here, the B.C. government's new Natural Gas strategy and LNG strategy released last week set out
significant new details on the province's plans to develop its
natural gas resources and promote the LNG export industry.
One key point of the strategies is the steps the government will
undertake to ensure the availability of sufficient, clean,
British Columbia's 2007 Energy
Plan had set a goal of self-sufficiency for B.C. Hydro by 2016.
The plan specifically mandated that B.C. Hydro plan for sufficient
generation within British Columbia to ensure self-sufficiency even
in years when inflow to reservoirs was extremely low, and that
Hydro acquire an additional 3,000 GWh per year of
"insurance" generation by 2020.
The LNG strategy reverses the 2007 Energy Plan on these points.
The LNG strategy notes that the 2007 Energy Plan was written at a
time when electricity prices were very high, and that the goals do
not make sense in a market where natural gas is relatively cheap
and generation (particularly subsidized renewables) in the United
States are overbuilt. Accordingly, B.C. Hydro will be required to
plan based on average inflow to reservoirs, and will not be
required to acquire the additional generation. Any shortfall in
electricity will be made up by imports.
The LNG strategy estimates that electricity rates will be
reduced by approximately 8% by 2016 and 20% by 2020 as a result of
the changes to the Energy Plan.
The biggest losers in the strategy may be independent power
producers in B.C. The 2007 Energy Plan was responsible, in part for
the surge in IPP projects over the last several years, and
abandoning the requirement for self-sufficiency may reverse or end
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Canada is a constitutional monarchy, a parliamentary democracy and a federation comprised of ten provinces and three territories. Canada's judiciary is independent of the legislative and executive branches of Government.
The Government of Alberta recently announced a number of policy changes that will impact the Alberta Electricity Market, composed of its generators, transmitters, distributors, retailers, electricity consumers and wholesale electricity market.
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