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National Energy Board

Reasons for Decision

British Columbia Hydro

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EH-1-89

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June 1989

Electricity Exports

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National Energy Board

Reasons for Decision

In the Matter of an Application Under
the National Energy Board Act

of

British Columbia Hydro and Power Authority

EH-1-89

June 1989

© Minister of Supply and Services Canada 1989

Cat. No. NE 22-1/1989-5E
ISBN 0-662-17105-5

This report is published separately
in both official languages.

Copies are available on request from:

Regulatory Support Office
National Energy Board
473 Albert Street

Ottawa, Canada

K1A 0E5

(613) 998-7204

Printed in Canada

Ce rapport est publié séparément
dans les deux langues officielles.

Exemplaires disponibles auprés du:

Bureau du soutien de la réglementation
Office national de l’énergie

473, rue Albert

Ottawa (Canada)

K1A 0E5

(613) 998-7204

Imprimé au Canada

(i)

Recital and Appearances

IN THE MATTER OF the National Energy Board Act and the Regulations made thereunder;

and

IN THE MATTER OF an application by the British Columbia Hydro and Power Authority to
vary the term of Licence EL-162 pursuant to subsection 21(1) of the National Energy Board
Act. Filed with the Board under File Number 1923-B7-7.

HEARD at Vancouver, B.C. on 6 and 7 March 1989.

BEFORE:
J.-G. Fredette
A.B. Gilmour
. D.B. Smith
APPEARANCES:
K.C. MacKenzie
P.D. Feldberg

E.C. Eddy
J.W. Fraser

A. Hulbert

D. Caldwell
B. Mueller

K.C. McAllister
J.E. Miltimore

G. Podersky-Cannon
G. Wilson

G.R. Bing

J.M. Black

I.G. Waddell, M.P.
P. Graham

D.G. Bacon

A.R. Androsoff

« D.Tremblay-Lamer

Presiding Member
Member

Member

British Columbia Hydro and Power Authority
Alcan Aluminum Limited

BC Gas Inc.

City of Port Moody

ISCA Management Ltd.

Judicial Action
Kootenay Okanagan Electric Consumers Association

Liberal Party of British Columbia

On his own behalf

On his own behalf

Port Moody/Coquitlam

Society Promoting Environmental Conservation
TransAlta Utilities Corporation

Westcoast Energy Inc.

