result in a decision one way or another in a reasonable period of time, and those concerned with social and environmental impacts will have a say in the outcome, whatever that may be.

So far I've been praising the bill, and in general I praise the government and the minister for introducing it. I think the energy review process in particular is a good idea. It's a sound idea. It will speed up and clean up the process whereby large new developments on the energy front are authorized. But we must also be practical, and I hope the practice, in this case, will suit that definition. No one is going to spend large sums of money — sometimes many hundreds of millions of dollars — building a new project when they can't be sure they'll receive a permit to operate it once its construction is complete. Obviously the project review process, insofar as project operations are concerned, must be linked with the construction phase. Operating procedures must be cleared at the same time that the building permits are issued. They are all of a piece; when it comes to financing, you can't have one without the other. All objections must be met and the way cleared through to the production phase before, a new-project review process can be said to be complete.

We're dealing, essentially, with big projects, Mr. Speaker, energy- intensive projects, expensive projects, projects which could be damaging to the environment unless they are built and operated in the right way. Bill 52 mentions three PJ of energy as the cutoff point. That means development on the electrical side of 100,000 kilowatts or more; it means pipelines carrying three billion cubic feet of natural gas or more; it means refineries capable of processing 500,000 barrels of oil a year, for example. It would include an industry using 250,000 tonnes of coal per annum. Perhaps the line should be drawn a bit higher, at five PJ, for example, but it is of the right order of magnitude. Projects producing or consuming energy in these quantities are big projects in anyone's eyes. They can't go ahead without the government issuing various permits in any case. For the rest of us and for their proponents, the new project review process therefore makes a lot of sense. It makes sense for reasons of scale and it makes sense administratively as well.

There are other size cutoffs in Bill 52 and some of these give me a little trouble. Anything over 20 megawatts is to be fully regulated if it is a hydro power plant, a fuel-burning powerplant, or an addition to an existing powerplant of more than 20-megawatt capacity. These are small units. A single prime mover in a multi-unit compressor station on a natural gas pipeline is 20 megawatts today. Does this mean that any industry which wants to build a small generating station runs the risk of becoming a regulated utility in future in this province'? Does it mean that a mining company that wants to put in a small dam and produce its own power will have to go first to the minister, then to the public utilities commission, and back again? We're talking about power installations with an energy — producing capability equivalent to that of a small jet engine in a small executive jet. I don't think small installations like this should be caught up automatically in the project review process. I certainly don't think they should become regulated projects in the sense that their costs must be examined and their rates set by a regulatory commission here in B.C.

Still on the question of size, I personally would eliminate the clause which includes as a regulated project: "an undertaking of any kind that the Lieutenant-Governor- in-Council

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designates to be significant in the matter of energy. " What does that mean? It could be any size whatsoever. It could produce steam rather than electricity. It could burn wastewood or garbage, for that matter. These are sweeping powers. In my view, especially in this area of size, they cover too much ground. I therefore think Bill 52 goes too far, at least in the definition of size. It goes down to projects which are small and medium sized and shouldn't be included in legislation of this kind. It shouldn't be phrased in such a way as to cover all energy-producing and energy-consuming activities regardless of their size and regardless of the way in which they impact on the area in which they are located. When it comes to power plants — hydroelectric and thermal — I would put the figure at 100 megawatts. That's in line with the minimum cutoff figure for the project review process. If it's not 100 megawatts, then it should be 50 megawatts for regulatory purposes. That's small enough, as far as I am concerned.

Hon. members and Mr. Speaker should be clear about one thing: we're not just talking in this legislation about projects which produce energy or which simply transport energy; we're talking about plants which use energy as well. Bill 52 goes beyond the production and transportation of energy; it reaches out from the supply side into the energy demand side, the energy use side. When it comes to a matter of scale, it treats consumers of energy and suppliers of energy alike. It includes "energy use projects" such as — and I'm quoting again from the bill — "a mill, factory, plant. smelter, oil refinery, metal refinery or other undertaking designed to use, convert or process energy at a rate of 3 or more a year" — same cutoff point, same sizes.

