Proceedings in the
Douglas Fir Room

The House in Committee, Section A.

The committee met at 1:37 p.m.

[Sunita Dhir in the chair.]

Committee of the Whole

Bill 31 — Energy Statutes
Amendment Act, 2025
(continued)

The Chair: Good afternoon, Members. I call Committee of the Whole on Bill 31, Energy Statutes Amendment Act, to order.

On clause 2 (continued).

Jeremy Valeriote: So many questions on clause 2. I think I’ll start my time asking the minister to…. It might be easier to start just by laying out…. The goal of this, under the explanatory clause, is to expand the powers of the Lieutenant Governor in Council for the cabinet to make regulations regarding electricity for specific electronic data or the production of hydrogen.

I would like to understand…. I’m looking at the Utilities Commission Act. If the minister could explain why this expansion of power is needed, what the B.C. Utilities Commission already has the power to do in an open and transparent way. I’d like to get a full explanation of what these cabinet powers are needed for and how they are any different from what the minister would be able to ask the Utilities Commission to do under the UCA.

The Chair: Minister.

Hon. Adrian Dix: Thank you very much, hon. Chair. Great to see you in the chair.

I won’t repeat my second reading speech, even though there’s a great audience here today in front of me to hear that. I’ve laid out, I think, in second reading, the reasons for the legislation, but I’ll do, perhaps, a summary of those views just to assist the minister and the committee in why we are proceeding with section 2.

[1:40 p.m.]

Members will know that, in general, there is an electricity allocation system at B.C. Hydro that they are in charge of and have been for years. It’s not and never has been and never would be envisioned a Utilities Commission role, the allocation of electricity. The Utilities Commission role, as defined in the act, is different than that.

Several years ago, with respect to crypto, we saw a rapidly scalable industry that wasn’t creating much value in B.C. but had huge energy demands, and the government instituted — first by regulation and supported by legislation, parallel to what we’re doing today — rules that essentially denied access to electricity for cryptocurrency companies.

There are cryptocurrency companies with electricity contracts today, so it wasn’t made retroactive — about 140 megawatts in the province. Since then, that hasn’t continued. At times, there were projects that were 400-, 500-, 600-megawatt projects of cryptocurrency, for virtually no jobs. Just keep in mind that our largest existing user of electricity in B.C. is Highland Valley Copper, at about 130, just to put that in context.

For us to use our electricity resources in that way didn’t make sense, and we passed legislation in the House similar to this, which was cabinet-directed — a direction to B.C. Hydro, to give them the ability to say no, effectively, to cryptocurrency companies. That position was sustained in the courts, as the member will know, because it was challenged in the courts subsequent to that.

That approach was a cabinet decision around economic policy. How are we going to use our electricity in the province? Would we meet an almost inexhaustible demand for electricity by an industry that didn’t, in our view, contribute much to the province?

There may be a debate about that. Members may disagree with that and think we should be allocating our electricity to cryptocurrency, but in any event, the Legislature passed that legislation. There wasn’t a recorded division, but there wasn’t significant opposition, including from the member’s party, at that time.

That was the same thing. That wasn’t: “We’ll refer this to the BCUC and have them do hearings about cryptocurrency.” If we’d done that, (1) we probably would have had a lot more demand before the door shut, and (2) that’s economic policy. That’s not what the commission’s job is.

We look at rapidly scalable industries like these, where demand can come very quickly at an enormous value and potential cost to ratepayers in and all the members’ constituencies. We look at those industries, AI and data centres in particular — really, there are no projects, effectively, for hydrogen for export now; there’s domestic hydrogen, and things are unchanged for them — and what the contributions are, of jobs and royalties and revenues to the province, of different industries.

Now, we don’t want to say no to AI and to data centres, but we want to have an approach, an allocation framework, that allows B.C. Hydro to set limits and to have, essentially, competitions — you can call them auctions; you can call them request-for-access competitions — for power in B.C. It’s so that we can meet the demand for AI at a level that we can actually meet it with electricity and protect ratepayers and others.

To ensure that we have adequate demand…. You’ve seen this in numerous other jurisdictions across North America. There are, in the literature review I did, at least 24 jurisdictions that have taken action in this area, some of it similar to ours, to deal with this problem.

If people are interested in politics, they saw the New Jersey Governor’s race that was won by the Democratic candidate recently. They’re facing 22 percent electricity rate increases in New Jersey. It’s obviously a different model and different system, but a lot of that was driven by the development of data centres and their impact on residential customers and other industries.

If you look at the issues in Arizona, you see you have 300 megawatts of available power. If you give it to something that’s not creating many jobs, you don’t have it available to other industries that can produce more.

So our approach here is to allow B.C. Hydro to do what it always does but to give B.C. Hydro additional power, through this legislation and regulation. That will allow B.C. Hydro to allocate power, on an annual basis or a per-year basis, to those industries.

[1:45 p.m.]

This isn’t in the legislation per se, but we gave more detail about that. We said that we were expecting an allocation RFP of some sort to take place early in the 2026 year and that that would be 150 megawatts a year for AI — if you did that in a three-year competition, it would be 450 megawatts — and 50 a year for data centres. So we have that.

Then those decisions would be made. This will be the subject of the cabinet regulations, on the basis of B.C. priorities, very much like the priorities set forward by the member from Shuswap earlier, Canadian companies. I’m sure he’ll be supporting this, because he’d be supporting Canadian companies and issues of data sovereignty.

I don’t need to go into this in any detail around the world, but we want to make sure that we have access to electricity for companies. My colleague the Minister of Citizens’ Services is working hard on this question — significant issues of data sovereignty that are facing our province — and we want to make sure that that’s a priority. Requests for electricity that support data sovereignty would be an important aspect of that — and, obviously, economic value, the price to B.C. Hydro and jobs in B.C.

Those are the kinds of considerations that you put forward, and I’d be very happy to hear the suggestion from the hon. member and others about that. This is the role of cabinet: to set economic policy.

It has been the role of B.C. Hydro since its inception to make decisions about the allocation of electricity based on what they can deliver, not just through generation but through transmission and distribution in the system.

That’s their role, and it’s the role of BCUC, as the member knows. They’re currently reviewing the integrated resources plan of B.C. Hydro, to review responsibilities on behalf of ratepayers for B.C. Hydro. It’s not the BCUC’s role to determine economic policy. This is an additional means, which we’ve always had.

There is an allocation framework now, but it’s focused around first come, first served. We’ve said in rapidly scalable areas — where projects such as data centres can be built very quickly and sometimes abandoned very quickly as well — that we have a measure of control, to protect ratepayers and to ensure that B.C.’s outstanding, clean electricity is available for the most job-creating industries that are in the best interests of the province, which has always been B.C. Hydro’s role.

This is a continuation, in a way, of the decision we made around crypto, but it’s also giving opportunity to those industries, which is important, to build out, in a paced way, consistent with our means. I think that that explains a little bit of the regulation.

The member asked about the BCUC, and he’ll know that the BCUC right now, specifically under sections 39 and 59, prohibits delay or discrimination in utilities providing services. This is effectively making such a decision as economic policy of the province, and the BCUC would not be the means to do this. It would fundamentally transform what the BCUC does, and not in a desirable way.

The BCUC does a great job now. It has an outstanding chair, and they’re doing excellent work in these areas. They have major work before them now in the regulation of B.C. Hydro, Fortis and other regulated utilities and, of course, right now with respect to B.C. Hydro, dealing with the integrated resources plan of B.C. Hydro that has just been presented to BCUC.

That’s a nine-minute response to the member’s question.

Jeremy Valeriote: Thank you, Minister. That’s what I was hoping for. That sets the stage. The second reading speech was a long time ago, and my retention isn’t that good.

Since we’re setting economic policy with this bill, I’d like to ask a few questions about that. This government often says it’s supporting emerging sectors — right back to the Premier’s conference yesterday that talked quite a bit about AI. I’m trying to square this. By excluding crypto, AI and hydrogen export, and if you set aside the Port of Prince Rupert, to me, it looks like a lot of this is for extractive industries.

I’m trying to understand how we’re supporting emerging sectors when we’re specifically taking steps to limit electronic data and AI, which effectively freezes the market on that. I’d like to understand: if we’re setting economic policy from the minister’s office, how can the public be satisfied that this is being done in the public interest?

[1:50 p.m.]

Hon. Adrian Dix: Well, I think, just to carry on, there are choices that face governments. I talked about the multiple other jurisdictions that have legislated in this area. The member will be aware of the province of Quebec, where the Minister of Energy essentially has the power of approval, on behalf of the cabinet, for every allocation request above five megawatts. It’s a pretty low standard.

While people who might aspire to be Minister of Energy might see that as a desirable situation, I do not. I think that the role of the cabinet is to set criteria that are in the public interest — after consultation, of course, with First Nations and others. The criteria I’ve described…. I’ve been very straightforward about what I think they are, and in terms of these three industries, they’re in the bill.

You talk about public accountability. This isn’t a BCUC hearing — which, by the way, typically is a debate between lawyers. This is the Legislature, with its elected officials. I didn’t create legislation that said they have the power, by regulation, to deal with industries that they select. I said and defined what the industries were in the legislation, as we did with crypto. That is, I think, a democratic approach.

If we wanted to add other industries…. We can’t do that now because this sets out the scope of the bill, but if we wanted to bring in another bill to add other industries, I’d have to come back to the Legislature to do that. I couldn’t just use the regulatory process to say: “Oh, I’m adding this. I’m adding that.”

That’s, I think, appropriate. It’s appropriate for a cabinet not to be picking winners and losers, and this does not do that. This says very clearly that it will be a process of B.C. Hydro.

It’s similar to other RFP processes we’ve run. I’ll give you an example of the recent calls for power. The government, in discussions with B.C. Hydro, set out some of the parameters of that. We decided that First Nations participation was important. We put forward a minimum of 25 percent participation in those projects and a maximum of 51 percent.

As the member will know, basically, they were all 51 percent, the winning projects. We determined that. We didn’t determine which projects would succeed — some did and some didn’t — but we set out those parameters.

We said, in that case, that the maximum generation would be 200 megawatts, because we wanted them distributed around the province in the first round to create wide opportunities, but also so that there wouldn’t be all the projects in a region, including, say, our colleague from Peace River South’s region. We wouldn’t have all the projects and all the responsibility for generation in a region that produces a lot of energy now and deals with, sometimes, the effects of that, as well, on populations.

Those were the things we went forward with. Once it went forward, and the RFP terms were publicly set in an open and transparent process, with an ethics adviser associated with it, then there was no further role.

We can set those standards. I think we agree, probably the member and I would agree, that reconciliation is a good thing to put in such an RFP and that the issue around the maximum megawatts, which isn’t in the second one, is a good thing to put in an RFP. He’d probably agree that politicians shouldn’t be making the decisions, having set the standard of the economic policy, about which project wins and which project loses, which they do in Quebec. That’s the reason we’ve put the system in place.

When we announced the winning projects in December of 2024…. I’d become minister, and I found out about it, essentially, as we were making the announcement — that B.C. Hydro’s decision on those projects was B.C. Hydro’s decision. And I think that’s the best way to go forward here, to say that this is the amount of electricity we can provide to these industries in a given year and that as we’re providing that amount of electricity, it should be in the public interest.

We should be protecting ratepayers, which it does, but also it should be encouraging other values, including the economic value to B.C. Hydro, which is important, but also other values like addressing data sovereignty. So that’s the reason why we’ve acted in this way, as we did in the case of crypto. This is clearly economic policy of the government.

These industries are quite specific, and this is everywhere in North America. You’d have to close your eyes to what’s going on to think that the rapidly scalable demands of data centres and AI don’t have a profound effect on electricity systems, that they don’t potentially cause brownouts for consumers, that they don’t cause increases in price for consumers. We have to address that, and we have to address industries that are different than mines.

[1:55 p.m.]

Mines have a long lead time for you to prepare and do them, and then they tend to be around for decades. These are different industries, and so giving B.C. Hydro the means to promote them in a paced way but not to have a situation where, in any event, we couldn’t provide the electricity and we’d be making decisions based on who got to the door first…. It wouldn’t be a good idea.

That’s the reason we’ve come forward with the legislation, which I think balances economic development and the public interest, and we’ve proceeded in that way. I think it’s better than other options, including those put forward in Quebec, Manitoba and other jurisdictions, which are struggling with some of the same things. It allows the paced development of important industries like AI and data centres within our means.

I’ll just say this. The only alternative…. We’ve seen this in Alberta, where they opened the doors, briefly, for requests for electricity from data centres. Of course, Alberta already has dramatically higher electricity rates than British Columbia, because they don’t have a publicly owned company, such as B.C. Hydro, in their jurisdiction, in part. They got, I think, in the neighbourhood of 14,000 megawatts of requests, which is more than the peak of the Alberta system.

How do you deal with that? You deal with that by being clear. If we had those requests, we wouldn’t be able to deal with them in any event. This allows us to ensure that B.C. and Canadian companies, in particular — companies that are acting for us in all kinds of areas — are able to get access to electricity in B.C. I think that’s the right approach.

Jeremy Valeriote: I appreciate the minister’s detailing of the arm’s-length process, the arm’s length that the minister would have from a B.C. Hydro process for both supply and demand. I understand that the cabinet isn’t picking winners and losers in terms of projects, but I suggest that the cabinet is picking winning and losing classes of sectors of projects. You’ve alluded to this — namely, crypto and electronic data and hydrogen for export.

I can’t help but feel that that’s being done before the criteria have been set. It feels like we’re putting the cart before the horse.

Would the minister not agree it would make sense, since, as he mentioned, it’s publicly owned, to lay out the criteria — jobs, revenue; we’ll talk about them over the course of the afternoon; reconciliation, data sovereignty, climate — and then use that to determine which classes of projects, let’s call them, make sense to have either rationed or limited?

To me, it feels like we’re doing this on a reactive basis to…. As you said, it’s highly, quickly scalable pieces. There’s nothing in place for another industry that comes along. We’ll have to reconvene here and add something to this bill.

I’m trying to understand why we wouldn’t set the criteria that we all can probably, to a certain extent, agree on, or at least that the cabinet could agree on, and then let that dictate what classes of projects we’re going to limit and ration.

Hon. Adrian Dix: The member is advocating for the Quebec model, and I don’t agree with that.

What I believe is that the Legislature…. We do this consistently. In the discussion of another bill today, brought forward not by the member’s party that’s been in this debate so far but around another bill…. One of the reasons that bill was so significant is that, I believe, as much as possible, you need to put things in legislation. We should say what we mean, and we should have a debate in the Legislature about what we mean.

These rapidly scalable industries, AI and data centres, have huge opportunities for us, but we’ve got to be able to meet that demand, which is rapid demand, in a way that’s consistent with our means and protects the interests of ratepayers.

I haven’t asked for the power to do that and then am determining after the fact that power by regulation. I’m here saying that we’ve done that analysis — and we’ll have that debate this afternoon — and these are the reasons why we’ve chosen these three industries. The criteria that we’re going to apply to these three industries will be set by regulation. I’ve also been straightforward about what I think they’re going to be. We’ll have a process about that that will involve people, but this is straightforward.