National Energy Board

(ii)
Table of Contents

Recital and Appearances ...........cccecscscccscscecscscceccncesscnssseneneseasscnsssessesnseesssaenenenserecenes i
Abbreviations © cic. cicocsce ccc nececos (seat ened ae eee tee eae cs SRS ose eithe ca Dale ys wislge tietsiseles eve 06 ce eermremeeeM ili
1s .Background).%. iis wos loeht- etal ee Be ed EIS BER ER EL TS Es ated de i
2. The Applicant ...0..00edsccncedeestu ses te ice ReenOne aturde cides Vr aera tortie ripe domecser oven tne= ve eaaetencs 2,
3. The Application .......::.00c0:<¢ofevanyoveesscst eens eee eee eens cote ag 2 oe Ble sere ce un ese eee Me 3
A. Intervenor’s Motion icc eeic este arnt ee ee eo a eee datniete des vite sods nae Cee sem eure areata 4
4.1 Motion to Request Federal Department of the:
Environment Participation inithe Wearing 9) .--...1....ceses ce sere eee acas ceccen eee oneare 4
4.2: Disposition of Motions 22.5 .crcsec Se eet ccee tec ee cocoa y onde red ceavnetencenaen aie <n tacea eee 4
5 The Evidence wien cet natant ces sons 0a OR n ee ere re Oe Eee Rte eee reas Fae Cerne et ee ee 5
5-1 Generation Capacity Surplus “ee g oe wteces acerca nes care oe 5
5.2. Energy Capability Surplus) :2.../ctsgracecce oot tana oes ces eee ees ieer sn soem a aeerenerteaes 5
5:3; Alcan's Requirements 4: scccahossseer sees cosa scan Co caer see ace a saee eee ne anc rr at ee 5
5 Aa Role Gf Burrard coc. cote et a eee ae ican naan ee es esi er epee ieee ne 5
5 All aintegrated Systema yc pertetce tag ck reise sa ocue eh auccnac stents masa onne ant ae eee 5
5 POVeSVSlemr OUP POri am ee eter on ke tteee hee aelcc sar niccunauie be cwodsatesteeatenres tenn reams 5
54:38 System LoadinpiOrder, occ. aa. stead hee eee sone eee eens oe ee 6
5.5. Environmental Issucsememimrcerer cet rein ert trees sec ss here cancuenacreen tect aati teem 6
5:5. lL eRequisite Provincial Permitsies. ose eon ces dots e cases ee eee eee ee ee 6
5.5:2 ° .-Ambient Air Qualityarexcrs oer cree ret Sette aot ew ee cae daetec nate acenece tee aa eee 6
5.6.32 Burrard: bmissionvianacementc. <9 scseeson ee eee ene ee eee 6
5.5.4 Intervenors’ Concerns/Applicant’s Responses ................0ceececcescessecceseescecs i
5.5.5 Environmental Impacts of Hydraulic Generation ..................cececceeeceeeeeees Z.
5.5.6 Federal Standards and Guidelinesa 7... - ince. scenes eens cece tee ee eee 8
6, - Disposition stesso Jo cawak von bee eat tae cs oa APO en ek Se EER CRE Oe ne 9
G1 Surplus ooh 0F See ok ee ae Ee eee ora ee a ee 9
6.1.1 Impact of Burrard’s Availability and
Alcan’s Requirements scot ies tena eee reed en cbs sn ere 9
6:12". sExportof Firm:Capacityandinerpy ee... .csciscsse seta 0ccck. cs See 9
6.2* Environmental Issues eco vst ac eee ee ee ok ese oe eee 9
6.2.1 ProvinetaltPermitsysye2G Woosh eee isd sca dee sven Aen ee 9
6:2;2° “Air Quality and burrard: oinceestecosses toe ecc a. tesco enns teen ee 10
6:2:3alivdraulic Operations i ere eee eae eee 10
6.2.4 - Federal Standards aridiGuidelines (et... 5. ccs. .cce.0c0ce one cc sno ccc. eee 10
to The. Board's Findings ....3.: sie... died Bes Aas ee eras to oaeeaes oe 11
Appendices
1. Map of B.C. Hydro’s Main Generation and Transmission Facilities ..............cececesees 13
2. B.C. Hydro Estimated Dependable Capacity, Peak Demand and Surplus
for each month of the Licence Extension’ <4...) 4s. eee 14
3. B.C. Hydro Estimated Dependable and Average Streamflow Capability,
Demand and Surplus for each month of the Licence Extension ...............ceceeeceeeeeees 15

4. Amending Order A0-3-EL-162

POPC THREE HEHEHE HEHEHE EEE EHH HEHE EEO EEE TEETH HEHEHE EEE TES EEE EES EEE EE EEE

Units of Measurement
km

kV

AQI
Board

B.C. Hydro or
the Applicant

Bonneville
Burrard
Cominco

ECA

GVRD

NO,

Port Moody
SCL

SPEC
TransAlta

WKPL

(iii)

Abbreviations

kilometre (1000 metres)
kilovolt (1000 volts)

kilowatt hour (1000 watt hours)
gigawatt hour (1 000 000 kW.h)
megawatt (1000 kilowatts)

megawatt hour (1000 kW.h)

National Energy Board Act
Alcan Aluminum Limited
Air Quality Index

National Energy Board

British Columbia Hydro and Power Authority

Bonneville Power Administration
Burrard Plant
Cominco Limited

Kootenay Okanagan Electric
Consumers Association

Greater Vancouver Regional District

nitrogen oxides

City of Port Moody

Seattle City Light

Society Promoting Environmental Conservation
TransAlta Utilities Corporation

West Kootenay Power and Light Company, Limited

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Chapter 1

In December 1983 the British Columbia Hydro and
Power Authority applied to the National Energy
Board, in part, for a licence to export firm power
and energy to the United States for periods of up
to six years. Following a public hearing in March
1984, the Board issued firm export licence EL-162
to B.C. Hydro in July 1984. Licence EL-162 was
issued for only a four-year period because of the
uncertainties the Board perceived in respect of the
firm power requirements of Alcan Aluminum
Limited in the years 1988-89 and 1989-90. The
Board was not satisfied at the time it issued the
licence that there would be firm power and energy
surplus to reasonably foreseeable Canadian
requirements in the years 1988-89 and 1989-90 if
Alcan’s planned smelter expansion at Kitimat was
to proceed without a corresponding expansion of
Alcan’s generating facilities.