But now we're on the demand side of the ledger, the use side — we're talking about using energy, not producing it, and delivering it to consumers in B.C. That's really new, Mr. Speaker. The Minister of Energy, Mines and Petroleum Resources will now become more than a minister responsible for supplying raw and semi-processed energy to our economy he will also be moving into the forest and mineral resource processing category in a big way. Not only does the energy project review process cover Alcan's expansion, but that of our larger pulp and paper mills as well. B.C.'s Energy minister will in future be the minister responsible for the construction — and clearing of the operation — of large plants producing petrochemicals and electrochemicals. He will have a big say in the manufacture of fertilizers and of by-products from coal, oil and natural gas.

Energy trans-shipment terminals and storage facilities are also listed in this legislation. If a coal stockpile is large enough, it could conceivably be affected by this bill; certainly a major port installation would be. Clearly, British Columbia's Minister of Energy, Mines and Petroleum Resources will have a considerable influence on the province's industrial development in the 1980s. He, together with the Minister of Environment, will be the real minister of industry insofar as resource development is concerned. This may be all to the good, but I must point out that no other province has given its Energy minister such sweeping powers over its resource processing activities. Few jurisdictions anywhere have brought energy-use industries into their regulatory framework to the extent we will be by passing Bill 52 in this House. This is the main reason why I would like Bill 52 to be more explicit on the energy use side. We must confine our project review and regulatory activities to genuine energy-intensive projects. We musn't include small-and medium-sized energy using industries in this regulatory framework in this highly bureaucratized procedure which should be limited to major developments with important economic and environmental consequences for us all.

Let me move on to co-generation. Mr. Speaker. Industries that use a lot of fuel an power should be encouraged to produce as much of their own requirements as possible. This is true particularly of firms that generate vast quantities of wood wastes, mine tailings, etc. If these wastes are combustible and can be burned cleanly, then they should be put to use. This bill doesn't help. In my view. It hurts the economics of co-generation by limiting an industry's sale of surplus energy to 15 percent of its own annual consumption. How? If the plant sells more than 15 percent of its energy output it will automatically become a regulated utility under this act. I personally think that the figure 15 percent is too low. It should be more like 50 percent. Then an industry that wants to use its own wastes for energy-producing purposes can build for the future. It can overbuild with other plant expansion in mind and can sell up to half of its output of steam or electricity without being caught up in the kind of red tape that is usually encountered by applicants who have to go before a public utilities commission whenever they want to change their prices or add new equipment to their plant.

I think I know what the hon. Minister of Energy, Mines and Petroleum Resources will say in this connection. He will say that this industry can sell any amount of its by-product energy to B.C. Hydro. But that's not the point. B, C. Hydro is like Big Brother. It's everywhere and it can set any price it wants. So our beleaguered industry should be free to sell its surplus energy to another firm nearby. It should be free to supply electricity to other companies in the area in which it is located. and not automatically be classed as a regulated utility. Surely corporations that produce energy primarily for their own purposes shouldn't have to deal only with B.C. Hydro. A little competition is good for everyone, and an industry that can produce energy from its waste products may be doing us all a service. Why blanket it with red tape if it has some surplus power to sell and that power can find a home in another industry nearby?

I agree that an industry that sells energy to homes and stores other than those of its own employees should be classed as a utility. But I'm talking about industry-to-industry sales and I'm talking about co-generation with surplus power crossing the factory fence and being consumed in another factory or energy-intensive operation in the same neighbourhood. Let us give the production of energy from sources other than falling water and high-grade fuels a chance also. It's never going to get off the ground. B.C. Hydro, with its ever-present surpluses of generating plants and equipment can refuse to pay the kind of price for power which our energy self-sufficient firms or would-be energy self sufficient firms will need in order to break even in their utilization of wood and other wastes.

B.C. Hydro is big. It's the biggest corporation by a country mile in western Canada. It's bigger by far than Esso Resources Canada Ltd. In Calgary, Syncrude Canada Ltd., and Shell or PetroCanada. Now it appears we're in the process of creating another large government-owned corporation here in British Columbia. I refer to the B.C. Petroleum Corporation. It will play a more important role on the B.C. energy scene as a result of Bill 52.

