December 4, 2017
Premier John Horgan and Cabinet
Government of British Columbia
PO BOX 9041
STN PROV GOVT
VICTORIA, BC V8W 9E1
Via email and by hand
Dear Premier Horgan and Honorable Ministers:
Thank you for the opportunity to meet with you and your cabinet. Although I have worked with Canadian clients for many years, this was the first time to have the chance to help government officials in such a challenging situation.
As I noted during the meeting, I approached the opportunity in the same way I would approach meeting a client – oriented primarily towards problem solving and less towards advocacy.
As I noted on Thursday, three provinces and one state have recently faced similar challenges. In Quebec and Nebraska, the government faced the issue of a troubled investment squarely. When the downside risks are large and growing, it is generally best to limit your exposure. In Quebec and Nebraska, a bond rating downrating was avoided by prompt action. Rate increases were effectively eliminated through the availability of cheaper alternatives. In Manitoba and Newfoundland, the government indeed found itself "Waist Deep in the Big Muddy" and have faced rating downgrades and significant rate increases.
At the heart of the debate is a change in the industry that many find hard to adjust to. After being told for many years that energy is scarce and limited, we find that with the amazing decline in renewable prices that we can produce as much electricity as we need. British Columbia Hydro places the wind potential of the province at 15,898 megawatts -- roughly fourteen times the capacity of Site C. Not all of this is available on peak, of course. Hydro-Quebec, Canada's leading wind developer, counts 30% of name plate capacity as dependable capacity which equates to four and a third times the usable capacity of Site C. To be clear, the nameplate capacity of proven renewables is sufficient to meet all of our forecasted decarbonization and electrification goals, even if it amounts to over four times the capacity of Site Cs. And this is before taking into account other renewables such as solar and geothermal. British Columbia is awash in untapped renewable potential.
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 The Omaha Public Power District is a governmentally owned and operated utility – comparable to a Canadian crown corporation.
 Lazard’s levelized cost of energy analysis—Version11.0, November 30, 2017, page 10.
 BC Hydro Wind Data Study CSRP0009-A, May 1, 2009, page 44.