The member says we have to come back to the Legislature if we want to change that. You bet we do, because I believe in that. I believe that the Legislature should have this debate about which industries….

[2:00 p.m.]

If I want to say that there should be an allocation framework for AI and for data centres and for hydrogen for export, I should come to the Legislature and we should debate it, just as the member may believe there should be one for other areas, and he may take occasion in this debate to make that case.

I think this is the way you do it. You put that in the legislation, the criteria by which you make the individual decisions…. Data sovereignty, climate, jobs, Canadian content, etc. — that those provisions are rightly in regulation. But I haven’t been hiding what they are either. I’ve been saying in speeches in the Legislature, and I’ll be saying them throughout this afternoon — that response.

I think that’s the right approach — not to give the government regulatory authority in advance and then make decisions about them. I mean, it’s making that analysis and then bringing that to the Legislature for debate.

Members may disagree and say that we should raise electricity rates massively to meet data centre demands. They can make that argument in the Legislature, and I’d be looking forward to that debate. But I’m saying, clearly, what we want to do, which is to have an allocation framework that applies to rapidly scalable industries so that we can give B.C. Hydro the means to manage the electricity grid in the public system and to promote economic growth in B.C.

And that’s why we’ve engaged in this policy, which is consistent with actions taken across North America, with a problem that’s facing us now. Waiting around for that is not what we should do, and so I’m bringing legislation to the Legislature, Bill 31, and we’re having a discussion about it. I think that’s the right way to do things, and that’s what we’re doing.

Jeremy Valeriote: I would like to get back to the selection of these classes and the analysis in a few minutes. But I think I’ll ask a few more broad questions about the clause to you first.

We’ve noted it’s a publicly owned utility. So one of the major priorities is to protect ratepayers. Under this bill the way it’s written, the cabinet can take on rate-setting.

Does the government intend to charge rationed customers more than other industrial customers? And if that is the case, then is there a benefit to ratepayers? If not, are ratepayers not paying the cost of providing this rationed power?

Hon. Adrian Dix: Well, I think that’s an option, which is to make economic return one of the criteria, in addition to the ones we’ve described — data sovereignty, jobs, etc. As the member will know, there is international demand, including for expensive Alberta electricity or expensive Washington state electricity, that would far outstrip our ability to meet it. So having criteria to establish the auction that would include the economic value to the province would be one of the considerations amongst many.

On the call for power, for example, obviously the price of that power is an important consideration — the significant reductions in price we saw for renewable resources, which reflect the international market. Obviously, that’s a consideration and a possibility for B.C. Hydro to do in addition to other criteria. So the answer to that is yes.

Jeremy Valeriote: I’m asking the minister to explain why the cabinet needs to take on the role of rate-setting. If I can find the clause….

“Setting a rate or requiring the commission to set a rate that does any of the following” — section 3(b). This could be done and is regularly done, as I understand, by the BCUC, which has an entire act behind it but, at the very least, has the guidance of just and reasonable rates for industrial customers. The cabinet could instruct the BCUC to change its rate scale for certain industries where we maybe would want to recoup.

Why does the cabinet need to take on this role of rate-setting when it’s already clearly in the hands of the BCUC?

[2:05 p.m.]

Hon. Adrian Dix: Well, we answered the previous question. The UCA currently exists; it prevents discriminatory pricing. That’s the reason the regulation would be put in place, but that’s not the way it works.

B.C. Hydro reviews rate increases; B.C. Hydro proposes them. That has been the case forever; that has been the case in the last number of years and, really, since the BCUC was created in the 1980s: B.C. Hydro proposes, and the BCUC reviews. So it’s B.C. Hydro and, effectively, the government that’s responsible for those rate increases.

When we have a rate increase proposal come forward, it’s my responsibility, in the House, to defend this rate increase to members of the House. B.C. Hydro’s responsibility is to defend it to the public and before the BCUC and to explain the various reasons. When last year, for example, Site C came online, that increased rates. In B.C. it just does, and you have to.

When I’m explaining the rate increase, that’s one of the elements of the rate increase that I’m explaining. It’s not BCUC that decides what the rate increase application is. They adjudicate on those questions, on the applications made to them, but B.C. Hydro sets the rates.

This is just providing B.C. Hydro with the authority, contrary to existing provisions of the UCA, which I described earlier — in its criteria for deciding the winners of the auction or the competition you’d have for access to electricity — to be able to make decisions around, potentially, rates that are higher, if you were to bid for that. It wouldn’t just be that, but it would be a criterion.

We wouldn’t want it to be a highest-bidder race. We want to have it be in the economic interests of B.C. That’s why they’re in place, and that’s why there would be other criteria as well.

Jeremy Valeriote: I’m trying to understand (3)(b)(ii). Rather than directing B.C. Hydro, the public utility, to establish the criteria, this is saying that it’ll be the Lieutenant Governor in Council that establishes criteria or rules for conducting the competitive process.

Given what the minister has just said, I’m trying to understand why that would need to fall to the cabinet, when he just said it’s a B.C. Hydro process and a B.C. Hydro competition.

Hon. Adrian Dix: As I’ve noted, we’re enabling the auction process. This is a cabinet regulation to enable the auction process that would be put in place by B.C. Hydro to include, for example, issues of minimum price, as well as other considerations, like the criteria we’ve already discussed. That’s what the cabinet has the authority to do.

Then it would be B.C. Hydro’s responsibility to initiate the RFP or whatever you call it, the open process that would take place, with clear rules established, including the criteria laid out by cabinet, and then to make decisions on access to supply.

Jeremy Valeriote: I will move on to a different section of the UCA. Section 59 says the rates must not be unduly discriminatory. How does this act get around that rule under the UCA? This would be a discriminatory approach to rate-setting for these particular sectors. How does that override that section?

Hon. Adrian Dix: What these provisions allow B.C. Hydro to do…. We’ve noted the other provisions of the UCA that apply, and this is why this is an economic approach of government and a direction of government to B.C. Hydro. This allows them to supersede that in order to make, as part of the competition — whether we call it an RFP, a competition or an auction, we’ll understand this — price be a consideration.

[2:10 p.m.]

That’s the purpose of it and why we have to give B.C. Hydro the authority to do that. These means, these regulations and this legislation give B.C. Hydro that authority.

Jeremy Valeriote: Before I hand it over to my opposition colleagues, I’ll go back to the economic policy piece. I understand there’s some analysis and some continental information around the data centres and AI. Obviously, the cryptocurrency was dealt with last year.

I have an amendment that I would like to propose. I propose an amendment. May I speak to it?

The Chair: Yes, please.

Jeremy Valeriote: Thank you.

We’ve heard that the certain classes of industries will be rationed or limited because the Legislature and cabinet sets economic policy. I would suggest that given…. I’m not going to quibble with the direction of some of this electricity, to liquefying natural gas or methane, because I would agree that is not part of this bill.

However, given the government has been quite clear about how it feels about new oil and dilated bitumen pipelines, specifically to the north coast — and there’s quite a bit of public resistance to a bitumen pipeline to the north coast — I would suggest that, given our role as elected officials, it would make sense to add that as a class of industry that we would want to limit or exclude from provision of electricity. Probably not the same demand as, perhaps, electronic data or AI, but we don’t know that.

It does seem to be in line with the government’s economic policy, if I may interpret it, to support LNG but not diluted bitumen and to continue to support the tanker ban. The Premier and others, and even the minister, I think, have been quite vocal about that.

So I’ll put forward this amendment, and I’ll just suggest that it does entirely fall within the scope of the bill, because we’re identifying classes of industries here that we want to regulate. It’s well within the principle of the bill, which is to select certain classes of industries that we want to have more say over how much power they get. I’ll sign this and submit it.

It would be to add to the current list — which is cryptocurrency, electronic data, including data used for artificial intelligence, produce hydrogen for use outside Canada — another section.

[CLAUSE 2, in proposed section 21.1 (2), by deleting the text shown as struck out and adding the underlined text as shown:

(2)The Lieutenant Governor in Council may make regulations respecting the provision by a public utility of electricity service for any of the following purposes:

(a)to mine cryptocurrency;

(b)to store or process electronic data, including electronic data used for artificial intelligence;

(c)to produce hydrogen for use outside Canada.;

(d)to extract, transport or process oil or diluted bitumen.]

The Chair: Thank you, Member. The committee will now take a short recess for the Chair to review the amendment and make copies for all members.

The committee recessed from 2:13 p.m. to 2:22 p.m.

[Sunita Dhir in the chair.]

The Chair: Thank you, Members. I call the committee back to order, and we are debating the amendment to clause 2.

Do we have any speakers? Does anybody want to raise a point of order to this amendment?

On the amendment.

Hon. Adrian Dix: Well, obviously it is the role of the Chair to rule on amendments. I’ll just say that this amendment is plainly beyond the scope of the bill. It was very specific at second reading debate about what was involved and what wasn’t. We could add any number of industries to that, and that would be beyond the scope of the bill.

It’s absolutely legitimate for the member to raise the point, as it was for the member from Shuswap who asked questions about “Canadian,” the use of Canadian products on transmission. Although it was beyond the scope, it was still a legitimate question, just as it is for the leader of the Green Party to ask questions about why these particular areas were chosen in the legislation.

But this is the legislation passed at second reading, and obviously, to add other industries to it is significantly beyond the scope, straightforwardly.

I would suggest that the Chair so rule, but I’m, of course, respectful of the Chair’s role and the Table’s role.

Jeremy Valeriote: I’ll just suggest that the scope of the bill is to identify certain industries for rationing or limiting or exclusion, and this is an industry that is under that list.

[2:25 p.m.]

I also suggest that, given I didn’t hear the Chair rule this out of order and asked for debate on the amendment, we proceed.

Point of Order

Hon. Adrian Dix: A point of order. Before we have a debate on an amendment, we need a ruling as to whether the amendment is in order. That would not be, as the Chair and the Clerk would know, appropriate to have a debate about an amendment that, to my mind, and this will be a decision for the Chair, is clearly out of order.

I think we rule whether the amendment is in order. Should the Chair rule that the amendment is in order, then we’d have a debate. If we don’t, there will be other ways to address the same issue within the debate that the member wants to raise.

The Chair: We can hear the member for Peace River South on this point of order.

Larry Neufeld: On the point of order or on the amendment?

The Chair: On the point of order.

Larry Neufeld: I don’t have a comment on the point of order.

The Chair: If we don’t have anybody speaking on that, we will recognize the….

Thank you, Members. This point of order is not clearly out of the scope, outside of the scope, and if we do not have any other speakers, we will continue to debate the amendment.

Debate Continued

Larry Neufeld: With respect to the amendment to clause 2, section 21.1(2), my colleague and I have had a very good discussion offline here as far as we agreed to disagree on a number of things, and this certainly would be one of them.

To exclude electricity from being used to extract, transport or process oil or diluted bitumen, in my opinion, would be contrary to what the government has stated as far as utilizing electricity at every avenue possible to reduce carbon impact or carbon footprint when it comes to the hydrocarbon industry.

For that reason, I would not be able to support this amendment.

Hon. Adrian Dix: What we have is legislation here that addresses specific areas for an allocation framework. The suggestion that there be an allocation framework for any number of other industries can be made, but that’s not what we passed at second reading here.

Whether there would be an explicitly allocated amount of energy for proposals…. I mean, there are, for example, oil pipelines throughout British Columbia which would benefit from being electrified. We would need those. They exist. They allow our society to run in a certain sort of way. To have a framework for that is conceivable but not really desirable.

With respect to the bitumen pipeline, the government is, as you know, opposed to that, opposed to lifting the oil tanker ban in the House. But establishing an allocation framework for it isn’t the way to go about that.

We’re pretty clear about the issue of a northern pipeline and therefore would not be supporting this amendment because it wouldn’t be appropriate in this legislation. We might, in fact, send the opposite message, that we’d be applying a certain amount of electricity in an allocation framework for that industry.

[2:30 p.m.]

We’ve said pretty clearly that we think the allocation framework should apply to these specific industries. That means that we would pace development in those industries. That’s its intent, and that’s what we’re doing.

I don’t think that’s really the intent of the hon. member. That wouldn’t be the intent of its involvement in the law, anyway. In any event, it’s contrary, and it’s well beyond the scope of the legislation. So I ask members not to support the amendment.

Jeremy Valeriote: We’re setting economic policy, and we’re also, as I understand it, setting highest and best use for what is essentially public electricity. Regardless of whether a member supports this particular industry or not, it is incumbent on us — the highest and best use.

This is a new project that would…. The only new project that I’m aware of that’s being discussed is a north coast bitumen pipeline to where there’s a tanker ban. If we’re talking about setting an economic policy and the highest and best use of B.C. Hydro generation electricity, then this would seem to be entirely consistent with that.

If it’s not, then it would need to fit into some kind of criteria or framework to determine that. We don’t have that. All we have is three sort of, I will say, subjectively specified industries, because I haven’t seen the objective. But we know they’re fast-paced, and they suck up a lot of electricity, so we put them on a list. Maybe a diluted bitumen pipeline isn’t fast-paced, but it certainly could use a lot of electricity, and it doesn’t fit with our economic policy.

So regardless of whether a member feels that a northern-gateway-type pipeline should get B.C. Hydro electricity or is in support or not in support of the oil industry, there has to be some acknowledgement that we need to do this for the highest and best use.

To me, this fits entirely within the list of industries, and I would urge members to support it.

Hon. Adrian Dix: We passed the bill at second reading. The bill is to provide, essentially, that private allocation framework to three specific industries. Maybe the members could ask, and I’m sure the member will ask, why these three, and why not others, whether an allocation framework would be appropriate for other industries.

There are specific reasons that we’ve provided in public documents and we’ll provide in this debate as to why they were selected with respect to a particular project in the North for which there’s no proponent and no proposal. That’s not in that category, first of all. Secondly, this isn’t really a debate about whether we should have an allocation framework about AI and about data centres, about hydrogen for export — not the place for a pipeline debate.

My position on the pipeline is absolutely clear, but this would not help in that process. In fact, it might have the opposite effect, and that’s why I’m asking members to defeat the amendment.

David Williams: Just my two cents is the fact that unfortunately, I can’t support this amendment. I don’t believe restricting or allocating any industry is a good thing. I think that every bit of electricity…. If anything, we should be trying to get more electricity rather than restricting or allocating electricity. I also believe that every proponent or any project or industry should be based on the merit of what they’re trying to do.

So, unfortunately, in this case, it’s restricting an industry or a proponent, even though there might not be a proponent at the current time, but we don’t know unintended consequences down the future. So in this case, unfortunately, I cannot support this amendment.

The Chair: Seeing no further questions, the question is the amendment to clause 2.

A Voice: Division.

[2:35 p.m. - 2:45 p.m.]

The Chair: Before putting the question, I remind all the members that only the members of Section A or their duly appointed substitutes are authorized to vote.

The question is on the amendment to clause 2 moved by the Leader of the Third Party.

Amended defeated on the following division:

YEAS — 1
	Valeriote
NAYS — 8
Routledge	Sunner	Lajeunesse
Dix	Gibson	L. Neufeld
Mok		Williams

The Chair: We will move to the next clause, but we’ll wait for the staff to come back. We will wait for the minister’s staff to come back. We will take a short pause.