Not only will the B.C. Petroleum Corporation continue in its monopoly role as a purchaser of natural gas in the field

[ Page 4068 ]

in this province, but it will also be the sole seller of natural gas in bulk to big energy-intensive industries. It will be more than a tax gatherer — a phrase which some of us on this side of the House have been fond of using in recent years. It will be a price negotiator. It will buy large quantities of B.C. gas and sell large quantities to gas-using industries of various kinds. It will interpose itself between transporting utilities like Westcoast Transmission, Inland Natural Gas Co. and the end-user industries. It will negotiate the price and other conditions of sale of natural gas to petrochemical plants, smelters and pulpmills. It will negotiate contracts, presumably in the public interest, which vary from time to time and place to place. In other words, the B.C. Petroleum Corporation will be another monopoly, a government owned and sponsored monopoly, which deals with the private sector on a case-by-case basis with the capture of a maximum resource rent in mind.

Clearly the role of private enterprise in British Columbia's resource processing sector is compromised by this development. It's compromised not only by the establishment of the government-owned B.C. Petroleum Corporation as the sole supplier of natural gas in these industries, but also by the BCPC's case-by-case approach to pricing. As a petrochemical, mineral processing, or major forest products company, each of them is going to have to negotiate a special contract with this Crown corporation that is directed by the government of the day. It used to be that low-cost energy was seen as a magnet for industry, a magnet with which to attract industry to this country — certainly to upgrade our resources before they were sold on the export markets of the world.

[Mr. Davidson in the chair.]

Alberta still does this, using low utility rates and a guaranteed long-term source of supply of energy as drawing cards. There, new energy-intensive industries can also go directly to the field and buy gas from the producer in the field — if they can get lower costs, lower-priced raw materials, lower-priced energy in this way. But in British Columbia in the future, if you're big, if you use natural gas to process raw materials here, and if you want continuity of supply, you're going to have to go to the B.C. Petroleum Corporation. It's going to be Mr. Big, the equivalent in gas to B.C. Hydro in electricity, insofar as this vital raw material and heat-source energy is concerned.

As I said before, I would leave the sourcing of natural gas entirely to the private sector and would require our utilities to carry it to its markets — both large and small — on a common-carrier and otherwise regulated basis.

Frankly, I'm worried. We haven't had a large energy-intensive resource — process in g industry start up in this province for nearly a decade, Mr. Speaker. True, Cominco is rebuilding part of its metal smelting and refining operations at Trail. True, Alcan is thinking about building new aluminum refining facilities in the Kitimat area. But we've had nothing on the scale of the big petrochemical developments which have taken place in Alberta or some of the electrochemical projects which have been built in recent years in Quebec. We may think the world is beating a path to our doorway — to our cheap, secure energy — but we don't need to set up administrative barriers and government corporations to protect our energy supply when established institutions of a less interventionist nature exist in this country and, indeed, on this continent — ones which can look after our best long-term interests just as effectively, and in a more expeditious and private enterprise way.

Some may say that British Columbia needs a Crown corporation to head off PetroCan. Ottawa shouldn't be allowed to do with its big Crown-owned corporation what B.C. with its B.C. Petroleum Corporation could do for itself. This I regard as really a red herring, Mr. Speaker. If we need government initiative in any of these areas, let government go the private enterprise route. If it doesn't want to allocate all the responsibility to the private sector, then the government should take a 50 percent interest in the action: it should put up half the equity; it should become a partner in the key energy-producing and energy-intensive industries that will and should process our resources here. If there's likely to be a big windfall profit, the B.C. taxpayer should get in on the act. Let government become a half-owner in some of these enterprises. Owning half the action and stripping off half the profits in terms of corporate income taxes, we as Canadians will automatically pick up 75 percent of the profits in an operation of this kind. Foreign capital would then be providing much of the know how. It would link us to firm markets abroad; most important, from a Canadian self-image point of view, it would make us owners and entrepreneurs in our own eyes: competitive at home and abroad, and innovators and producers, often on a world scale.