The Board also found in its July 1984 Decision
that there was uncertainty about the availability
of energy from the Burrard natural gas-fired ther-
mal plant because B.C. Hydro did not have all the
requisite provincial environmental permits to oper-
ate the plant. For these reasons, the Board was not
prepared at the time to give any credit for supply,
reserve, or surplus of capacity or energy that
might be generated at Burrard during normal
operations.

B.C. Hydro applied on 12 February 1988 for a

review of the Board’s July 1984 decision which
restricted the export of energy generated at the

EH-1-89 Electricity Export

Background

Burrard plant to emergency situations either in
Canada or the United States, testing, or for opera-
tional reasons. In May 1988 the Board found that,
because B.C. Hydro had obtained the requisite pro-
vincial environmental approvals to _ operate
Burrard, that is, to generate power for use in
Canada or for export, the environmental impact of
operation for export would be within the criteria
imposed by provincial authorizations. In conduct-
ing its review of the July 1984 decision, the Board
sought the views of the parties of record to the
original proceedings. The operation of Burrard was
examined through a comparison of the provincial
permits with the applicable federal standards and
guidelines. The Board was satisfied that the opera-
tion of Burrard was in compliance with the appli-
cable federal and provincial requirements and that
the provincial permitting process involved public
participation with the right of interested parties to
appeal. Consequently, the Board found that no fur-
ther limitations on the use of Burrard need be
imposed by conditions of the export licences and
appropriate licence amendments reflecting this
finding were issued.

A public hearing, to extend B.C. Hydro’s Licence
EL-162 to 30 September 1990, was held in
Vancouver, British Columbia on 6 and 7 March
1989. The Board issued its decision approving the
extension of Licence EL-162, subject to Governor
in Council approval, on 28 March 1989. This report
sets out the Board’s Reasons for Decision on B.C.
Hydro’s application.

Chapter 2

B.C. Hydro is a crown corporation operating in
British Columbia. The company provides electrical
service to most of the province, the main exception
being the area served by West Kootenay Power
and Light Company, Limited. The map included as
Appendix 1 shows the main generation and trans-
mission facilities of B.C. Hydro.

B.C. Hydro’s system is interconnected in the north
with the Alcan system at Kitimat, in the east with
the system of TransAlta Utilities Corporation, in
the southeast with the systems of Cominco Limited
and WKPL, and in the south with the system of
the Bonneville Power Administration. Bonneville
is an agency of the United States Government,
with extensive generation and transmission facili-
ties in the Pacific Northwest area of the United
States.

The Applicant

There are four international power lines connect-
ing the B.C. Hydro and Cominco systems to the
Bonneville system. Two 500-kV lines cross the
international boundary at Douglas, British
Columbia, near Vancouver, and two 230-kV lines
cross the border at Nelway, British Columbia. In
addition, B.C. Hydro owns an international power
line that supplies the isolated distribution system
of Puget Sound Power and Light Company in the
Point Roberts area of the state of Washington.

The export of power over these international power
lines is authorized by Licences EL-162, EL-163
and EL-164. The licences were issued to the
Applicant by the National Energy Board in July
1984. Licences EL-163 and EL-164 will expire on
30 September 1990, whereas EL-162 was dated to
expire on 30 September 1988

EH-1-89 Electricity Export

Chapter 3

By an application dated 10 August 1988, B.C.
Hydro applied to the Board for an extension to
Licence EL-162. The Board decided’ on
15 September 1988 that it would treat the applica-
tion as an application for review pursuant to sub-
section 21(1) of the National Energy Board Act to
vary Licence EL-162 and issued AO-2-EL-162
extending the licence for six months to allow time
for the review. The Board subsequently decided on
27 October 1988 to hold a public hearing to obtain
the evidence and views of all interested parties on
the application.

Board’s Explanatory Note

The Board first informed the public of its intention
to hold a hearing through the publication, in
November 1988, of a notice of an impending hear-
ing. The notice stated that the issues to be
addressed at the public hearing would be con-
tained in the Board’s hearing order to be issued at
a later date. Hearing Order EH-1-89, issued on
16 January 1989, stated that the Board wished to
ascertain whether the supply, demand and surplus

EH-1-89 Electricity Export

The Application

position of B.C. Hydro could permit the continued
export of up to 2000 megawatts of firm power and
6000 gigawatt hours of energy per year until
30 September 1990, including the specific consider-
ation of:

i) The extent to which B.C. Hydro intends to
depend on the supply of Burrard to export
firm power;

ii) The effects, if any, of the requirements of
Alcan Aluminum Limited on the demand of
B.C. Hydro;

iii) The environmental impact of generating the
power proposed to be exported under this
licence; and

iv) The status of the requisite provincial permits
to operate the Burrard generating station.