Larry Neufeld: Similar to my colleague to my right, I too have an amendment to clause 2, section 21.1. I’ll submit the amendment, and then we’ll have a chance to discuss it, and I’ll explain it.

The Chair: Member, do you have any comments to make on the amendment?

Larry Neufeld: Yes, I do. With respect to this particular section, my concern in that case was that by instilling in this legislation the eliminating as the processing of electronic data, including artificial intelligence….

I did hear and I understand and I appreciate, very much so, what the minister said about the need to have the ability to not cause brownouts or to cause shortages in other areas.

My concerns are that by instilling this in a law, we set ourselves up to the point where investment, or opportunities for investment, are going to be looking, and my fear is that an industry that we want, ultimately, or I believe we want, is going to be…. It’s going to affect investment decisions.

The Chair: We will take a short recess to make copies of the amendment. Five minutes. We will take a short break for five minutes to make copies of the amendment.

The committee recessed from 2:49 p.m. to 2:58 p.m.

[Sunita Dhir in the chair.]

The Chair: Members, I’ll call the committee back to order.

We are debating the amendment to clause 2, moved by the member for Peace River South.

[CLAUSE 2, in proposed section 21.1 (2) by deleting the text shown as struck out and adding the underlined text as shown:

(2)The Lieutenant Governor in Council may make regulations respecting the provision by a public utility of electricity service for any of the following purposes:

(a)to mine cryptocurrency;

(b)to store or process electronic data, including electronic data used for artificial intelligence;

(c)(b) to produce hydrogen for use outside Canada.]

On the amendment.

Hon. Adrian Dix: The amendment, of course, effectively, even though it selects this part of the section, nullifies the impact of the whole section. That’s its intent, as the member knows. We’ve had this discussion. There really won’t be an allocation requirement at the moment for hydrogen for export because there are, essentially, no projects. There’s currently a ban on cryptocurrency mining, which we’ve discussed extensively in the committee.

What he’s proposing is to eliminate the capacity to have an allocation framework for data centres and for artificial intelligence, and that’s of course the purpose of this section of the bill. The bill includes statutes in a number of areas. I’ve given, I think, detailed explanations to the House and to the committee about the value of the legislation.

I won’t go through all of that again, except to say: the member talks about uncertainty. What this does is create certainty, certainty for AI and data. They’ll know clearly what the rules are and access them. There are currently 1,400 megawatts of requests, in the early stages, before B.C. Hydro. There are thousands more, if we were to open up the process, with uncertainty for all other industries, because potential power would be taken away from them, and uncertainty for ratepayers.

I don’t think ratepayers in Dawson Creek, any more than in Vancouver-Renfrew, want to pay massive electricity rate increases. Instead, as the member does and as I do, they want to promote these industries that are consistent with maintaining a strong public utility and low electricity prices.

[3:00 p.m.]

The reason we’re doing this is to give priority to the best projects for AI and data centres — ones that are in the Canadian interest, ones that are consistent with the member from Shuswap’s previous amendment, allowing us to not allocate electricity on a first-come, first-served basis in areas that are rapidly scalable, have huge potential demand and are currently destabilizing electricity systems everywhere else. This is the opposite of certainty.

What we’re providing with this legislation is clarity and certainty for the system. It allows us to grow industries to create the most jobs in our province, to have and to grow AI and data centres, consistent with the economic interests of the province of British Columbia, and to protect ratepayers. I don’t think the passage of this legislation and the kind of unfettered access that members are talking about over there would be appreciated by people who are facing real issues of affordability in our communities now.

Of course I’m opposed to this amendment, which effectively nullifies the legislation, although it only takes one part of the subsection and is therefore in order. I would strongly encourage the committee to say no to this, in the interest of jobs in B.C., certainty for industries and economic development; no to this, based on the climate and the needs of the climate; no to this, for all those reasons; and to reject the amendment.

Larry Neufeld: Thank you to the minister for his cogent argument. I’m not going to add anything to what I previously said. I did have a thought there, but I just want to thank the minister for his comments, and I’ll put it to the Chair.

Jeremy Valeriote: I’m seriously considering this amendment, not because I don’t accept the minister’s argument that this fast-moving industry needs to be limited or it could take up all the public electricity you have.

I know it will sound a bit like a broken record because I haven’t seen anything — maybe that can be a question that comes up — in the technical briefing, in the second reading debate or in any backgrounder, to lay it out with all the other industries that need public electricity and say: “This one fails because it produces zero jobs or two jobs; it fails on climate, it fails on data sovereignty, and it fails on reconciliation.”

I don’t see that. All I see is we’ve decided that electronic data and AI are dangerous, and we’re going to limit them to 150 megawatts. To me it would make a whole lot more sense to lay it out for the public, given it’s a public utility, and say: “These are the criteria. This is the weighting of the criteria. We’re going to send it to B.C. Hydro. B.C. Hydro will make that decision, and they will limit as they see fit.”

Instead, we’re handpicking one or two industries. To me, it doesn’t hold water when it comes to objective public decision-making.

Hon. Adrian Dix: Well, I’d just say to the member that he can have it his way, but he can’t have it both ways. We’re here in the Legislature debating this, as we should. It’s important public policy. All across North America, these issues are significant for people, for ratepayers and for the climate. We have laid forward the case in multiple discussions at second reading, and we will in committee.

I’m sure there’ll be many questions over why we’ve done this — why, in every jurisdiction in North America, this is an issue, and why multiple jurisdictions like ours have passed laws. We could have done what, apparently, the member wants, which is to create enabling legislation and decide that later by regulation.

We’re coming to the Legislature and doing this. We are not saying these are industries that are bad, but we’re saying that we need to pace these industries, consistent with the demand for electricity, to allow other industries to develop, and to protect the interests of ratepayers. Every jurisdiction in North America is dealing with and struggling with these very questions.

Some jurisdictions, such as Utah, go about it a certain way, effectively relieving from utilities the right to have to service such industries. Other jurisdictions, such as Quebec, allow the cabinet to decide on every project over five megawatts. Other jurisdictions, like Manitoba, take a slightly different but more cabinet-centred approach. What we’ve done is come to the Legislature and have a debate here. That is the most transparent thing you can do.

[3:05 p.m.]

We’ve highlighted the industries in question that we think would be assisted by an allocation framework — not that the industries are bad but that in the provision of electricity, we have to pace them out consistent with our needs and our direction but also with our capacity to do that.

If the member is suggesting we shouldn’t do that and that we should import, I don’t know, fossil fuels in the province to run data centres, I disagree with that suggestion. I don’t think that’s what the suggestion is, and I’m not saying that’s what it is.

I’m saying that this legislation is good legislation, consistent with supporting a strong B.C. Hydro. If the member has questions about the selection of these things and why not other things, of course, as he is well aware, I’m absolutely prepared to answer those questions.

At this stage, we’re on legislation that they’ve supported at second reading and that has come here. To say that this section of the legislation shouldn’t apply to what is practically the only thing it applies to, in creating an allocation framework….

I understand the opposition’s position. They’re saying that the AI industry, effectively in data centres, should have primacy over other interests, including and especially ratepayers. I don’t agree with that. This is an open debate. Other jurisdictions have gone that route, and they’re paying the consequences of those policies now.

This is a strategy based on the best information about those jurisdictions. How to handle a situation where you have thousands, even tens of thousands of megawatts of demand and a limited amount of electricity to apply to it. Should we do it on a first-come, first-served basis, so that the first person who gets in the door gets it, no matter what the public interest is? Well, I say no, and I hope the member will agree with me and vote against the amendment.

Jeremy Valeriote: I just want to ask the minister a hypothetical. Suppose a year from now B.C. Hydro gets a proposal from a data centre for, say, 500 megawatts, well beyond the limit of what has been said. They promise 6,000 jobs, and they promise to pay three times the going rate for electricity, which relieves the burden on ratepayers. They say they’ll recycle water, and it’ll have no climate impacts.

Let’s say that happens between when the House adjourns in May and we reconvene in October. Is the minister saying we need to come back, change this legislation in that time to be able to accept that proposal? And why would we hamstring ourselves like that, instead of setting criteria in advance that B.C. Hydro could administer?

Hon. Adrian Dix: We are setting the criteria in advance, and I’m explaining what they’ll be. If the member’s talking about 500 megawatts of electricity, the member will know that we don’t build multiple Site Cs in that period of time. We’d have to consider all those circumstances.

We’re dealing with reality here, and I would say that that is a fantasy in terms of jobs and everything else. That’s not what the data centres do. They have real value, and we’re encouraging them. We have data centres in B.C., and it’s important for us to have the capacity of more data centres, for example, to ensure that we have sovereignty of our data.

There are significant issues in the United States now and changing policies about access to data by U.S. companies in foreign jurisdictions. We can name what some of those companies are; we know what they are. With the ability to take action now, to proceed and have an open competition to do that, it’s not a cabinet-decided competition, but one where we set the criteria that we see. We’ve laid out the industries.

On the overall question of whether we should come back to the Legislature, if we’re going to expand this to other categories, I say yes. I say we should come back to the Legislature, because I believe in the Legislature. I think, as I say, you can have it your way; you can’t have it both ways. We believe in a legislative debate on these issues.

I think a lot of the member’s other criticism from his second reading speech, which I obviously read in detail, were about enhancing the power of cabinet. Well, this is enhancing the power of the Legislature. We’re here having a debate on an important public policy issue that I passionately believe is the right thing to do for the people of our province — for its jobs, for its climate, for its electricity sector and, most particularly, for ratepayers.

[3:10 p.m.]

This hasn’t happened by accident. Other jurisdictions, dozens of them, have come forward with this legislation. To do nothing at this crucial time for our province and our country, to do nothing in these areas, would not be the right path for B.C., in my view.

The Chair: Seeing no further questions, the question is the amendment to clause 2. Shall the amendment pass?

Division has been called.

[3:15 p.m.]

Members, is anyone opposed to waiving the time?

Leave granted.

[3:20 p.m.]

The Chair: Before putting the question, I remind all members that only the members of Section A or their duly appointed substitutes are authorized to vote.

The question is on the amendment to clause 2 moved by the member for Peace River South.

Amendment negatived on the following division:

YEAS — 3
L. Neufeld	Mok	Williams
NAYS — 6
Routledge	Sunner	Lajeunesse
Dix	Gibson	Valeriote

The Chair: We’ll take a recess now, Members.

The committee recessed from 3:21 p.m. to 3:38 p.m.

[Sunita Dhir in the chair.]

The Chair: I call Committee of the Whole on Bill 31, Energy Statutes Amendment Act, 2025, back to order. We are on clause 2.

Ward Stamer: Great to be here. I have a couple of questions to the minister. Just trying to ascertain on some of the language….

At the beginning, in 21.1, it talks about: with limited subsection (2), the Lieutenant Governor can prohibit, for a specific period or indefinitely — or, I would guess, not at all — for a listed purpose on the three industries that were listed in this clause.

Can the minister explain a little bit when, if we’re going to be changing the regulations to allow cabinet to set the rates on those set industries, if that’s correct…. On section 5, it talks about referring back to the Utilities Commission, 1996, which has been revised a few times. It talks about subsection (3) on the rate structure.

[3:40 p.m.]

Can the minister explain to me what the cabinet is going to be able to use when it comes to determining these rates? That’s kind of what I think he was alluding to, that cabinet will have the opportunity to set the rates on these industries. Maybe the minister has more that he can share on that particular question.

Hon. Adrian Dix: As has been discussed in my earlier answer to this question, what is being established here is an allocation framework for electricity in these sectors. Part of that allocation framework is that B.C. Hydro will be holding some form of…. Call it a competition, an auction, a request for expression of a request for power of process. The cabinet will enable that through regulations setting criteria, such as the ones we’ve discussed earlier, and potentially the criteria for price.

For example, you could set a criteria at the marginal cost of power, and that’s what B.C. Hydro is enabled to do. It means that in the competition, the potential people seeking electricity from B.C. Hydro in these sectors…. They’ll just say: “We’re doing this for data sovereignty, and” — potentially — “here’s the price we’re prepared to pay for the power.” And this enables that possibility. Cabinet isn’t setting the price in that sense.

Typically, on overall rates in B.C. Hydro, they’re what we’d call non-discriminatory, meaning that you’re applying postage-stamp rates everywhere. In this case, we’d have an allocation competition, and one of the factors of that would be the return to B.C. Hydro and the return of value to the province. So it enables that.

It’s not a question of cabinet setting the rates. It’s creating…. We’re establishing legislation in these three industries — not other ones, these three. So it’s limited. This is a decision that the Legislature has made at second reading and is making now. And then cabinet is establishing the criteria by which B.C. Hydro would set up that allocation framework process for companies in these sectors to see access to incremental electricity.

Ward Stamer: Thank you to the minister for the answer.

But again, when he talks about allowing the flexibility of the cabinet to determine whether there’s going to be electricity provided to these three industries, because that’s what this allows…. It doesn’t say that it’s going to be prohibited forever. It allows, in the subsection — and correct me if I’m wrong — that cabinet can change those parameters. But when it goes back to a rate set under subsection (3), as in section 58, part of it also determines how you set those rates.

Again, the minister is mentioning auctioning, but at the same time, we have a system in place where B.C. Hydro has formulas that determine one of the revenue-cost ratios on how much it costs to put something together and how much it’s going to cost to bring that electricity to market.

Through the Utilities Commission, there are set rules on how those rates are applied. And in part of those sections, in section 58 and section 59, it talks about what’s reasonable and what’s unreasonable to ratepayers. So if cabinet can now all of a sudden determine, in these three industries, if there’s going to be access to power, where is the rate structure in determining, other than the auction to get the power in the first place…?

If there are going to be any increases to power, what is the rate structure? Are we going to be having to add section 59 along with 58 so that we’re following the same rules in the Utilities Commission of 1996, so that we talk about everything between reasonable rates, whether we want to talk about discrepancies? Do we want to talk about, in 59, when it talks about discrimination, where there are specific paragraphs that say you cannot give undue compensation or relief to any other groups? It has to be even across the board.

[3:45 p.m.]

So is that something that we should be adding to this bill so that we put the parameters in place, so that cabinet has to follow the same rules as what B.C. Hydro has to follow right now with the Utilities Commission and through the regulations that are already in place?

Hon. Adrian Dix: Our system is that everyone else plays by the same rules. We’re creating an allocation framework for these three industries. It gives the potential to set the floor price.

The member said that the Utilities Commission sets the rates. Hydro makes application for rate increases to the Utilities Commission. That’s the distinction I’d make there. This is one of the things we’re discussing here.

Cabinet is providing direction for the creation of an allocation framework. It’s limited to doing it for these three industries based on the fact that they’ve come to the Legislature, these three groups plus crypto, which is currently the legislative basis for the crypto ban on access to electricity in B.C. This allows price to be considered in that process, in that auction process for these three industries.

Otherwise, as the member describes, the rules are equivalent throughout B.C.

Ward Stamer: Thanks for that explanation from the minister.

But to add to that, as well, in the same scope is that part of the regulations, when it talks about, in clause 2, hydrogen and it talks about selling in Canada, it doesn’t specify exactly what the parameters are in meeting those, the language in the bill. It’s up to interpretation, because it doesn’t specifically say if it all has to be produced for Canada or export or any of those kinds of things. It doesn’t specifically say that.