On looking through Bill 52. I note several references to the Minister of Environment. His concurrence is necessary in order to refer an energy project application to the Utilities Commission for review. His concurrence is also required when a regulated project is declared exempt from provisions of this act. Environmental considerations, in other words, are given a high priority in the energy project review process. A project is finally approved for construction and operation when it clearly has the approval of the government, certainly of the Minister of Energy, Mines and Petroleum Resources and also of the Minister of Environment.

There's a great deal more to this act, Mr. Speaker. There are, for example, the extensive powers of the Utilities Commission as a regulatory body. Most of the clauses have been taken word for word out of the B.C. energy commission act — NDP legislation, dating back to 1974; in other words, it is being repeated more or less verbatim in this bill. Those clauses are cumbersome. Certainly those parts of the bill are cumbersome in places, and indeed unworkable in others. Therefore those sections of the bill need updating; they need a combing-out. There are parts of the regulatory sections which should be rewritten in their entirety.

Let me give you a few examples before closing, Mr. Speaker. "The powers given to the commission by this Act apply...notwithstanding that the subject matter about which the powers are exercisable is the subject matter of an agreement or another Act....Another one, to quote: "The commission is not bound to follow legal precedent. " A third example: "No act or decision of the commission shall be questioned or held invalid on the ground that no notice or insufficient notice has been given to any person." A fourth quote: ''Nothing in, or done under, the Municipal Act supersedes or impairs a power conferred on the commission...or relieves a person of an obligation imposed by or under this Act...

Section 112 ( l ) reads:

"The commission may take the steps and employ the persons it considers necessary to enforce an order made by it, and, for that purpose, may forcibly or

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otherwise enter on, seize and take possession of the whole or any part of the business and the property of a public utility affected by the order, together with the records, offices and facilities of the utility."

In other words, don't become a regulated utility in British Columbia, because you'll be exposed to all of those powers of the commission.

Part 4 of the act is also taken, in this instance, word for word out of the B.C. Energy Commission act passed by the NDP in 1974. It effectively regulates all aspects of the oil industry in British Columbia, at least if it were enforced. It provides controls over quantities of oil and petroleum products, and can allocate these quantities to any user. It sets prices; it can even regulate hours of sale. It's a very extensive regulatory section 1n the bill, and I think that part of the bill should be rewritten and condensed, and some of its more punitive aspects should be removed. After all, Mr. Speaker, the federal government, as a result of its legislation, now has very extensive powers over the allocation of petroleum products across Canada and over price-setting. It is interfering with the free market in petroleum products to a very substantial extent, and I don't think we need to duplicate all of those federal powers in this province. In other words, I think that the parts of the bill which simply repeat most of the B.C. Energy Commission act of 1974 need rewriting. Perhaps this can be done at another session of this Legislature. I certainly hope so.

To sum up, I think that the project review process, which is new and precedent-setting, not only in this province but on this continent, is good and perhaps even inspirational. I think with some changes as to scale of projects which may or may or not fall under its provisions it's an excellent part of the bill. The remainder of the bill. which is substantially the old B.C. Energy Act. I think needs revision. and I hope it will be revised in significant ways in the next year or two,

MRS. DAILLY: On behalf of the Hon. first member for Vancouver East (Mr. Barrett) I move adjournment of this debate until the next sitting.

Motion approved.

HON. MR. SMITH: May I have leave to make an introduction?

Leave granted.

HON. MR. SMITH: Today I have pleasure in introducing the High Commissioner to Canada from Zambia, Mr. Peter Zuze, along with his second secretary. Mr. Chiyangi, who are here in the gallery. This is the country of Victoria Falls. Lusaka and the Commonwealth conference. Mr. Zuze is a Lieutenant-General in the armed forces of that country, has served in the British air force and is a very, very charming-well-educated man. He's here having a tour o Canada and it is his first visit to British Columbia. I would ask the House to make him welcome.

Hon. Mr. Gardom moved adjournment of the House.

Motion approved.

The House adjourned at 12:09 p.m.