Included in the list of parties directly served with
the hearing order were the parties of record to the
original proceedings held under Order EH-1-84

Chapter 4

4.1 Motion to Request Federal
Department of the Environment
Participation in the Hearing

Mr. Ian Waddell, the Member of Parliament for
Port Moody/Coquitlam, submitted that the Board
did not have the resources to properly consider
whether there would be detrimental environmen-
tal impacts to Canada resulting from electrical
exports that might be made under the extended
term of Licence EL-162. Mr. Waddell further sub-
mitted that, as intervenors such as volunteer and
charitable organizations are limited in resources,
the Board should ask the federal Department of
the Environment to intervene in the hearing
because a fair hearing would not be possible with-
out that department’s expertise and resources.

Intervenor’s Motion

The Society Promoting Environmental Conserva-
tion, the Kootenay Okanagan Electric Consumer
Association, the City of Port Moody and two inter-
venors representing themselves supported the
motion. The Applicant opposed the motion.

4.2 Disposition of Motion

The Board reminded all parties that the hearing
would consider evidence on all matters, including
the environment. The Board stated that it recog-
nized the government’s recent establishment of
environmental matters as a priority and that, in
its review, the Board would re-examine the facts
and determine if current environmental require-
ments and norms are being met. The Board further
stated that it had the expertise to assess and test
the validity of evidence presented at the hearing.
Consequently, the Board denied the motion.

EH-1-89 Electricity Export

Chapter 5

5.1 Generation Capacity Surplus

The Applicant’s estimates of dependable power
capacity, peak demand and surplus power are
summarized in Appendix 2. In calculating the sur-
plus capacity available for export, B.C. Hydro
excluded supplies from Burrard because it lacked a
firm gas supply. B.C. Hydro did not include either
the demand of Alcan or any supply it might pro-
vide in the calculations of surplus for the reasons
detailed in Section 5.3. The supply and demand
balances take into account the Applicant’s own
load, plus its firm commitments to West Kootenay
Power and Light, Limited, transfers to Seattle City
Light under the Skagit River Treaty as well as a
capacity reserve credit reflecting B.C. Hydro’s 500-
kV interconnection with Alberta. Appendix 2
shows that the surplus capacity over the licence
extension period ranges from a monthly low of
261 MW to a monthly high of 2000 MW.

5.2 Energy Capability Surplus

The Applicant’s estimates of monthly energy capa-
bility, loads and surplus, under probable load
growth assumptions for both dependable and aver-
age streamflow conditions, are summarized in
Appendix 3. The evidence showed that, under both
dependable and average streamflow conditions for
any consecutive 12 months of the period April 1989
to September 1990, B.C. Hydro surpluses exceed
the 6000 GW.h export quantity permitted under
Licence EL-162. The Burrard station is included in
the calculation of available energy under both
dependable and average streamflows, as are trans-
fers to WKPL and SCL.

The evidence shows hydraulic surpluses under
average streamflows, but none, under dependable
conditions. Transfers to Alcan are excluded for the
reasons detailed in Section 5.3.

EH-1-89 Electricity Export

The Evidence

5.3 Alcan’s Requirements

As previously mentioned, the issuance in 1984 of a
firm export licence (EL-162), limited to a four-year
term, reflected, in part, the Board’s concern that
Aican might place additional firm load require-
ments on the Applicant in the years 1988-89 and
1989-90. Alcan, as an intervenor in the present
proceedings, stated that, barring emergencies, it
did not anticipate purchasing any power from B.C.
Hydro in the period covered by the export applica-
tion and that, on the contrary, Alcan expected to
have power available for sale to the Applicant until
at least 30 September 1990. The Applicant stated
that it is negotiating with Alcan to purchase part
or all of Alcan’s firm surplus.

5.4 Role of Burrard

5.4.1 Integrated System

The Applicant stated that the source of B.C.
Hydro’s exports will be from the integrated gener-
ating system of which the 912-MW Burrard station
is a part. Because Burrard is a high-cost generat-
ing station it is used only when required. The
annual Burrard capability of 5520 GW.h comprises
3430 GW.h generated from off-peak gas purchases,
while the remaining 2090 GW.h comes from gas
purchased at regular market prices. Supply can
also be supplemented by purchases from Alcan and
Alberta.