But again, when we go back to the rates…. The minister said earlier today about being open and transparent when it comes to costing…. If we’re not going to be using some of the revenue-cost ratios that we’ve used in the past…. We’ve all seen cost overruns in multiple generation scenarios in this province. Site C went almost double over what it was originally targeted for.

Some of these new projects that have been proposed — we still haven’t seen the numbers on exactly what amount of power is going to be produced for how much it’s going to cost. There’ve been assumptions on how much power, for example, wind has been proposed for, yet we don’t know what those end numbers are.

No different than Site C. I mean, Site C was originally designed for 7,100 megawatts. B.C. Hydro keeps saying that it’s going to be on target for 5,500 megawatts. I believe, from what I’ve heard, it hasn’t even exceeded 4,000 megawatts. That obviously is going to add an additional cost to the costing structure.

I’m just curious. Again, is there going to be a framework so that, as the minister alluded to…? He says, yes, the Utilities Commission doesn’t set the rates as much as B.C. Hydro has to justify what those increases are going to be, and they have to be, again, reasonable according to the rules in the Utilities Commission Act.

Otherwise, if B.C. Hydro all of a sudden said, “Okay, we’re going to charge 15 percent even though it’s less than Edmonton,” well, we can argue that that would still be unreasonable because the increases have only been 2 or 3 percent per year or the cost of living.

Are we going to have those same parameters as we go forward with this if all of a sudden the minister decides that, yes, we’re going to be able to produce hydrogen in this province? We know it’s going to be a tremendous drag on our power consumption. I mean, there were numbers of anywhere between 800 and 1,000 megawatts for the proposal that was up north just a little short time ago.

What assurances do we have that there won’t be cabinet just making arbitrary decisions on what these rates should be?

Hon. Adrian Dix: The member will know from my time in opposition that I had lots of questions in this very room about contracts with respect to Site C at that time. But let’s be clear about B.C. Hydro. Third-lowest electricity prices in North America since this government came to office, including the rate increases that are happening this year and next, 12 percent below the rate of inflation.

[3:50 p.m.]

B.C. Hydro does an outstanding job on rates. Why? Because it’s a publicly owned utility. It’s why we’re 60 percent below Edmonton, 25 percent below Seattle, 40 percent below Portland, 250 percent below New York, and so on. It’s why we have the lowest electricity rates in the world, with Manitoba and Quebec, the other hydro systems. It’s because we have a public hydro system, because of the work of people of previous generations who built this province and built B.C. Hydro. I’m pretty proud of that.

This doesn’t change that in any respect. What it does is ensure, in fact, that ratepayers are more secure by ensuring that these fast-scaling industries that have significant demands for power have that power allocated in a paced way and that we have a fair competition for access to that power. That obviously benefits in priority Canadian companies, as the member for Shuswap recognized earlier as an important value, but also issues of data sovereignty. We have to, in some cases, ensure that the data that is the property of people in Canada stays in Canada now, in the current context. This is an issue my colleague the Minister of Citizens’ Services is addressing — and jobs here and the benefit to B.C. Hydro and ratepayers.

This is enabling the creation of the allocation framework. That’s what it is. And it’s for — and we’ve laid out for people just so that they know what we’re doing and clearly — 150 megawatts a year for AI. So if you did a two-year call at the beginning — because it takes a while for projects to come together, although this is a much more fascinating scaling sector — you’d have 300 in two years, or if you did it for three years, 450 for three years.

Just to put all of that in context how much power that is, the largest demand now, as the member well knows, is at Highland Valley Copper, and that’s probably around 120, 130. So that’s a lot of power. And if you add that 150 for data, we’re just saying: “This is what we can manage, and let’s do it in the best interests of the public and get the maximum return for the people of B.C. on it.”

And the broader issue of rates is an important question for B.C. I think B.C.’s record speaks for itself over generations, which is that B.C. Hydro, well, we invested incredibly at times. And that had impacts on rates when we built the dams in the Peace and Columbia. Of course it did. We were building them out.

But because of that heritage system, we do very well on rates and have amongst the lowest in the world. Maybe in Saudi Arabia, if you looked at it in a very different model, the rate might be lower, but other than that…. We have low, clean electricity in B.C., and that will continue.

Ward Stamer: I thank the minister for his optimism on B.C. Hydro. Yes, I share the same feelings with B.C. Hydro. My grandfather was in power generation for almost his entire career in Revelstoke, and I’m acutely aware of the opportunities with hydroelectric.

But I’m also aware that B.C. Hydro and the government overruled some of the rate increases that were originally projected because of, probably, the politics of the day. The minister can maybe correct me if I’m wrong, but we are still importing in the tune of half a billion dollars worth of electricity to this province. When we look at some of our targets in the next five to ten years, I would think the minister would agree with me that that’s why these calls of power have been coming out because there’s a pretty good indication that we will not have enough self-sufficiency and power in this province.

Going forward, we have deep concerns on this side of the House when it comes to rates. Because again, if we’re not going to be able to see all the costing on all these projects and we start having cost overruns, as have occurred in the past, what formulas are we going to be following in some of these things? In regards to even some of the special drains on these three targeted industries…. Will that negatively impact our public if the math is wrong and all of a sudden we’re going to have to charge more and outside the parameters that were originally identified?

So are we going to be using scales like the revenue-cost ratios, or are we just going to be making stuff up, or are we constantly just going to be looking at other jurisdictions saying: “Well, we’re still a little bit cheaper than Edmonton, so we should be okay”?

I’m asking straight out. Are we going to be able to have straight rate structures when it comes to having flexibility with these orders in council when we have cabinet decisions, when we have B.C. Hydro…? We can argue it has a committee that hasn’t sat for 15 years. There’s really not a lot of public oversight. It’s government oversight, and it’s the government in power.

[3:55 p.m.]

So what assurances do we have that these costs will not spiral out of control and our rates won’t as well?

Hon. Adrian Dix: Well, I’m always enthusiastic, and I think members of this House know this. I’m always prepared to have an estimates debate. That would be great. Perhaps we could set a time outside the legislative session to have it, but we are on clause 2 of Bill 31.

I like to have free-wheeling debate. I think it’s good for the Legislature. It’s why we’ve been having debate that’s sometimes outside the scope of the legislation. I think that’s a good thing in general, as long as we don’t do it the whole time because we’ve got a bill and we’ve got business to work on.

I would say, in terms of imports and exports of electricity, over the last 15 years, B.C. Hydro has imported more electricity in seven of those 15 years than it’s exported, and in eight of those years, it’s exported more than it’s imported. Typically in drought years, we like to build up the reservoirs, and we import more. In other years, we export more. B.C. Hydro is in a good position in that regard.

But what is always true, and I’ve said this earlier — and I’ll just refer, on a lot of the historic questions, to my discussion with the member from Kelowna of yesterday, where we talked about the recent demand for power and the impact of conservation measures like LED lighting and the impact of demand in the forest sector, which, as the member knows, has declined significantly over time; that’s just a fact, and we’ve laid that out — is that what we’re seeing at B.C. Hydro is more valuable power being exported than imported.

The outstanding people at Powerex — I know that members of the opposition have visited Powerex, and they know when I talk about it, and I’m sure the member does, from his experience at B.C. Hydro — do a brilliant job in marketing British Columbia in the United States and in neighbouring provinces such as Alberta. Last year, even though we imported more power than we exported, we made $600 million in the proposition from Powerex.

That’s because we have a richly flexible system that allows us to use power — it’s stored behind the dam — when it’s most valuable and sell it when it’s most valuable and sometimes import it when it isn’t, including importing from power that we have access to under the downstream benefits.

All of that is the general discussion from his estimates question. I wanted to give his estimates question due respect. But I also think that this has been the achievement of B.C. Hydro, 12 percent below the rate of inflation in incredibly inflationary times over the last ten years. I’m not saying there aren’t other high-cost issues in B.C., from housing to everything else. We all know that. B.C. Hydro has been one that has weighed in on the other side.

Now, between 2001 and 2017, hydro rates increased 54 percent above the rate of inflation in that period of governance in B.C. Again, we’re not having an estimates debate, so I will not pursue that any further. I’ll just leave that for the member to consider.

I think what this legislation does is really allow B.C. Hydro to do what it should do, which is act in the public interest of B.C., and ensure we have the electricity for industries that are producing the most jobs, ensuring paced growth in these sectors and managing issues just like all these other jurisdictions, which are dealing with some of the same things. An insatiable short-term demand…. We don’t know what the long-term demand will be.

I remember reading stories in 2000 about the internet and how it was going to take up all the electricity and everything else. That didn’t prove to happen in the same way. Industries such as AI and data centres inevitably, I think, will become more efficient in terms of their use of electricity. But now the demand is extraordinary, such that Alberta received, when it opened up requests, 14,000 more than the entire hydro, their whole system of requests for electricity.

All of those things are there, and I would recommend, because I think this is the right approach on section 2 that we’re taking, that this section is supportive of ratepayers, is supportive of a paced economic development in these precise sectors and ensures access to power for sectors that produce more jobs, more royalties and more revenue.

Jeremy Valeriote: Following on the line of questioning from my colleague from Kamloops–North Thompson, I’d like to propose an amendment.

[CLAUSE 2, in proposed section 21.1 (3) (b), by deleting the text shown as struck out:

(b)setting a rate, or requiring the commission to set a rate, that does any of the following: .]

May I speak to it briefly?

[4:00 p.m.]

The Chair: Yes, Member, you can speak.

On the amendment.

Jeremy Valeriote: I’ve listened to the discussion about who sets rates and how they get set and what the considerations are. In this legislation, 21.1 of the Utilities Commission Act, (3)(b) basically refers back to cabinet setting a rate or requiring the commission to set a rate that does any of the following: establishes charges to be paid, establishes limits on the amount of energy, establishes when electricity can be provided, and terms or conditions. I still cannot envision a scenario where cabinet is setting rates.

I understand that they may provide direction to B.C. Hydro to set rates or, as it says right in the legislation, require the commission to set rates. But I don’t see how that would be done at the cabinet table without significant risk to the public, as has been pointed out.

I will wait for the Chair’s ruling on that one.

The Chair: We’ll take a short recess to make some copies of the amendment.

The committee recessed from 4:01 p.m. to 4:05 p.m.

[Jennifer Blatherwick in the chair.]

The Chair: All right, everyone. Members, we have an amendment to clause 2.

Leader of the Third Party, I understand that you have already been recognized to speak. Would you like to speak further to your amendment?

Jeremy Valeriote: No, thank you.

The Chair: Would any other members like to speak?

Hon. Adrian Dix: Yeah. I want to speak against the amendment. Like the other amendments that have been presented by members in this session, it’s not an opposition to their presentation of the amendment or some of the ideas involved, but specifically, this goes counter to what we’re trying to do here.

I want to just make this point that members have made. They made it earlier this year, when cabinet did set the rates for B.C. Hydro for the next two years at 3.75 — and 3.75 rate increase. So cabinet has these powers already in other places in the Utilities Commission Act.

When we talk about setting a rate, we’re also talking about the terms and conditions of that rate, which are an important part of the allocation framework that we would create, which include, for example, possibility of curtailment.

Data centres are known for operating 24-7. If you’re managing the system, there may be an option, and you’d be making offers to a data centre around those questions and options around that. Should that be required, then you’d want that flexibility and all the terms and conditions associated with that. So while the member is taking these three words out of it, it won’t achieve what he would like it to achieve.

I think what he’s trying to say is he wants the B.C. Utilities Commission to play this role in setting the terms and conditions and policy of the allocation framework. And that is, I’d say, contrary to what we’re trying to do.

I understand what he means and what he’s attempting to do, but the impact of it would be to undermine the direction of the legislation and take away the flexibility B.C. Hydro has to act in the public interest in applying the allocation framework.

So for those reasons, I’d ask members of the House not to support the amendment.

Ward Stamer: Thank you to the minister for that explanation. But can we be clear that at the end of the day, B.C. Hydro is still mandated to be setting the rates, with the Utilities Commission as a filter so that there’s more scrutiny in the process, and that’s where the Utilities Commission Act stands.

So is the minister telling me now that cabinet can now just turn around and arbitrarily decide what electricity rates in British Columbia can be regardless of how much debt that B.C. Hydro has or what the operating costs are or what additional costs that have just been approved, whether it’s a cost for a transmission line that’s never ever been done before in the province of British Columbia, something that’s totally new? Is that what the minister is saying — that cabinet has the authority that they can just turn around and arbitrarily charge whatever they want?

Hon. Adrian Dix: I’d just note that, really, in all the years prior to 2017, cabinet did precisely that, and that generally speaking, we’ve supported the B.C. Utilities Commission in its role, although we did set the rate increase in this past cycle.

That’s what the Utilities Commission Act says, and that’s what, under the previous government, became the norm over a period of years, principally because of their concern around run-of-the-river projects and their impact on rates.

We saw what happened to rates in that overall period, which was 54 percent. And, of course, cabinet tends to under-set those rates, or tended to in those periods, but they still went up well above the rate of inflation.

[4:10 p.m.]

In any event, we’re creating an allocation framework here, so this is different from all of that discussion, though I appreciate it. We’re creating rates and terms and conditions so that B.C. Hydro can develop a framework where we get the maximum possible benefit for the people of B.C., its economic development interests and B.C. Hydro — of which we’re all shareholders, of course, as individuals, as people in the province — from the allocation of power to the artificial intelligence data centre and hydrogen for export sectors.

That’s what we’re doing, and that’s why I’m opposed to this amendment — not because I don’t appreciate the spirit of what the Leader of the Third Party is trying to do. But I don’t believe that making this change to the legislation will have either the desired effect or, overall, serve what we’re trying to do here, which is to take the opportunities applied in the AI and data centre sectors and deal with them in a paced way so they protect ratepayers. That’s the intent of the legislation, and that’s what these provisions do.

The Chair: Before calling the vote on this amendment, I wish to confirm for the record that the amendment is in order.

The question is the amendment to clause 2.

Division has been called.

[4:15 p.m.]

Members, everyone appears to be present. Are we in agreement to waive the time? Yes.

Leave granted.

The Chair: Before putting the question, I remind all members that only members of Section A or their duly appointed substitutes are authorized to vote.

The question is the amendment to clause 2 moved by the Leader of the Third Party.

Amendment negatived on the following division:

YEAS — 4
L. Neufeld	Valeriote	Mok
	Williams
NAYS — 5
Routledge	Brar	Kang
Higginson		Dix

Larry Neufeld: I’m going to take a little bit of a different poke here than what my colleague did. I realize this perhaps was something that may have been better asked in clause 1. But I’m going to ask for a little bit of latitude to see if this one….

Has B.C. Hydro performed any type of independent risk assessment comparing direct public ownership, i.e., B.C. Hydro ownership, versus the limited partnership structure that would be represented by this bill?

Hon. Adrian Dix: Yeah. It’s back in clause 1, but that’s fine. We had extensive debate on this and really responded to this prior. The advantage of the joint ownership model is that it significantly advances the project. It makes partners out of the First Nations along the line and allows us to proceed more quickly, which has real advantages to B.C. Hydro.

