B.C.Â’s untapped resource: wind

BRITISH COLUMBIA - There is a motherlode of wind energy resources in northeastern British Columbia, and developers are standing by.

Now, this largely unknown and untapped reservoir needs buyers, if the provincial government hopes to come close to its goal to make B.C. a renewable energy powerhouse in North America.

It's an ambitious — even distant — goal.

B. C.' s hydro-focused electricity sector lags Europe, North America and the rest of Canada for wind power development despite opportunities that developers believe would make B.C. home to some of the world's largest wind farms.

The Global Wind Energy Council says in its most recent status report that the global wind market grew by 41 per cent last year despite a global economic downturn. For the past three years wind has been the fastest growing power technology in Europe.

"Last year in the United States, wind was the largest single source of new electricity capacity," Robert Hornung, president of the Canadian Wind Energy Association, said in a telephone interview. " It had been second to natural gas for three years and last year was the first year it caught up."

This week at the annual conference of the American Wind Energy Association, its executive director said wind power is "on the edge of explosive growth" as the U.S. federal government considers a national standard requiring all utilities to derive at least 15 per cent of their power from green sources.

The global wind council reported that wind projects in 2009 accounted for $2 billion of new investment in Canada and noted that Canadian wind farms now generate enough electricity to power more than 1.1 million homes.

The global wind council dubs Ontario, which this year introduced a Green Energy Act offering premium rates for new renewable electricity supply, "Canada's Leading Wind Energy Province."

B.C.' s contribution has been, by contrast, marginal, with two operational wind farms to date.

BC Hydro customers in this province won't drive greater wind development — at least not for the foreseeable future.

The Crown utility said last month that it expects to hit the next decade's worth of electricity supply and conservation targets set out by Premier Gordon Campbell's Liberal government and has no immediate plans to follow up on the 2008 call for power which is now all but complete.

That leaves exports as the driver of large-scale wind development, with Alberta, California and some other Western U.S. jurisdictions looking to fill out their renewable electricity portfolios.

B.C. Energy Minister Blair Lekstrom said it is "significant" that there are 250 active IUPs or investigative use permits allowing developers to measure potential wind resources around the province.

"The northeast is probably one of the best places, not just in B.C., but probably on the planet, with what we are seeing up there."

Juergen Puetter, president of Aeolis Wind, raves about the northeast winds that roll down off the eastern ridges of the Rocky Mountains and spill unimpeded across the northern Alberta prairie.

"Wind energy is like real estate. It's location, location, location," Puetter said in a telephone interview. "On the trailing foothills of the Rockies, really the last two ridges of the Rocky Mountains, it's the sweet spot of North America.

"When you find a tree where the branches only go one direction, on top of a mountain ridge, you know you have hit pay dirt. That is really the ultimate so-called flag, and the Peace is full of that."

Aeolis was the developer of B.C.'s most successful wind project to date, Bear Mountain, but failed to win a contract from Hydro in the 2008 clean call with its followup, Thunder Mountain.

Thunder Mountain is massive — Puetter proposed an initial 600-megawatt wind farm and left room for a second phase at 400 megawatts.

At full capacity with both phases commissioned, the Thunder project would produce more electricity than BC Hydro's $6.6-billion Site C dam project on the Peace River and would easily surpass the proposed $2-billion Shepherds Flat, Oregon, wind farm as the world's largest.

Aeolis had everything lined up to begin construction for Thunder Mountain, including financing, reams of wind movement data, and an approval from B.C.'s environmental assessment office, but was told its price had to come down.

That proved impossible, so Aeolis began looking for markets outside the province. It didn't take much effort to find one, Puetter recalled.

"On April 1 we found that we were not part of the [clean call] project. Less than three weeks later we went down to California and got a positive feedback from them," he said.

"I am able to offer now — without the restrictions that the BC Hydro call put on us — power at a price that's got the California guys doing a double take. They want the power."

Lekstrom agreed that export markets could be the key to opening up B.C.'s wind sector.

The Liberals' Clean Energy Act, now working its way through the legislature, sets up a business arrangement wherein Hydro will work with developers to identify export markets, strike contracts with buyers and sellers, and then put Hydro in the role of middleman, aggregating power from independents and then dispatching it to markets outside the province.

"We will go out and secure the long-term contract and then we will go secure the power to supply those contracts. I think the opportunity is significant for projects [such as]... Thunder Mountain, if we don't need it [domestically]," Lekstrom said.

"Cost is a different issue when you look outside of British Columbia because we are dealing with extremely low electricity prices that we are going to maintain here. Other jurisdictions don't have that comfort so they are willing to pay some more for power that we can generate here."

Chinook Power Corp., which did the initial research and development of Capital Power's Quality Wind project, can't wait.

Chinook chairman and CEO Stephen Cheeseman started his company "from scratch" in 2003. He describes its business model as similar to a junior mining company — identifying a resource, refining it and then selling the project to a larger, well-capitalized investor who can carry it to production.

Cheeseman's ambition is to expand Chinook from a grassroots operation to one that will have the resources to hire employees and build its own projects.

"It looks like the government is trying to create, as Gordon Campbell called it, a clean energy powerhouse. The question is whether or not that will happen. I think Ontario is farther ahead," Cheeseman said in a phone interview.

"For a revenue base, if we can create jobs, tax revenues for the government, and do it properly in a sustainable manner, then I think that's good.

"Obviously from our point of view we would like to see success. I've been at this for seven years and we are just starting to see a little bit of it. I feel for some of the companies that haven't made it."