Currently, 450 MW of the Burrard station’s units
are operated as synchronous condensers to lend
stability to B.C. Hydro’s transmission system.

5.4.2 System Support

The Applicant stated that the domestic load had
grown to a point where, very shortly, hydraulic
capability would not be able to fully supply the
firm domestic load. At that point the firm energy

capability of Burrard would be required to supple-
ment the hydraulic system.

In addition, the evidence showed that at this time
the principal roles for Burrard are as follows:

- emergency back-up during outages;

- emergency supply in poor water years;

- voltage support for the Vancouver area; and

- system back-up should new projects be delayed.

5.4.3 System Loading Order

The Applicant’s evidence showed that, in loading
its system, resources are allocated on the basis of
cost. The Burrard station, because of the relatively
high costs associated with its operation, is one of
the last stations loaded. However, the witness for
B.C. Hydro stated that, because the use of Burrard
is dependent upon the cost of energy available
from other sources, it is not necessarily the last
station loaded onto the system and that the cost of
supply from Alcan or Alberta may vary the actual
loading order.

Thus, exports, if any, would first be made from
hydraulic surpluses on the B.C. Hydro system
before other sources of supply such as Alcan,
Alberta coal or gas-fired generation, or additional
energy available from the Burrard station at appli-
cable peak gas prices would be utilized. The wit-
ness for B.C. Hydro stated that exports from any
particular source would be dependent upon market
conditions.

5.5 Environmental Issues

5.5.1 Requisite Provincial Permits

The evidence showed that, under the British
Columbia Waste Management Act, B.C. Hydro
requires two environmental permits for the use of
the Burrard plant. The first is an effluent permit
(PE-7178) which was issued in 1985 and does not
require renewal. That permit sets limits for cooling
water discharge temperatures, discharge volumes
and miscellaneous wastes from the Burrard plant
as well as the monitoring of Burrard Inlet in the
vicinity of the plant.

The second permit required is an air emission per-
mit (VA-330) issued by the Director of the Greater
Vancouver Regional District specifying air emis-
sion limits. This permit provides for the curtail-

ment of the operation of Burrard in the event of
poor ambient air quality. All permits issued by the
GVRD require periodic renewal. B.C. Hydro had
applied to the GVRD for an extension of the air
emission permit beyond its expiry date of 30 April
1989. The GVRD permitting process is a public
procedure.

There is also a Provincial Energy Removal
Certificate in effect which allows energy to be
exported until 30 September 1990.

5.5.2 Ambient Air Quality

B.C. Hydro’s evidence showed that the GVRD oper-
ates an air quality monitoring network to provide
continuous measurement of air pollution levels in
the Greater Vancouver area. The GVRD evaluates
the regional air quality using provincial criteria
which are consistent with air quality objectives
established by the federal Department of the
Environment. The federal objectives define the lev-
els of contaminant concentration as Maximum
Desirable, Maximum Acceptable and Maximum
Tolerable.

The index pollutants measured are sulphur diox-
ide, carbon monoxide, nitrogen oxides, ozone and
suspended particulates. There is also a short-term
daily air quality index (AQI) calculated from cur-
rent hourly air quality measurements of the gase-
ous index pollutants.

The Applicant’s evidence indicates that, for the
most part, air quality in the Greater Vancouver
Region meets the federal air quality objectives.
Measurements exceeding objectives occur infre-
quently and are associated with poor atmospheric
dispersion during the fall and winter and with the
occurrence of photochemical episodes in the
summer.

B.C. Hydro’s evidence showed that the GVRD and
the provincial government have entered into a two-
stage air management planning project. Stage one,
scheduled for completion in mid-1989, will identify
air quality problems and general air management
needs while stage two will assess future emission
control strategies and procedures to achieve goals.

5.5.3 Burrard Emissions Management
The Applicant’s evidence showed that the opera-

tion of Burrard is currently regulated by an ambi-

EH-1-89 Electricity Export

ent control regime based on nitrogen dioxide meas-
ured in the vicinity of the plant. Through the ambi-
ent air control program, the operation of Burrard
is curtailed when the GVRD AQI index reaches 50,
a limit equal to the federal Maximum Acceptable
quideline. Combustion modification techniques
have resulted in a 40 percent reduction in the of
emission of nitrogen oxides and studies are contin-
uing to investigate additional emission reduction
with the objective of making Burrard the cleanest
plant of its type in North America.