[4:20 p.m.]

We decided to pursue this model in 2023 as a result of those advantages and have been pursuing it since then. We’ve obviously signed term sheets with a number of nations. We’ve done that. On the overall management of the system, it will continue to be B.C. Hydro that does that. As we’ve discussed a number of times in our debate over clause 1, it doesn’t affect that part of it.

This is an unusual structure, in that we’re passing legislation to enable it to happen in section 1, and it hasn’t been done before. We think that it reflects…. I would say the same thing about, for example, Enbridge’s partnership with, I think it’s 40, First Nations along its line, which has never been done before as well. They, like we, believe that for their linear structures, that would be in their interest, that it would change the dynamic. That was important to Enbridge, which, as the member knows, has significant ambitions to continue to build in British Columbia and in Canada.

Larry Neufeld: To avoid making my questions sound repetitive…. I appreciate that answer. I do recognize that that was discussed at length. This question is related to: was an independent risk assessment from outside of Hydro or outside of the government completed? Or was it all internal?

Hon. Adrian Dix: I think the answer to the question is no. That would be the first question. Then he had a subsequent question. But “no” kind of handles all of it, I think.

Larry Neufeld: I think I’ll accept that.

This one was answered to a certain degree, but I think it’s germane to at least re-enter it with where we’re going in the next set of questions.

Again, please correct me on this, but I do believe that this was answered, and I apologize if it was. Is there any intention of expanding this model? What I’m talking about is the model of the lack of the Utilities Commission oversight. Are there plans to expand that to additional transmission lines or additional future co-ownership agreements?

Hon. Adrian Dix: The member, I think, may be referring to the certificate-of-public-convenience part of the process, which would be, in that case, the BCUC’s role in the capital project. That’s not in the legislation, but that is what the government is doing on the North Coast transmission line, having established a number of years ago, based on the work of B.C. Hydro, the demand for the electricity in the region and going forward from there.

So it’s not inconceivable that you could do it again, although I think that that process continues to be in place. For example, Fortis recently got a certificate of public convenience with respect to part of its Tilbury project, and B.C. Hydro does that.

There’s, of course, a threshold for that. That’s what the member is referring to. In general, the BCUC’s authorities are not affected otherwise by the legislation. What we’re trying to do in the legislation is maintain their authority by saying B.C. Hydro is responsible for the operation of the system. Since that affects ratepayers, they continue to have that opportunity. In other words, we’re not creating the joint venture partnership to avoid BCUC scrutiny in the way it does that and the responsibilities. That’s why the legislation is structured the way it is in section 1.

Larry Neufeld: Thank you for that answer, Minister.

Of course, Bill 14…. It would lead back in through there. I should have…. I guess I answered my own question on that one.

With respect to power generation under section 2 of the bill, the backgrounder that the government released claimed a 7,000 megawatt industrial backlog. Would that mean that the minister is acknowledging that B.C. lacks the generation capacity to serve that demand?

Hon. Adrian Dix: Well, it’s why we’re doing multiple calls for power. And we just tabled with the B.C. Utilities Commission, for its review, a massive and significant integrated resources plan. I think it’s the members of the opposition responsible for energy policy, all three, in their respective parties….

[4:25 p.m.]

Certainly B.C. Hydro…. We would be happy to arrange a briefing on that integrated resources plan that lays out details over hundreds of pages to the B.C. Utilities Commission. The B.C. Utilities Commission looks at that in its current capacity, which is unchanged by this or by legislation. The IRP includes a specific scenario, as I discussed yesterday, for the north coast, one that considers industrial growth, ports, mining growth, LNG and others.

In the northwest, the scenario forecasts 2,300 megawatts of new demand. How are we responding to that? Well, more energy efficiency. We’re going to see that soon in the response to the call for expressions of interest on energy efficiency. A lot of our savings or requirements for demands of power that we’re going to see — I talked about LED lighting previously — are enhanced by conservation. B.C. Hydro is a world-renowned leader.

The calls for power, Revelstoke unit 6, which is obviously using the final unit of Revelstoke, upgrades to G.M. Shrum, batteries and new resources such as wind and solar…. The calls for power will add 10,000 gigawatt hours a year to B.C. Hydro’s system, or 16 percent overall. Site C is now online. Of course, that’s 1,100 megawatts of capacity. And the Revelstoke dam, unit 6, is currently under environmental review.

If you look at energy efficiency programs, it saved 2,000 gigawatt hours of electricity, enough for 200,000 homes. And upgrades to G.M. Shrum will add 100 megawatts by fiscal 2035. We’ve also done a request for expression of interest on new sources of firm power. We’ve seen more than 100 responses to that, and we’ll be making that more public soon, but it’s 19 gigawatts of electricity. It includes hydropower and geothermal and a significant number of proposals that I just detailed in answer to a question yesterday.

All of this is found in our 2025 IRP, which we filed with the B.C. Utilities Commission. And B.C. Hydro…. It’s obviously extraordinary work, and it’s important to do these things in a transparent way, and that’s why we continue to work closely with the B.C. Utilities Commission on these questions, because they have a specific role with respect to the IRP.

When you’re talking about, “Do we need more power?” — and we had this discussion yesterday with the member for Kelowna — the answer is yes. Over time, in recent decades, there has been relatively flat power demand, and especially a decline on the industrial side, and we’re going into a period where we have significant demand.

This is not bad news for B.C. It means there’s opportunity for generational wealth, but B.C. Hydro is there to meet that just as it has at other times, in particular the 1960s, leading into the building of the Revelstoke dam.

Larry Neufeld: Thank you to the minister. Certainly in no way am I trying to disparage Hydro by any means. What I would suggest, based on that answer, is: do we have an indication or a list of projects, both by sector and region, that may currently be stalled because we don’t have the energy or the power to provide to them?

Hon. Adrian Dix: Well, two things, and this will get us back to section 2 perhaps, but I would say that what we want to do is ensure that the projects of the greatest value to B.C….

Just compare, for example, the value of electrifying the mining industry. Its value in terms of reduced GHG emissions is extraordinary for those projects, but also the values in terms of construction jobs, of permanent jobs, are significant.

It is, like I say, a generational opportunity, not to mention the royalties that come to the province of British Columbia that pay for important things such as health care and education and the other programs of the province.

What we’re doing by building the North Coast transmission line…. Again, that’s clause 1, but the North Coast transmission line is meeting that demand because, well, there are lots of people saying: “Well, where’s the generation?” I just gave an answer, a long list of the investment in generation and the opportunity for generation.

You also require transmission and distribution, because a lot of that demand is urban and growing communities, which requires upgrades to local systems.

[4:30 p.m.]

In fact, if you look at the $36 billion plan, which I know his colleague from Shuswap and himself have looked at and talked to Hydro about, the majority of that plan is for upgrading and system improvements of a system that was hugely built in the ’60s and ’70s.

All of that work has to be done, so that’s what we’re doing here. We’re ensuring that the job-creating industries, the most job-creating industries, have access to power. That’s why we’re building the transmission lines, why we’re taking action on the allocation framework. That’s why we’re doing all this building out of power across the province.

That’s fundamental to what we do. The benefit to the province will be significant. That’s, really, the role of B.C. Hydro. The intent of all this — the transmission line, the power generation — is to avoid what the member is saying.

Larry Neufeld: Thank you to the minister.

It does beg the question, in my mind, at that point, then, if we know that there’s a backlog, why are we…? As part of this bill, we’re implementing restrictions on allocating power as opposed to focusing on generating more power, although I do understand from your answer that we’re doing both. But should we not be focusing more on generating than on allocating?

Hon. Adrian Dix: Yeah. Well, we have to do both, and that’s what we’re doing. We have to do more than both. We have to generate. We have to have transmission and increase transmission. That’s why I support the North Coast transmission line.

I’ll spare the member another speech on this question.

Interjection.

Hon. Adrian Dix: The member never gets bored of these speeches. I find that hard to believe. I find that hard to believe, but the member is known to have a dry wit, so I’ll just leave it there.

But that’s why we need transmission. That’s why we need investment, obviously, in distribution, because communities grow. I was giving the example in committee yesterday of the community of Brentwood in Burnaby, which has a massive growth. It used to be, really, a single-family-house community. And if you drive by there, it’s like a forest of towers in Brentwood. Obviously, you’ve got to invest in your distribution system as well as your transmission system. So we have to do it all.

That’s what the North Coast transmission line does in that part of the province, because we see in that part of the province….

And if you talk to the mining industry, they’ll of course say that their decision to go ahead with Galore Creek or Schaft Creek or whatever the project might be will be dependent on a whole bunch of questions — the price of the resource and other questions. As a minimum, they need access to electricity, so if we’re going to pursue that opportunity…. The North Coast transmission line will be the spine, going across the North and then up, of that opportunity. That’s what we have to do.

But you’re right. We have to do generation as well. We have to do transmission as well. We have to walk and, as they say, chew gum at the same time. We have to do it all, and this time is such a time of urgency that we need to take all of these actions and ensure that we deliver the electricity to the maximum benefit of British Columbians.

That is the huge advantage of B.C. Hydro’s system for British Columbia, an advantage we have over Alberta and Saskatchewan and all of the American jurisdictions.

The Chair: Member.

Larry Neufeld: Thank you, Chair. I haven’t been called that special word that I was called twice yesterday yet: minister. I might have to dress better tomorrow. It just occurred to me as I was standing.

That does lead me into the next thought process as far as the question that I had. I know that you and I have discussed in the past that it has not yet been established, the criteria or the structure around which the allocation process will be decided. But is there not at least a general overview or something that we can put on the record that would allow people that are interested enough to listen to us to understand how that structure is going to work?

Hon. Adrian Dix: Yes, in a general sense, and then we can get into the details. It’s enabled by this legislation. The allocation framework will be limited to the areas defined by the legislation. Should we want to advance it into other areas, we would have to come back to the House and do that if we were to do it for another industry. Given that we’re banning crypto mining, it’s AI, data centres and hydrogen for export.

[4:35 p.m.]

The cabinet, after a consultation period that will include Indigenous people and industry and others — a fairly short one, because we want to go early in the new year — will set the criteria for that framework. Obviously, price and value will be part of that but also a priority for Canadian and B.C., which the opposition has indicated earlier today that they support in a general sense.

In addition to that, issues of data sovereignty. In other words, there’s significant pressure on data sovereignty. We want to make sure that projects that contribute to the data sovereignty of British Columbia, the protection of British Columbians and their privacy, are given priority in those discussions. So that would be another one.

Obviously, jobs would be an important consideration.

Those are some of the criteria of value to B.C. Hydro and the province. Jobs. There’s potentially the environmental value of a project, including some data centres which allow the reuse of energy, which is an important potentially environmental but also commercial benefit. So that process would be set out.

Then B.C. Hydro would have a clear process, with all of the rules laid out, and that people would essentially take part in that — whatever you call it — auction process, based on those criteria. B.C. Hydro would be overseen, as such processes are, by an ethics adviser, just to make sure that the decisions were made based on the information provided, based on how they meet those criteria.

Then B.C. Hydro would allocate the resource. It would be, as noted, 150 per year. B.C. Hydro would choose either two or three years in an initial competition, which would be 300 to 450 — two years or three years — for AI and 100 or 150 for data centres.

That’s how the process would work. At the end of that process, which would be transparent, B.C. Hydro would announce the winners of the process, those who have been selected in the competition. There are also, in these competitions, including RFPs, detailed processes for people who do not succeed, where they debrief on those processes as well.

Then an announcement would be made. That’s where I come back in, to be part of that announcement.

From the time that we set the ground rules, those decisions, that choosing of the successful or unsuccessful proponent, will be done by B.C. Hydro.

Larry Neufeld: Thank you, Minister. I do realize that that question may have been somewhat redundant, based on the lengthy conversation that we’ve had around it, but that does lead an excellent segue into an amendment that I would like to propose at this time.

[CLAUSE 2, in proposed section 21.1 (3) (d), by deleting the text shown as struck out and adding the underlined text as shown:

(d)establishing a procedure or rules by which a public utility must select which persons are eligible to receive electricity service for a listed purpose, which must include opportunities for consultation with a member of the Legislative Assembly who is recommended by the Leader of the Official Opposition;]

The Chair: Would you like to speak to the amendment first?

Larry Neufeld: I would.

On the amendment.

Larry Neufeld: The amendment is proposed to section 21.1(3)(d).

We had spoken of that briefly in the House. I think it’s incumbent upon us to have an all-party decision when it comes to this very important process so that British Columbians and the business sector understand that representation is being provided from all sides.

The Chair: Thank you, and we’ll take a brief recess.

The committee recessed from 4:39 p.m. to 4:44 p.m.

[Jennifer Blatherwick in the chair.]

The Chair: The amendment is in order. Members, we have an amendment to clause 2.

Now, you’ve spoken on the amendment. Are there any other members who would like to speak to the amendment?

Hon. Adrian Dix: What I will endeavour to do…. I don’t think that it’s useful.

I mean, I appreciate the distinction here, when it says it “must include opportunities for consultation with a Member of the Legislative Assembly who is recommended by the Leader of the Opposition.” I don’t think it’s useful to impose these things in law.

What I would say to the member: I’m opposed to it. We would welcome the member, potentially, to the cabinet, but it would require other changes for him. I’ll leave that discussion for a non-public place.

[4:45 p.m.]

I’m kidding the member, but I think it is useful to consult. I do think that…. As the member knows, I strongly believe in the importance of MLAs and in what they bring to the table.

While I oppose the amendment, don’t think we should establish it in the law in this way, I’d formally commit to him that I will consult him in the development of these regulations, and he will have access to me to do that as we go through that, because I think that’s an important and valuable process.

While I oppose the amendment to the bill, I’d acknowledge that members of all parties have much to bring to this process. So I would absolutely formally commit here to consulting with him.

David Williams: Thank you to the minister. Speaking of this amendment, it’s something I can fully support. We live in a democratic society, and I think that you can never have too much consultation. I think that having input…. We’re in the Legislature now. Working together collaboratively is a good thing. I think that anything that makes the public feel like they have a say is actually a very good thing for democracy.

And the ratepayer, whether the rates go up, down, sideways, or whatever, when there’s input and people feel that they have a say and it’s transparent, it’s a lot easier sell. And so for that reason, I have to say I’m fully supportive of this amendment.

Hon. Adrian Dix: I say that my general approach to things has been to involve people, and we’ll continue to do that. I appreciate that’s not putting that consultation in the law, which requires probably other ways to define it as well. I don’t think that’s a useful thing, but obviously the members share responsibilities in this area, so I would include him in my offer to the opposition Energy critic as well.

The Chair: Seeing no further speakers, I call the amendment. The question is on the amendment to clause 2. Shall the amendment pass?

A Voice: Division.

[4:50 p.m. - 4:55 p.m.]

The Chair: Do we have consent to waive the time?

Leave granted.

The Chair: Before putting the question, I remind all members that only the members of Section A or their duly appointed substitutes are authorized to vote.

The question is the amendment to clause 2, moved by the member for Peace River South.

