Utilities Commission Act

MINISTRY OF ENERGY, MINES AND PETROLEUM RESOURCES The 2002, BC Energy Plan required new power generation to be provided by private sector Independent Power Producers IPP. BC Hydro is limited to undertaking efficiency improvements at existing facilities, and constructing large hydroelectric facilities with the prior approval of Cabinet. IPP proponents spend significant amounts of money to collect data, undertake studies, and satisfy the requirements of BC Hydros energy call process and to obtain many federalprovincial regulatory approvals. New legislation passed in Spring 2006 Bill 30 declared that IPP projects on provincial Crown land, which have an electricity purchase agreement from BC Hydro, Powerex or FortisBC and all prescribed approvals, cannot be prohibited from proceeding by local government land use regulation. Local governments may still wish to require setbacks and temporary use permits however. Prior to the UCA legislation, projects were also subject to local government zoning requirements that can and have prohibited federally and provincially approved projects. If an IPP was to proceed in violation of a zoning bylaw, a legal challenge would have occurred with the outcome of litigation uncertain. Based on legislative precedents the Right-to-Farm legislation and exemption of mines from the Local Government Act the ministry drafted UCA amendments to clarify that local government cannot prohibit IPPs from constructing a power production facility on Crown land, under certain conditions. Some local governments see the legislative changes as: -inconsistent with the Premiers New Era Commitment that Crown corporations will subject to local government zoning processes; -an attempt by the Province to reduce their authority to regulate land use within their boundaries; and, -contrary to the intent of a 2004 Memorandum of Understanding MOU signed by the Union of BC Municipalities and Ministers to facilitate IPP development. A MOU working group comprised of staff from ministries of Community Services MCS, Energy, Mines and Petroleum Resources MEMPR, Agriculture and Lands, Intergrated Land Management Branch MALILMB, Economic Development ECDV and Environment MoE, Union of British Columbia Municipalities UBCM staff, an elected SLRDUBCM official and ex-officio representation from BC Hydro and BC Transmission Corporation began meeting in March 2005 to advance the work set out by the MOU. The discussions focused on information-sharing and process, but with limited progress. The Deputy Ministers of MEMPR and MCS met with the Executive Director of the UBCM on March 1, 2006 to discuss the closure of the MOU. In September, 2006, MEMPR and MCS staff met with UBCM staff to discuss ways of enhancing local government involvement in IPP regulatory processes. Information was provided to UBCM for distribution listing the projects with EPAs and the local governments within which they were located. A mini-guide entitled Opportunities for Local Government and Public Participation in Provincial Regulatory Processes for Independent Power Producers Projects was prepared collaboratively by MEMPR, MoE, MALILMB, the Environmental Assessment Office and UBCM. This was distributed to UBCM and is posted on the MEMPR website. The amendment does not eliminate local government involvement and engagement in IPP review and approval processes. The Province of British Columbia wishes to continue to have local consultation with communities similar to the process now used with natural resource projects. Local governments are knowledgeable about community issues and are, therefore, well positioned to help resolve these issues with provincial decision makers. IPPs are encouraged to interact with local governments, communities and First Nations as early as possible in the development and permitting of a project. Minister Neufeld has written to Larry Bell, Chair, BC Hydro noting that in its 2006 Call for Tenders, BC Hydro required bidders to provide a description and summary of all community consultations conducted and planned relative to a specific project where that consultation was a requirement of regulatory processes, including those of local governments. Retaining this element in upcoming call instructions informs the IPP industry that all proponents are still expected to develop and implement a plan to meet with local governmentscommunities and to provide information about their projects and opportunities for local input and feedback. IPPs are also encouraged to look for opportunities to distribute the benefits from their project to local communities. This may be through purchases of equipment or materials, job creation, or contributions to community-identified needs. IPP projects are also subject to property taxes, a portion of which is retained by local governments.