5.5.4 Intervenor’s Concerns/Applicant’s
Responses

The Board heard interventions at the hearing from
SPEC, the ECA, the Liberal Party of British
Columbia, Judicial Action, Mr. I.G. Waddell, M.P.,
and Messrs. Bing and Black who represented
themselves. Others who had stated their intention
to intervene did not participate at the hearing or
were satisfied that their concerns were addressed
through the GVRD air quality permit system.

SPEC, ECA, Mr. Waddell, M.P., and Mr. Bing
raised concerns about air quality, visual pollution
and the emissions of nitrogen oxides, ozone, carbon
monoxide and other trace emissions. The Liberal
Party of British Columbia supported the applica-
tion provided that the price of exports results in
the people of British Columbia receiving the fullest
value possible, due them by their ownership, while
maintaining the long-term environmental integrity
of the province. The party also believed the use of
existing generating facilities in British Columbia
should be maximized, prior to the construction of
additional generation in the province. Mr. Black
expressed his concerns about B.C. Hydro’s pre-
building generation and exporting power from
these facilities at prices below cost with the subse-
quent transfer of the pre-building costs to domestic
residential customers. Judicial Action stated that
the energy exported could be better used for alter-
native purposes to serve the people of British
Columbia at affordable prices.

SPEC stated the Burrard plant should be shut
down sooner than required under the AQI because
pollution readings generally keep rising even after
a plant is shutdown during periods of atmospheric
stagnation. Mr. Waddell, M.P., Mr. Bing and SPEC
felt that Canadians pay a price in air quality deg-

EH-1-89 Electricity Export

radation and suffer from visual pollution each time
Burrard is used for export purposes and that
export commitments should be met without the
use of Burrard. B.C. Hydro argued that the opera-
tion of Burrard is regulated under its air emission
permit which requires the curtailment of the oper-
ation of Burrard whenever the GVRD Air Quality
Index exceeds the federal Maximum Acceptable
guideline.

SPEC, ECA and Mr. Waddell, M.P., and Mr. Bing
also expressed concerns over the contribution of
Burrard to NOx emissions in the Vancouver
Region and stated that NOx emissions lead to
health, environmental and economic problems.
However, B.C. Hydro’s environmental evidence
showed that the operation of Burrard meets all
current applicable federal and _ provincial
standards.

In response to some of the intervenors’ concerns
about ground level ozone impacts on health and
agriculture, B.C. Hydro stated that the Burrard
station was not a major contributor to ozone pro-
duction and testified that it is developing control
strategies to further minimize the impact of
Burrard on ozone production.

ECA and Mr. Waddell, M.P. voiced concerns about
other emissions from Burrard such as carbon mon-
oxide and hydrogen sulphide. B.C. Hydro’s witness
testified that fuel combustion controls reduce the
production of carbon monoxide and that carbon
monoxide monitors are being installed at the plant
to assist in the combustion control program. B.C.
Hydro stated the contribution of Burrard emis-
sions to sulphur compounds is very low because
the gas supply for the plant is essentially sulphur-
free.

5.5.5 Environmental Impacts of
Hydraulic Generation

B.C. Hydro was questioned about any environmen-
tal impacts due to exports resulting from hydraulic
generation. The Applicant testified there had been
no significant changes in its hydraulic generating
system since the 1984 hearing and that environ-
mental impacts of hydraulic generation will not
change under the proposed extension of Licence
EL-162.

5.5.6 Federal Standards and Guidelines

Evidence was presented by B.C. Hydro which com-
pared the operation of Burrard with the relevant
federal environmental standards and guidelines.

Federal standards establish limits on concentra-
tions of pollutants in the ambient air. The evidence
showed that B.C. Hydro’s requirement to curtail
operations under the GVRD air emissions permit
during the proposed licence extension period is a
standard exceeding that of similar fossil fuel-
burning plants in the region. B.C. Hydro’s evidence
comparing Burrard with guidelines for new sta-

tionary sources of fossil-fuel electricity generating
plants showed that Burrard meets applicable fed-
eral requirements.