Amendment negatived on the following division:

YEAS — 4
L. Neufeld	Valeriote	Mok
	Williams
NAYS — 5
Brar	Kang	Higginson
Dix		Shah

David Williams: On clause 2, a question to the minister. Can the minister justify why the government, in section 21.1, needs to take the role of rationing power and selecting who receives it, when the B.C. Utilities Commission already has the authority to do so in an open and transparent process under section 28(3)?

In my mind, we already have a process there. What’s the reasoning behind going to the new process?

Hon. Adrian Dix: All the BCUC can do under that provision, for example, is deny service, and we have a much different allocation framework, which works much differently, as he knows. It’s advancing the economic interests of the province.

As we’ve discussed a number of times — I don’t want to repeat it at length — the cabinet is setting conditions, and B.C. is Hydro doing what it has been doing for generations now, allocating electricity based on requests from ratepayers or potential ratepayers.

[5:00 p.m.]

David Williams: Thank you to the minister.

Again, maybe to clarify, there is a process, so I don’t see why this section of the transmission line, or everything that’s covered under this current bill, has to have a different process than we already have in place.

The thing is, B.C. Utilities Commission seems to be doing a fine job, and if this section is pieced off separately and you’re going to be evaluated differently, again, the B.C. Utilities Commission would be quite capable of doing that and looking after what they feel the ratepayers should pay.

Hon. Adrian Dix: The member is not correct. When he says the B.C. Utilities Commission is doing a fine job, he means B.C. Hydro is doing a fine job. It’s B.C. Hydro when new customers seek access to electricity that has a process now, which is largely, as discussed in second reading and in the previous debate, a first-come, first-served process. What we’re saying in this process is that it will continue to be the case for multiple industrial sectors.

Then, of course, we’re dramatically expanding access to generation and to power and distribution through other parts of the bill. But in this case, this gives B.C. Hydro the authority to set up the allocation framework in these specific areas — artificial intelligence, data centre, hydrogen for export — to have what’s effectively a competition or auction based on criteria to allocate power in rapidly scalable areas of the economy.

We’ve seen the massive demand for electricity from data centres and artificial intelligence centres. We’re not opposed to that, but we’re saying that that should be scaled and paced over time. That makes, I think, a lot of sense to people. It protects ratepayers, and it ensures access to clean electricity in B.C. to other industries. That’s why we’re doing this.

The BCUC doesn’t allocate power, as the member has suggested. That’s not its role. It has a very significant role in the system. For example, now it’s reviewing B.C. Hydro’s IRP, which is made public and answers in detail many of the questions that have come from all sides.

But it’s an independent regulator tasked with ensuring utilities provide safe, reliable service at fair rates and that they earn a reasonable rate of return. So it’s not just B.C. Hydro.

I can go on about what the BCUC does, but deciding which sectors or regions get priority access to electricity obviously includes trade-offs of all kinds of other issues that the BCUC doesn’t do and isn’t in their mandate. This doesn’t change their mandate to any degree. What it does is offer B.C. Hydro new criteria for making allocation decisions in rapidly scalable industries such as AI and data centres.

David Williams: Thank you to the minister. I stand corrected. I did mean to say B.C. Hydro. I do realize that B.C. Hydro is the one who allocates the power. I was just so darn concerned about the ratepayers.

Anyway, in clause 2, why is the council limiting the production of hydrogen for use outside of Canada?

Hon. Adrian Dix: I think the question is: why is the government differentiating between domestic use of hydrogen and hydrogen for export?

[5:05 p.m.]

Hydrogen export projects do offer potential for construction, employment and economic activity. Exporting clean electrons as hydrogen or ammonia means other countries benefit from the public ratepayer investment in B.C.’s supportive infrastructure and renewable electricity grid. Also, of course, as the member will know, there aren’t a lot of those projects now.

In contrast, domestic hydrogen, which is not subject to this and will have continuing access, benefits us in terms of local emissions reductions. Local use also improves air quality and public health, especially in communities transitioning away from fossil fuels. In addition, when clean electricity is used here, B.C. gets credit for the emission reductions, which support our climate goals.

We had the discussion with the member’s colleague in estimates about the hydrogen industry and the opportunities. The domestic hydrogen industry will not be part of an allocation framework. Hydrogen for export, because of the size of the projects, has the potential for massive use of electricity, with less benefit for B.C.

We’re not saying no to it, although there are no real projects right now. I wouldn’t expect a similar process to the one we see for AI or for data centres in the immediate. It’s simply going to require its own allocation framework, whereas domestic hydrogen will just continue to run and be supported by B.C. Hydro in the way that it is now, because of its huge contribution to B.C. and its economy and its growing opportunity for British Columbians all over B.C.

David Williams: Thank you to the minister.

Hypothetically, we assume that there’s going to be so much amount of electricity going through the current transmission lines that’s being proposed. At the current levels, how much production of hydrogen for use outside of Canada would be limited now? I understand there are no facilities right now, but there are proposals for future facilities. How much are we going to be limited by this regulation?

Hon. Adrian Dix: Of course, those projects are not just facing this in British Columbia but everywhere in the world, essentially — the barriers that we see in that industry: the high construction costs and the length of permitting processes; export projects are often large and require large electrical loads to realize necessary economies of scale; the capacity to interconnect large industrial loads in regions close to export terminals; and environmental, rental and human health implications of transporting hydrogen as ammonia.

Those are all limitations that are in place now. It’s the reason why, while we’re putting this in the legislation to prepare for the day, which may well come, when we have to have an allocation framework around hydrogen for export, we’re likely not to have a competition now because there would be no competitors.

Domestic hydrogen, in contrast, has many projects across B.C. and very significant benefits both to our economic and climate change objectives and is unaffected by these changes.

David Williams: Thank you to the minister.

Moving on, in subsection 3(a), can the minister please explain why the government needs the power to prohibit the sale of electricity for specified or indefinite periods of time?

Hon. Adrian Dix: Well, this sets up the process. You lose the obligation to serve and you regain it for the process, where you essentially compete in the competitive process and get access to the electricity you need. That’s what the allocation framework does.

David Williams: Thank you to the minister.

Again to the minister, is the minister intending to prohibit the sale of electricity to existing customers that would not fit the listed purposes outlined in this legislation?

Hon. Adrian Dix: No. In fact, as the member will know, as I said earlier in the debate a number of times, we currently have about 140 megawatts of load by cryptocurrency mining operations in British Columbia. They got in prior to the ban, and they continue to be served by B.C. Hydro as they would be. The ban applied after it was put in place.

[5:10 p.m.]

David Williams: Does the minister agree that there’s additional power available within B.C. that’s supplied by independent power producers that B.C. Hydro could acquire to allow the continuation of AI data centres in this province?

The reason I say that: there’s an awful lot of cogeneration that hasn’t been renewed. There are an awful lot of run of the rivers that either have not had their contracts extended, or we’re not sure if they’re going to be extended. Those are all independent power producers.

Currently, we need more power, not less power. My understanding is that, again, if we need additional power to supply the AI because we’re limiting it, because you’re allocating the power, why not be using the independent power producers?

Hon. Adrian Dix: Two points. I’m sure the member knows this. If a project is entirely behind the fence, it’s producing its own power, which is difficult for it to do, I mean, in these industries, because they tend to require 24-7 firm power. Then they, of course, are allowed to do that in our current system.

What, more typically, is a challenge for companies — and we see this in other jurisdictions — is, say, they decide to do wind power. They still require some connection to the B.C. Hydro system to provide the firm power that they need to back up that power. And that’s why the B.C. Hydro system is such a big advantage for everybody.

B.C. Hydro operates…. The member talked about concern for ratepayers, and the interest of rate payers in B.C. is why we’re having the most ambitious plan to increase generation of electricity in B.C., clean electricity that’s good for the economy, good for the climate. And we’re going to continue to do that.

When you have individual projects and contracts, it’s B.C. Hydro’s job to act in the public interest. So if a particular contract was well above, in terms of price, B.C. Hydro’s requirements, then they’d have to consider that. But I don’t think we’re talking fundamentally about the electricity required for AI.

What’s required for AI is a lot of electricity. You see it in this allocation framework. For the next three years, 450 megawatts. I repeat, the largest load in B.C. is 120 to 130 megawatts. So having that power, that’s a lot of power, 450 plus 150 for data centres. If you were to do a three year, then that would be 600 megawatts. We believe that that can be managed by B.C. Hydro within the system, and that’s why we’re doing that, as well ensuring that it doesn’t displace opportunities for projects that are in the greater interest of B.C.

In short, we are doing that. We often renew contracts. Sometimes there are projects that are not renewed. That’s done by B.C. Hydro operating in the interest. You can’t, on the one hand, say, “We want low rates,” and on the other hand, say to B.C. Hydro: “Don’t do anything to ensure low rates.”

David Williams: I thank the minister for the answer, which leads me right into the next question.

If the justification for limiting cryptocurrency mining and AI centres is a lack of power, is the minister aware that the independent power producer in Powell River has applied for an export licence of 700 megawatts of clean hydropower? If so, why hasn’t B.C. Hydro attempted to acquire the 700 megawatts of the B.C.-generated clean energy which would allow the creation of more made-in-B.C. jobs, which also would benefit our economy and further grow the rapidly growing AI tech sector in this province?

We have a ready-made power plant already, and now they’re going to be selling their electricity elsewhere.

Hon. Adrian Dix: I’m glad to hear that the opposition supports B.C. Hydro’s efforts in this respect to that specific contract.

As you’ll know, that issue is before the Canadian energy regulator now, but B.C. Hydro had an opportunity during the B.C. Liberal period in office to purchase that dam and chose not to. So it’s owned by another company. The name of the company is different than the overall company, but the overall company, as people will know, is Brookfield, which is an important company in Canada.

B.C. Hydro has intervened before the Canada Energy Regulator on that very question. B.C. Hydro has said that it’s willing to do just that. I hope that the opposition is supportive of my efforts and that of the government to ensure that the interests of British Columbia are supported and protected.

[5:15 p.m.]

David Williams: I thank the minister, and I believe we should all have to work together. We certainly want more power, not less power in this province.

Why is the minister pushing out business from our province by picking what can access a grid through the cabinet, other than instructing B.C. Hydro to work with existing independent power producers in B.C., generating jobs and growing our economy within B.C.? Independent power producers in these small little communities…. They could actually power small industry in their local areas. Why aren’t we working with them more?

[Steve Morissette in the chair.]

Hon. Adrian Dix: Well, the short answer is we are. We did a request for…. We did a call for power. It was for independent power producers. The opposition opposed it, by the way. But I just say that in passing, as we try and work together. The opposition opposed it. The Leader of the Opposition characterized the projects that succeeded in a derogatory way. And that’s his choice. It’s a free country to make those choices.

We did a call for power for independent power producers, with power the equivalent of Site C. Then we gave the electricity purchase agreements, and then we did it again. So if the member is asking whether we’re seeking power from IPPs, the answer is yes. We’re not just seeking it. Those were the first calls for power in more than a decade that had taken place in B.C. So I’m hopeful that the opposition will now support the government’s position in this respect.

In any event, that’s what we’ve done. I don’t disagree that we need more power, and we have sought that from independent power producers, and we’ve had independently run call for power competitions that have done just that, and sometimes we’ve heard from opposition members that they don’t like the result. They don’t like the winner, and they’re against those processes or against the types of projects, or they don’t like renewable energy or whatever it is.

The reality is that we’ve done exactly what the member has suggested, and I’m hopeful that the opposition will be supportive of it.

David Williams: Thank you to the minister for the last question. Just one really quick question, a follow-up to that.

Is there a criteria for the independent power producers currently? I know that this bill that we’re debating right now has a 50 percent Indigenous ownership. Is there a criteria for independent power producers?

Hon. Adrian Dix: Well, we’re on section 2 of the bill, which is an allocation framework for people seeking access to electricity. So this isn’t anything to do with IPPs. I’ve just mentioned that we’ve done significant calls for power in B.C., really the first in 15 years, that give significant access.

We’ve signed an electricity purchase agreement. We have another call for power now. We did a call for expressions of interest for firm power that included a lot of proponents around the province. So we are acting in this area.

Of course, this legislation doesn’t deal with IPPs at all. It deals with the allocation framework for three specific sectors. So when the member asks where IPPs are in the legislation in that sense, they’re in the broader question, and these are reasonable questions for estimates debate, and I’m happy to do that, and I’ve been relatively responsive to them, but this section is about creating an allocation framework on the IPP question.

The record in the last 18 months, as the member well knows, is extraordinary in the history of B.C. Hydro.

David Williams: Just to clarify my situation here, it’s the fact that IPPs, I think, are imperative, the reason being you have a transmission line, and you don’t have enough power to fill it. So the more power you have has a bearing on allocation, and therefore, IPPs can play a role in fulfilling any shortfalls that we currently have, which goes into this transmission line that we’re debating.

Hon. Adrian Dix: Well, they do, and we have.

[5:20 p.m.]

We did a call for power in 2024 that was the first of its kind in 15 years. Then, happily, we did another call for power, which is an independent competition that we announced in May of 2025, and it is on now. We did a call for expressions of interest.

We’re building Revelstoke 6. We’re doing something that we waited some time to do that’s important in terms of firm power and capacity. We’re making improvements to Shrum. Of course, we’ve just completed Site C. This is really, in this century, an unprecedented increase in generation.

We’ve had lengthy discussions of this question. But of course, these questions of generation are not really, in how we treat IPPs — in this case, very well; we’ve had calls for power where there hadn’t been one for 15 years — germane to this section of the bill.

The Chair: I recognize the member for Kelowna-Mission.

Gavin Dew: Thank you, and a warm welcome to the chair.

I’m just reviewing a few sections of the bill, and I’m hoping that the minister wouldn’t mind elaborating on the intent or some scenarios that could be covered. I’m looking at 3(f), which says: “enabling a public utility to collect from its customers the costs it incurs or the revenue forecasted to be lost as a result of a regulation under this section.”

Could the minister just elaborate a little bit on the breadth of scenarios that are envisioned to be covered under that?

Hon. Adrian Dix: This is something that was in place for the crypto bill and crypto ban, as well, in 2024. And really, what it says is that if there are customers in the queue who may have paid to B.C. Hydro moneys, that the loss of those moneys is recoverable by B.C. Hydro. That’s its purpose.

So in the case of crypto, there have been crypto companies who may have secured their place in the queue through security, and this allows B.C. Hydro to recover any losses in this from the rate base, which is just a normal practice of B.C. Hydro. That’s the purpose of that section.

Gavin Dew: I appreciate the explanation. That’s very helpful. To confirm, as it relates to what this enables, what prevents this power from being used to collect from specific customers? I don’t see specificity in terms of that recovery being via the rate base across the entirety of customers. So I’m just trying to understand the full range of powers that are enabled by this section. For example, when I read it….

I understand, in full depth, the explanation that the minister has given. I take that as being completely what is likely anticipated. I’m just trying to understand. It is enabling a public utility to collect from which customers the costs it incurs or the revenue forecasted to be lost. Why? What is the full range, if there are other scenarios within which revenues are foregone?

This seems very broad. I wonder why this section is not more specifically geared toward the purpose that the minister has articulated. It may have broader purposes that are intended. It may simply just be drafted in such a way that it’s a little bit difficult to discern the meaning. But I’m just wondering if the minister could expand a little bit on any limitations that exist around the kinds of losses that could be recovered and the specificity of which customers they could be recovered from.