The operation of Burrard was also compared with
the applicable provisions of the federal design
phase code for new plants. The evidence showed
that B.C. Hydro’s discharges under the provincial
effluent permit conform to the relevant recommen-
dations of the federal design phase code. As well,
the provincial monitoring program under the efflu-
ent permit conforms with the applicable provisions
in the federal design phase code.

EH-1-89 Electricity Export

Chapter 6

The Board has given consideration to all the evi-
dence and submissions presented and has reached
the following conclusions.

6.1 Surplus

To ascertain whether B.C. Hydro could export up
to 2000 MW of firm power and up to 6000 GW.h
energy-per year during the proposed licence exten-
sion period, the Board examined B.C. Hydro’s esti-
mated supply, demand and surplus position to
30 September 1990.

6.1.1 Impact of Burrard’s Availability
and Alcan’s Requirements

The Board is satisfied that its earlier concerns over
the availability of energy from Burrard, which led
the Board to not giving credit for supply, reserve or
surplus for capacity or energy that might be gener-
ated at Burrard, no longer exist. The Board notes
the Applicant’s requirement for the Burrard plant
for system support and to supplement its hydraulic
generation system. Accordingly, the Board recog-
nizes the possibility that any surplus available for
export may include electricity generated at the
Burrard plant.

In addition the Board notes that Alcan’s require-
ments up to 30 September 1990 can be met from
Alcan’s own generation. Accordingly, the Board is
satisfied that those requirements no longer need to
be considered in the Board’s examination of
surplus.

6.1.2 Export of Firm Capacity and
Energy

The Board finds that the Applicant’s estimates of
capacity under dependable streamflows, and of
energy capabilities under both dependable and
average streamflows along with its estimates of
firm commitments and probable load growth
assumptions are reasonable.

EH-1-89 Electricity Export

Disposition

With respect to the export of firm capacity, the
Board notes that, in most months during the pro-
posed export period, B.C. Hydro’s estimates of sur-
plus capacity under dependable streamflows are
less than 2000 MW. However, the Board is satis-
fied that, in some months B.C. Hydro could export
up to the requested 2000 MW and that, in other
months, some surplus capacity is available for
export. With respect to the export of firm energy,
the Board is satisfied that B.C. Hydro could export
up to 6000 GW.h in any consecutive 12-month
period to 30 September 1990.

The Board has taken into consideration interven-
ors’ concerns about exports from Burrard and
notes that the plant’s use for export purposes will
largely be determined by the marketplace for elec-
tricity and that its use for export will likely be
minimal due to the high cost of Burrard genera-
tion. The Board notes that firm export Licence
EL-162 is conditioned to ensure there is a pre-
mium charged for incremental production from
Burrard and such a condition would continue to
apply to any licence extension issued hereunder.

6.2 Environmental Issues

6.2.1 Provincial Permits

The evidence submitted with the application shows
that B.C. Hydro has all the necessary permits to
operate Burrard to generate power for use in
Canada or for export. These include an effluent
permit, an amended air emission permit and an
energy removal certificate. The Board is aware
that the air emission permit is being reviewed by
the GVRD and notes that B.C. Hydro will have to
secure the appropriate renewal of the air emission
permit before exports from Burrard generation can
be made. The Board is satisfied that the GVRD
permitting process addresses the appropriate tech-
nical aspects of the air quality issue and involves
public participation.

6.2.2 Air Quality and Burrard

The Board notes that the GVRD measures air pol-
lution and controls the operation of Burrard based
on a daily air quality index which is equivalent to
the federal Maximum Acceptance Level and that
the GVRD along with the provincial government
are conducting a long-term air management study
to assess future air control strategies. The Board
accepts the Applicant’s undertaking to ensure that
Burrard will conform to the air control strategies
that will evolve.

From its examination of the evidence, the Board
concludes that the air quality in the Greater
Vancouver Region complies with federal air quality
objectives at most times and that measurements
exceeding the objectives occur infrequently under
adverse weather conditions. Because of the emis-
sion controls imposed on the operation of Burrard
by the GVRD, the Board is satisfied with the use of
the Burrard plant to satisfy domestic or export
requirements. The Board recognizes that to satisfy
B.C. Hydro system requirements the Burrard
plant may be operating while exports are taking
place.

The Board also notes the Applicant’s undertakings
to minimize the impact of Burrard as a contributor
to the production of ozone. The Board believes that
intervenors’ concerns about the impact of Burrard
air emissions on health and agriculture are being

10

addressed by B.C. Hydro’s air emission reduction
program, by its studies, to the extent that these
may lead to further reduction of these emissions
and by the GVRD’s air quality monitoring program
under the air emission permit..The Board further
notes the Applicant’s installation of monitoring
devices to assist it in the control of gaseous emis-
sions from the plant.

6.2.3 Hydraulic Operations

The Board is satisfied that the incremental envi-
ronmental effects resulting from hydraulic exports
under the proposed licence extension will be negli-
gible since B.C. Hydro’s facilities and operations
have not changed in any significant respect since
the Board’s July 1984 decision.

6.2.4 Federal Standards and Guidelines

Although federal standards and guidelines relate
to new plants, the Board examined the federal
standards and guidelines and recognized them as a
benchmark against which to evaluate the perfor-
mance of Burrard. Based on its examination, the
Board is satisfied that Burrard meets the applica-
ble guidelines for ambient air pollution for new
stationary generating sources. The Board also com-
pared the operation of Burrard with federal design
codes for new plants and is satisfied that provin-
cial monitoring conforms with the applicable
design codes.

EH-1-89 Electricity Export

Chapter 7

EH-1-89 Electricity Export

The Board’s Findings

The Board has satisfied itself that the power and
energy that may be exported are surplus to reason-
ably foreseeable Canadian requirements and that
the operation of Burrard will meet applicable fed-
eral environmental standards and guidelines, and
has considered all other matters that appear to be
relevant. Accordingly, on 28 March 1989, the
Board issued to B.C. Hydro, subject to Governor in
Council approval, an extension to 30 September
1990 of the continuing export of up to 2000 MW of
power and up to 6000 GW.h of energy in any con-
secutive 12 month period allowed under Licence
EL-162. Amending Order A0-3-EL-162 is attached
as Appendix 4.

The foregoing constitutes our Reasons for Decision
and decision in the matter of the present applica-
tion of the British Columbia Hydro and Power
Authority pursuant to Section 21 of the National
Energy Board Act.

A.B. Gilmour
Member

D.B. Smith
Member

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EH-1-89 Electricity Export

Appendix II

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EH-1-89 Electricity Export

14

Appendix III

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OUI JeMOd PUE O/PAH BIQUIN|O.) USING

Appendix IV

IN THE MATTER OF the National Energy Board
Act and the Regulations thereunder; and

IN THE MATTER OF an application by the
British Columbia Hydro and Power Authority
(B.C. Hydro) pursuant to subsection 21(1) of the
National Energy Board Act, to vary Licence
EL-162; filed with the Board under File No. 1923-
B7-7.

WHEREAS the National Energy Board has issued
to B.C. Hydro Licence EL-162, as amended, for the
exportation of firm power and energy at points on
the international boundary between Canada and
the United States of America;

AND WHEREAS B.C. Hydro by an application
dated 10 August 1988 has applied for an extension
of Licence EL-162;

AND WHEREAS the Board has issued an exten-
sion to 30 March 1989 of Licence EL-162 to allow
time for a review, pursuant to subsection 21(1) of
the National Energy Board Act, for a further
extension of Licence EL-162 to 30 September 1990;

AND WHEREAS a public hearing for a review, has
been held commencing on the 6th day of March,
1989, in the City of Vancouver, in the Province of
British Columbia, at which B.C. Hydro and all
interested parties were heard;

16

ORDER NO. AO-3-EL-162

AND WHEREAS the requested amendment would
not increase the total annual quantity of energy
authorized for export under Licence EL-162.

AND WHEREAS B.C. Hydro currently has posses-
sion of the required environmental operating per-
mits under the provincial Waste Management Act;

AND WHEREAS B.C. Hydro has _ requested
renewal of the Air Emission Permit expiring 30
April 1989 from the provincial authorities;

AND WHEREAS the Burrard Generating Station
may not be operated without B.C. Hydro possess-
ing all the required environmental operating
permits;

IT IS ORDERED THAT Licence EL-162 be
amended by revoking Condition 1 therefrom and
substituting therefor the following:

“1. The term of this licence shall commence on
the date of revocation of Licence EL-128, and
shall end on 30 September 1990.”

Issued under subsection 21(2) of the National

Energy Board Act, in the City of Ottawa, in the

Province of Ontario, on 28 March 1989.

NATIONAL ENERGY BOARD

Louise Meagher
Secretary

EH-1-89 Electricity Export

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