[5:25 p.m.]

Hon. Adrian Dix: The application is specific to these customers who are effectively being discriminated against, in the sense that they’re being treated differently from other customers. It’s an allocation framework. So it’s specific to crypto and AI and data centres and hydrogen for export.

Gavin Dew: I appreciate the clarity that the minister has provided in that regard. I’ll return to 3(b)(iv) — I’m glad I studied up on my Roman numerals — which articulates: “establishes terms or conditions under which electricity service may be supplied for a listed purpose.” Could the minister elaborate on the range of terms or conditions that are envisioned to be set in place?

Hon. Adrian Dix: These are all the terms or conditions of being involved in the allocation process. It could potentially include something like curtailment, because that’s always an issue with data centres, in the general sense. Also, with all of the terms or conditions, you have to participate in the allocation framework for access to the electricity, or the process, if you’re in these industries.

So those are the terms and conditions being referred to — all the ones that we’ve described, including, most importantly, participating in the allocation framework itself. This is a different circumstance than it would be for, say, a mine or a manufacturing business or whatever.

Gavin Dew: Thank you. I appreciate the explanation. Again, I’m just trying to understand. That is definitely the intent. I’m just wondering about the range of effects that could be produced through this. For example, could a condition be established limiting the type or source of energy that could be provided under these circumstances? How would that interact with the Clean Energy Act?

Help me understand again. For example, could this be used for the Lieutenant Governor in Council to determine that only a certain form or source of power could be the source of power that is available through this legislation?

Hon. Adrian Dix: No, this is about demand and not supply. B.C. Hydro has a number of sources of electricity — the largest being hydroelectric, of course, but others. It runs a transmission system that is, obviously, managed for the whole province. This is about demand for electricity and not about the supply of electricity.

Gavin Dew: I appreciate the fulsome answer. With the indulgence of the minister, who has been very indulgent in the breadth of questions that we’ve asked…. I have been reviewing the Look West economic plan, which, obviously, has only recently become available. I am hoping that the minister will indulge me in asking some questions, sourced from it, that may be relevant to the bill, more broadly.

Looking to page 7, I note a reference to doubling the size of the AI and quantum sectors. The minister has provided various different numbers, good solid numbers, over the course of this examination of the bill. I’m wondering: relative to that target established in the Look West document, what does the government believe will be the quantum of energy demand required to double the size of the AI and quantum sectors?

Hon. Adrian Dix: Well, of course, now I’m taking estimates questions from my good friend the Minister of Jobs. I’m always delighted to do that. I won’t get into it too much, just to say that the AI and quantum sectors are about more than data centres or AI centres, which are quite specific parts of those sectors and have significant electricity demand in any event.

What we’re talking about making available over three years for the AI and data centres, under this allocation framework, is a full 600 megawatts, which is extraordinary. It will allow for significant parts, for that part of the sector…. I think the member, who will be doing work in this area, will understand that those sectors go far beyond the electricity questions there and involve massive work, in terms of research, that B.C. researchers are leading the way in.

There are significant industrial opportunities, some of which are what we call, classically, an AI centre, which is like that, and there are many others. What we’re doing is allocating significant electricity to those sectors in a paced way, so that we can provide it and so that we do provide the maximum benefit to B.C., which we’ve done.

[5:30 p.m.]

Obviously, that’s not the whole debate about those sectors, which I’m sure the member will have in another place, at another time, with the minister responsible.

Gavin Dew: Thank you. I very much appreciate it. It’s certainly helpful information. I do not intend to range too far outside of the scope of the minister’s portfolio, much as he might have fun doing it. So would I, because we’re both big nerds.

Now, again, having gotten into the scope of the go west document, the reason for my questions is in part simply because there is, obviously, new messaging, new proof points, new assumptions and new ideas being articulated in that document. I am just trying to backfill a little bit my understanding of how that corresponds with the approach being taken under Bill 31.

I’m looking to the section on the North Coast transmission line, page 24 in the go west document, which talks specifically about the NCTL as the project that can also support western Arctic defence capabilities and a future potential intertie with Yukon.

Again, obviously there are very good reasons why the listed purposes articulated in the bill as it stands are there. I’m just wondering whether a similar level of conversation is being had around the western Arctic defence capabilities that are envisioned to be enabled by the NCTL.

Why don’t we see any reference to that use, which is, again, specified and clearly meant to be foregrounded in the context of a government that is eager to partner with the federal government, who are eager to spend money on defence-related items?

I’m just trying to understand the correspondence and correlation between the approach that has been articulated in the context of Bill 31 and this new messaging about the purpose of the law, as articulated in the go west document.

Hon. Adrian Dix: I think that we’re ranging back to section 1. But we’ve done that before. So I think that’s the best way to get through it — to make sure questions are answered. That’s not an issue.

But I would say this. The North Coast transmission line will go from Prince George to Terrace and up to Bob Quinn Lake. It’s extraordinary, breathtaking, as a nation-building project and as a province-building project, and that has been acknowledged by the federal government.

There are only 11 projects on their list, and it’s one of them. We’re obviously proud of that. B.C. should be. It tells us, through that evaluation, which is obviously led by federal ministers and the Prime Minister but also the major projects office, that it is a significant endorsement of the approach.

With respect to the link, the intertie, to the Yukon that has been put forward by the government of the Yukon as a significant initiative, the federal government has expressed strong interest in that. As the member knows, you don’t take the transmission line to Whitehorse before you go through Bob Quinn Lake. So that opportunity is available.

Obviously, what happens in a further intertie with the Yukon might well involve other partners and so on with B.C. Hydro. Our vision of it is that, but we have an MOU with the government of the Yukon, as the member will be familiar. There has been an election, a new government. That government has certainly expressed its own support for these initiatives and working with the federal government. It would involve the federal government in it.

When you talk about the North Coast transmission line, it’s a great opportunity for northwest B.C., a potential opportunity in the Yukon.

That said, there are some challenges with going to the Yukon, including the amount of load that’s there and delivering that level of power to the Yukon. There are. But there are also significant opportunities, mining opportunities, which is why the Yukon government is so interested in that. It’s why the opportunities for the federal government, in their broad effort to build out the defence capacity of our country…. This is a significant change in, really, the last year of federal government policy. I think the member would agree with that.

This potentially creates opportunities and access to electricity for the Yukon, as well as for northwest British Columbia, and supports those initiatives. That’s what it’s referring to. There’s a very strong effort by the government of the Yukon to get a form of intertie that includes the Yukon. That’s what the document is referring to there, and I think it’s an exciting opportunity.

[5:35 p.m.]

It’s why the North Coast transmission line is not just strongly supported in Prince George, Fraser Lake, Burns Lake, Vanderhoof, Terrace, Prince Rupert, Stewart and other communities, but also supported in Whitehorse.

Gavin Dew: Thank you. I appreciate the fulsome explanation.

Just for my understanding of the approach that the government is taking, obviously…. Again, I appreciate the willingness to return to earlier parts of the bill. We obviously did not have the ability to review this brand-new economic document that has been newly furnished. I am sure that the delay in providing it until after the NDP convention had nothing to do with the fact that it actively supports the expansion of the military industrial complex and that there might have been NDP members there who might have been uncomfortable with that. I am sure that that was in no way, shape or form any part of why this document was delayed.

Returning to the topic at hand, I note that we have outlined the phase 1 project, phase 2 project, phase 3 project constituting spreads of the line. Is it a reasonable statement to say that that Yukon intertie functionally is phase 4 of the project?

Hon. Adrian Dix: Well, phase 4 of the project, should that exist, if you want to call it that…. I think right now we have done a lot of work on phase 1 and phase 2 and a lot of work on phase 3. This is a national project, and obviously B.C. will play its part in that. But it’s not phase 4 necessarily, B.C. Hydro’s project connecting to the Yukon. The Yukon might have its own say about that, what it wants to do and how it wants to deliver in that. That’s why we have an MOU with the Yukon to discuss it and why the federal government is so interested.

It would be true that that would be a long way to go to Whitehorse. But also, we’re a country, and we’ve seen unprecedented attacks on our sovereignty and the need to protect it, including in the North. For B.C. to make its contribution to that, of course, is something we’d strongly consider. I don’t think that I would describe it as phase 4 yet, but I would say that phases 1, 2 and 3 are necessary for the Yukon intertie to ever happen.

Gavin Dew: Thank you very much. I appreciate it.

Again, conceptually, if we see that Yukon intertie as being phase 4, is an Alberta intertie phase 5?

Hon. Adrian Dix: Well, the Alberta intertie is a separate question. It’s not really a North Coast transmission line question. I think that’s fair to say.

But we are doing very significant work with the government of Alberta on these issues of the relationships of the intertie and potential further interties between Alberta and British Columbia. We believe strongly that it’s even more in Alberta’s interest than in British Columbia’s interest. But it’s in both of our interests because Alberta has a variety of electricity challenges in its own right that can benefit them as they benefit us, potentially. So we are actively pursuing that.

Nathan Neudorf, who’s the Alberta minister responsible, does an excellent job for that government in pursuing those issues, and we are working with the government of Alberta. One of the first things I did when I became Minister of Energy was go to Alberta to meet with Alberta officials about just these questions because I think in spite of the differences between our jurisdictions on some questions that have been noted in the media and other places, we have a lot in common and a lot of common interests, and issues around the intertie are active considerations between ourselves and Alberta.

I say delicately that that particular subject isn’t connected to either section 1 or section 2 of the bill.

Gavin Dew: I would submit that electrons that would flow via a northern intertie are directly connected to the bill.

Back in 2018, Natural Resources Canada funded a G.E. study that modelled a new northern intertie between the Peace and Alberta. Again, I’d just like to understand the connectivity between power that could conceivably be sourced from Alberta and make its way onto the North Coast transmission line in order to service the region.

One of the issues that we have expressed some concern around — it hasn’t really been my primary subject here, but it has been raised — is the question around actual power generation capacity versus transmission capacity.

[5:40 p.m.]

So again, just trying to understand that interplay of energy produced in Alberta, potentially through a northern intertie that has been modelled, being a source of power, recognizing, obviously, the fungibility of power and all those things.

Help me understand the connectivity between that northern intertie and power sourced in Alberta ultimately being provided to those projects that require them along the North Coast transmission line.

Hon. Adrian Dix: Of course, section 1 on the North Coast transmission line has to do with First Nations partnerships. It enables those First Nations partnerships. Obviously, the existing section has to do with the allocation framework, which is different. That is the point I’d make to the member.

The issues around interties with Alberta include the existing intertie. There are a number of issues between B.C. Hydro and the Alberta system on those, and those are important issues that we’re trying to resolve in our joint interests. Alberta has interests and concerns with other neighbours, as well, in those discussions, and we believe that the two provinces can be very supportive of one another.

The creation of a northern intertie is another proposal sometimes suggested from Alberta. The member will know, for example — and this is, I think, a ways in the future — that there is a proposal that’s headed up by Ian Anderson, I think, around nuclear power in northern Alberta. And there are other issues that they have that they’re interested in that would involve transmission and other opportunities around a northern intertie as well.

But we have significant issues around the existing interties that would be in the interests of British Columbia, because we are, in many ways, more competitive than Alberta in these areas, and that has benefits for them and for us, potentially.

Powerex is a very sophisticated player in this area, not just in the United States but in Alberta, so we’re continuing to pursue those, and I’m pursuing those with Minister Neudorf. That work really continues, and hopefully, we’ll arrive at some good solutions for both provinces.

We’ve also supported some requests for Alberta for funding from the federal government, not to British Columbia but to Alberta in support of some of their existing issues around the intertie to increase capacity. All of this is work that we’re doing now, which is, I think, valuable and important work and reflects what we have to do as a country even when, as everyone notes, sometimes there are issues that we disagree on.

Gavin Dew: I didn’t expect the minister to go there, but it sounds as though…. Just to confirm, has the minister or his team engaged in conversations about purchasing nuclear power from Alberta?

Hon. Adrian Dix: No. I’m just saying that there are proposals like that and people talking about that, around that. But there are also other proposals, as the member suggests, around adding an intertie between British Columbia and Alberta and the benefits that that might bring to both jurisdictions — and all of those issues.

The nuclear thing is just a proposal in Alberta anyway, and whether that’s reasonable or not for them, they’ll have to determine. I would think, primarily, the goal of that would be to serve the city of Edmonton, given its location. I don’t think that’s the primary issue for B.C. But we’re having open discussions with Alberta in the joint interests of the two provinces. I think that’s exactly what we should be doing.

It was a priority for me in my early days as minister. It has now been a year. One of the first things I did was engage in those issues because I believe that there are joint interests between Alberta and B.C. in this area and in natural gas and other areas where we can act together in our joint interests and the interests, in particular, of ratepayers in our two provinces and of course of the finances of the two provinces as well.

Gavin Dew: Putting aside the politics for a moment and focusing strictly on law and regulation, is there anything in B.C. statutes, regulations or B.C. Hydro’s mandate that legally forbids B.C. Hydro from purchasing electricity generated at a federally licensed nuclear plant in Alberta?

Hon. Adrian Dix: Well, I think that what there is in the Clean Energy Act, as the member will know, is prohibition on the production of nuclear energy in B.C. These projects take so long to build that we’ll be able to cross all those bridges as we come to them if Alberta does indeed seek to do that. That would be an Alberta choice, an Alberta project.

It’s, of course, in that case, not a small nuclear reactor they’re talking about, just to be clear, and it’s just a speculative proposal. There are other speculative proposals in Canada as well.

[5:45 p.m.]

I would say that we had a long discussion of small nuclear reactors in the committee previously. I don’t think I’ll repeat that discussion. The short answer is that that is a proposal that exists in Alberta, but right now it’s not really something that we’re considering in our plans because it’s a theoretical proposal in another province. So we don’t need to worry about that.

What we are doing is dealing with significant issues on the intertie between B.C. and Alberta, and we’re doing that work. We have been for months. I’m very proud of the work we’re doing. I think Minister Neudorf, the Alberta minister, is particularly engaged in that work. We’re optimistic we’ll have a good result for B.C. and Alberta.

The Chair: Okay, Member. We’re just straying a little bit from the bill. If we can keep it tighter on the bill, please.

Gavin Dew: You bet. I think we’re actually very focused on the bill.

I’m just trying to understand. With the development of this transmission line, what I am trying to understand is the full range of options available and being considered in order to provide power through this line. A line without power isn’t much of a line, so I am just trying to get some clarity around the range of options being considered and any options that have been expressly prohibited. So I do think I’m pretty on topic here.

I would just ask the minister again. I didn’t really get a clear answer in the last question. I’d like to understand whether there is, in fact, a legal prohibition on importing electricity from a nuclear plant in another province. Is there one, yes or no?

Hon. Adrian Dix: I’ve entertained this for quite a while now. It’s completely beyond the scope of the bill. We’re on section 2 of the bill right now. I’ve answered a lot of questions from the member.

This is a theoretical project in Alberta that isn’t currently in existence. But I made the point, because I was engaging fully in the debate, to say that these are issues that exist in Alberta and that, clearly, future governments may have to consider.

With respect to the production of electricity, we just tabled with the B.C. Utilities Commission our IRP, which shows a massive addition of generation to the B.C. Hydro system, multiple calls for power. I’ve given this presentation before, and the member has heard it, so I won’t repeat it. But he knows the details of that, and obviously none of that is included in that IRP.

We are working with Alberta and will continue to, but that does not have very much at all to do with the North Coast transmission line and the section 1, which includes First Nations participation in that line, and obviously not with the allocation framework.

I’m happy to have some debate, but I think the member has strayed to the far parts of that debate, and we don’t need to debate its relevance. Of course, we’ll have an opportunity to discuss energy policy in estimates in the future. As we develop and, certainly, if we reach agreement on issues of intertie, I’d be happy to brief opposition members about those discussions. Right now they’re that. They’re discussions, although they’re well advanced.

Gavin Dew: While I appreciate the minister appears uncomfortable with talking about nuclear energy — he has pooh-poohed small nuclear reactors — I’m not really getting a clear answer around the subject. I believe this subject is actually quite core to, again, the form of energy that will be moving through this transmission line.

Again, just so the record is clear, the no-nuclear objective in the Clean Energy Act applies to how B.C. meets its energy objectives within the province. It does not explicitly ban the import of electricity generated in a different province under federal nuclear regulation. Is that the minister’s understanding as he thinks about the future of this transmission line?

Hon. Adrian Dix: Of course, clause 2 has nothing to do with the North Coast transmission line that we’re on. We’ve allowed some rein to the North Coast transmission line, but this also has nothing to do with that.

That said, there is a prohibition in the Clean Energy Act. I have, on the record, expressed my view about his position, the opposition party’s position, repeatedly stated, to support small nuclear reactors on the north coast, how that is a ridiculous position, how it would cost tens of billions of dollars, how it would cost ratepayers, how there’s no plan and never any plan on the north coast to deal with nuclear waste and why it’s a bad proposal.

Repeated members of the opposition — his party, perhaps not including himself in his discussion at second reading, but nine of them — suggested you could do a small nuclear reactor at the fraction of the price of the North Coast transmission line, which is ridiculous. We’ve made that point in the debate. We made that point in the second reading debate at length.

[5:50 p.m.]

On all of that, the Clean Energy Act is pretty clear. We don’t plan to change the Clean Energy Act with respect to nuclear energy in B.C. That said, there are projects — for example, one in Darlington and one in New Brunswick — that are being pursued right now. They’re immediately beside existing nuclear reactors, which is obviously an advantage for some of the reasons I’ve stated. They’re of very large cost, energy significantly more expensive than, for example, Site C or the energy projects we’re pursuing in B.C.

I think it’s reasonable for us to continue to have a watching brief on small nuclear reactors, because we want to learn what other jurisdictions are doing. There are no existing small nuclear reactors in North America, and it’s the key, the centrepiece of the member’s energy policy. I disagree with that, and I’ve expressed that.

With respect to theoretical projects in Alberta, those are issues that we’ll address in the future, if in fact they come into play. But in British Columbia, the Clean Energy Act still applies.

The Chair: Member, I’ve allowed a lot of leeway on both sides here. Let’s come back to clause 2, please.

Gavin Dew: Thank you. I’ll just wrap up on this particular area because, again, I haven’t really heard a clear answer from the minister.

I am just looking to understand the interpretation of the Clean Energy Act because we have raised various different scenarios around how this power could be generated or provided and what those costs could be. I think that it is absolutely core to a discussion around the North Coast transmission line to understand what range of options are being considered. I think that’s absolutely core.

I think that the minister has freely engaged with questions around different nuclear scenarios, so I do just want to get a really clear answer.

If B.C. Hydro were to import electricity from a non-emitting nuclear facility in Alberta, would those imports count toward the 93 percent clean or renewable requirement in the act, or would they be treated separately from B.C.’s domestic resource mix? If they don’t count as clean under the act’s definition, does the act prevent B.C. from importing them at all, or does it simply mean we cannot rely on them to meet the 93 percent target?

Hon. Adrian Dix: Again, the member is asking a question from the Clean Energy Act, which he’s entitled to do. I noticed he didn’t defend his absurd position that you could do a small nuclear reactor on the north coast at a fraction of the price of the North Coast transmission line and other energy production. He can’t because it’s so absurd.

It was presented by multiple members of the opposition. They presented, believe it or not, a position that said something that would be massively more expensive, that would require decades to get regulated is the core piece of their energy policy. That’s what they presented.

They are opposed to bringing electricity to the north coast of B.C. through our existing system. They’ve opposed the North Coast transmission line. Their alternative is small nuclear reactors, with the fantasy that that’s a fraction of the price. It’s not.

With respect to nuclear projects in Alberta, clearly those are things that are theoretical for Albertans. They haven’t decided to proceed in that. Having a debate about that right now doesn’t seem reasonable to me at all.

The Clean Energy Act is clear on the issue of nuclear energy within British Columbia. I’ve stated that a number of times, and the member will acknowledge that. It was put in place not by me but by another government, Mr. Campbell’s government. And it’s one that I support.

I think on nuclear energy, we should continue to be aware of what’s going on in the world. Right now there are no small nuclear reactors anywhere in North America. Really, it’s just China and Russia that have them and only, in those cases, a very small number of small nuclear reactors. So making that the centre point of your energy policy is something that justifiably should be embarrassing to the opposition, but nonetheless that’s their position.

We’re going to continue, I think, to pursue clean electricity in our province through the very significant measures we’re taking. I won’t repeat them all again, but I think they show that B.C. Hydro and the province are doing an excellent job of responding to the urgent challenge of this time, which is to deliver, transmit and distribute more electricity to allow B.C. to grow its economy in the coming decade.

The Chair: Member, please refocus on clause 2.

Gavin Dew: You bet. I look forward to wrapping up this line of inquiry and to returning to clause 2.

[5:55 p.m.]

I’m just a little bit confused here because I’m not asking about small modular reactors. I’m asking about nuclear power from Alberta, and the minister is avoiding the question, which suggests to me it makes him uncomfortable. He is also avoiding answering, clearly, questions around the Clean Energy Act.

The Chair: Member, you are not focusing on clause 2. Please focus on clause 2.

Gavin Dew: I will focus on clause 2 very soon, as soon as I get a clear answer from the minister to a clear question.

The minister has, on three asks of this question, conspicuously avoided answering the question as to whether or not the import of nuclear energy from another province is captured under the Clean Energy Act. I will ask one last version of this question in an attempt to elicit an answer. If I can’t get an answer, I will assume it’s because the minister doesn’t want to answer the question for a darn good political reason — that he doesn’t want to concede that he is considering importing nuclear energy from Alberta.

If Alberta were to have an oversupply of firm, non-emitting nuclear power at a competitive price, is there anything other than government policy preference that would stop B.C. Hydro from entering into a long-term power purchase agreement to import some of that nuclear energy?

The Chair: Pardon me. That is the same question we’ve heard over and over again.

Minister, you may or may not answer, or we can carry on with clause 2.

Hon. Adrian Dix: The member is asking a question about a fantasy project. It doesn’t exist. People are talking about a fantasy project. It’s more than a decade away and isn’t in British Columbia.

We’re clear what the law is in British Columbia on the Clean Energy Act. We’re clear of our position on his position, which is that, apparently, small nuclear reactors can go ahead at a fraction of the cost of existing energy sources and, therefore, we shouldn’t build the North Coast transmission line, a position that is laughable in the face of the evidence. That’s his position.

We’re having this debate. We had an extensive debate on the North Coast transmission line. I support it. He opposes it because he thinks that power from the North should go to Vancouver and we should build transmission lines to Vancouver but not to Terrace. That’s his position. It’s not my position.

I would say that projects that are theoretical projects in Alberta are not something that I would ordinarily consider. But I said in the debate, happy to say it, that they’re looking at that in Alberta, and that’s something that in ten or 15 years from now, when they do that, B.C. might have to consider, some future government would have to consider.

I am not embarrassed about talking about non-existent projects in other jurisdictions. We’re working on real arrangements around intertie. I know the member’s job is to chew up half an hour, so mission accomplished over there, but it really has nothing to do with the bill.

Gavin Dew: I will wrap this up and allow my colleague to take over, simply saying that, again, while the minister might not like for this to be relevant to the bill, this bill has been packaged by this government as being all about the North Coast transmission line. They have made this a significant political artifact. They have called it a matter of confidence. Yet repeatedly for half an hour, the Minister of Energy refuses to answer a very basic question about how his government thinks about nuclear energy.

He has sat here and he stood here and castigated the opposition for having a conversation about small nuclear reactors, yet he will not actually answer a blindingly obvious, clear question about whether the future of the North Coast transmission line includes an additional northern intertie that has been studied and whether, in fact, there is a probability, a legal possibility, for nuclear energy from Alberta to be the very energy that ends up going through the North Coast transmission line. I think that’s a very simple question to answer, and it alarms me that the minister is unable to do so.

I am somewhat bemused by the hypothetical, imaginary project, because earlier this year when I raised the matter of dredging Burrard Inlet, when I raised the matter of an expansion of the Trans Mountain pipeline, the minister at that time referred to it as a hypothetical, imaginary project.

When, in fact, I dialled in the specificity, the federal government began talking about it, and it became clear that, in actual fact, there will be a significant expansion of the Trans Mountain pipeline. There will be a proposal to dredge Burrard Inlet. It turned out that this minister and this Premier actually actively support those two projects, which is a significant change in direction from a government that previously fought against and delayed and drove up by billions the cost of doing those projects.

[6:00 p.m.]

So I think it’s a very fair and reasonable question. I’m providing a very fair and reasonable opportunity for the minister, who is advancing the North Coast transmission line, which is a central political priority for his government, to provide British Columbians with clarity as to how they will approach the question of importing nuclear energy from Alberta. If he can’t answer it, that says a lot.

The Chair: Member, you’ve asked the same question over and over again. I’ll ask if there are any other members that have a question.

Hon. Adrian Dix: Well, I….

The Chair: Would you like to answer?

Hon. Adrian Dix: I’m happy to respond to the member. He talks about talking about small nuclear reactors. That’s their policy in their platform, in their announcements, in their presentations. He mentioned, I believe, himself, in his speech, that they said it was a fraction of the price. It is ridiculous. They should be embarrassed. They should withdraw it. They should walk it back, because it would be disastrous for people in the northwest, which they purport to represent, disastrous for the province, disastrous for B.C. Hydro ratepayers, and of course, putting a nuclear reactor on a fault line may not be the best idea.

The member creates fictional questions and then demands that I answer them, hypothetical questions about projects that don’t exist at present, and then he returns to an issue of interest, which we’ve had exchanges about, and I’ve given fulsome responses in the House repeatedly.

So that’s the game. They want to chew up some time. They’re filibustering the bill. What we try and do in bills of this sort is give a wide berth to the opposition to ask questions, so I’ve been responding on issues of the intertie with actual things we’re doing now.

When he says we’ve been talking for half an hour and I haven’t been giving answers, that’s of course completely untrue. We’ve been providing answers to all the questions, even though they are not even slightly connected with the subject of the legislation or the section in question. But I like to humour the hon. member because I think it’s an important service I provide to the people of B.C.

Jeremy Valeriote: I’d like to table an amendment to clause 2. If I may speak to it.

[CLAUSE 2, in proposed section 21.1 (3) (d), by deleting the text shown as struck out:

(d)establishing requiring the commission to establish and annually review a procedures or rules by which a public utility must select which persons are eligible to receive electricity service for a listed purpose; .]

The Chair: Okay. If you could speak to the amendment?

On the amendment.

Jeremy Valeriote: Clause 2, 21.1(3)(d). I’ve spoken a couple of times about some of the dangers I see with putting some of this decision-making directly in the hands of cabinet, which lacks a certain amount of transparency and requires the public to go to the order in council website and pick apart wording without any rationale or explanation.

So 21.1(3)(d) currently reads that the cabinet will establish procedures or rules by which a public utility must select which persons are eligible to receive electricity service for a listed purpose. I suggest an amendment and am proposing an amendment that requires the commission to establish and annually review these procedural rules by which B.C. Hydro, the public utility, will select who is eligible.

I will await the Chair’s ruling on the amendment.

The Chair: Thank you. We’ll take a five-minute recess to print amendments for everyone in the House.

The committee recessed from 6:03 p.m. to 6:08 p.m.

[Steve Morissette in the chair.]

The Chair: Okay, we’ll call the House back to order.

I find the amendment in order, so I’ll ask if there is any discussion on the amendment.

Jeremy Valeriote: I’ll restate fairly briefly. The entirety of clause 2 hands…. I mean, the stated purpose is to expand the powers of Lieutenant Governor in Council to establish some of these parameters by which we’ll allocate electricity to these specific sectors or groups of industries. I’m accepting of that up to a point.

But as we get further down the clauses into 3(d), establishing a procedure or rules by which a public utility will select who is eligible to receive electricity service looks to me to be the cabinet reaching too far into some operational details.

[6:10 p.m.]

This is something that they can request, or the minister can require the Utilities Commission to do. The minister has the discretion to require the commission to do a fair number of things. However, at least at that point, the commission is doing so in an open and transparent purpose, the public can be heard on it, and it can be guaranteed to be annually reviewed.

We’re now talking about some of the criteria that we will use to pick these winning and losing groups of industries. So I would encourage my colleagues to support this amendment. I don’t believe it’s removing…. I believe this preserves the cabinet’s right to make some of these decisions, but I think it curtails that to a certain degree into the commission that is built for this purpose.

Hon. Adrian Dix: Well, the commission isn’t built for picking winners and losers in allocation processes. That’s not its role. It has never been its role. We wouldn’t expect it would be its role in the future. They’re not set up for picking winners and losers.

B.C. Hydro is, based on criteria and terms and conditions provided by the Lieutenant Governor in Council. And this enhances B.C. Hydro’s ability to make decisions in an allocation framework for these specific industries. So the amendment doesn’t make sense in that sense. It’s not the right direction with BCUC.

We’ve had fairly lengthy discussions about a variety of questions like this, but the electricity allocation is a policy decision. The BCUC’s role is to review utilities plans, not to create them. This would be a fundamental change in its role.

We’re creating an electricity allocation framework based on rules in the public interest that B.C. Hydro will apply in a transparent way. It doesn’t negatively affect BCUC’s responsibilities in any respect, but it does allow us to proceed with a process that the cabinet and B.C. Hydro are well suited to implement.

The Chair: Seeing no other speakers, I call the question on the amendment to clause 2.

Division has been called.

[6:15 p.m.]

Members, is there consensus to waive the time?

Leave granted.

[6:20 p.m.]

The Chair: Before putting the question, I remind all members that only the members of Section A or their duly appointed substitutes are authorized to vote.

The question is the amendment to clause 2 moved by the Leader of the Third Party.

Amendment negatived on the following division:

YEAS — 4
L. Neufeld	Valeriote	Mok
	Williams
NAYS — 5
Routledge	Brar	Begg
Higginson		Dix

Hon. Adrian Dix: I move that the committee rise, report progress and ask leave to sit again.

Motion approved.

The Chair: This committee stands adjourned.

The committee rose at 6:21 p.m.