BCUC rejects low-carbon heating plan
Developer Ian Gillespie says the B.C. Utilities Commission’s latest rejection of his proposed lowcarbon district energy system for downtown Vancouver is but a “minor blip” in his overall plan to dramatically rewrite how homes and businesses are heated in the city.
Gillespie, who bought a legacy natural gas central heat distribution system two years ago with a grand scheme to expand and convert it to biofuel, said Tuesday he is not only unbowed by this third BCUC rejection, but also re-energized.
“Call me misguided, but I actually get a little bit more encouragement from it because change is difficult,” he said. “Having a little bit of headwind is just another opportunity for us to say why this is so important. We are going to double down our efforts and we will be under construction in the near future.”
Gillespie believes the commission is on the wrong side of history by rejecting an application from his Creative Energy Vancouver Platforms to expand hot water heat services to much of the downtown peninsula.
The plan is tied to a proposed neighbourhood energy bylaw that would require property owners to hook into the system. The system would be fed by a new biomass energy facility Gillespie plans to build on city-owned land in east False Creek. Building it would allow Creative Energy to get off of natural gas boilers.
BCUC chairman and CEO David Morton said the commission doesn’t like the precedent the application creates.
“We do have jurisdiction over whether an agreement between Creative Energy and the city is in the public interest and, in this case, because we found the neighbourhood energy agreement would be imposing those monopolistic elements, that is not in the public interest,” he said.
But Gillespie, known for building provocative developments and pushing the boundaries of architecture, said he views conversion of the city’s legacy energy systems to more environmentally friendly concepts as a long game.
From the oil and natural gas industry to pipeline distribution systems, the owners of existing infrastructure are trying to protect their turf and the BCUC is enabling them to do that, he believes.
“What this is telling me is that the old economy is going to dig in and fight. And guess what? We’re going to have 10,000 of these little quarrels across the country over the next 20 years as we make this transition to a low-carbon energy environment,” he said. “The fact of the matter is that in a couple of years from now there will be a new plant in the False Creek flats, it will be a biomass plant that will be producing a lot better carbon footprint for Vancouver than we have today, and the district energy network will have expanded significantly from where it is today.”
The commission expressed concerns it was being dragged into supporting the city’s proposed neighbourhood energy bylaw, saying it has no jurisdiction over zoning and planning matters.
The bylaw, which has not yet been enacted, would require building and condo owners to purchase heat from Creative Energy as it expands.
Morton found that Creative Energy didn’t need a monopoly.
“There was evidence provided in the hearing of a number of other ways that this energy could be provided by other providers,” Morton said in an interview. “Of that evidence that we looked at, (the competitors) met the same greenhouse gas reduction targets that Creative Energy is proposing.
“... The BCUC is not standing in the way of a low carbon energy system in this case. We have never stood in the way of clean energy. The issue here is that this franchise established a monopoly and we didn’t think that to be in the public interest,” he said.
Morton said the commission has no trouble with low-carbon systems and has approved building-specific geo-exchange systems throughout the province. It just has trouble with the idea that Creative Energy’s system would be tied to a city ordinance requiring mandatory hookup without any other options.
In its ruling released Monday, the commission reaffirmed two previous decisions rejecting Creative Energy’s plans to create a district energy system extending deep into the densest residential areas downtown.
Morton said Creative Energy and the city still have several alternatives, including enacting its energy bylaw and requiring mandatory hookup, which is beyond BCUC jurisdiction. It can also take over Creative Energy and run it as a municipal utility, which is also beyond the scope of the commission, he said.
Jerry Dobrovolny, the city’s general manager of engineering services, said the city was “deeply disappointed” by the commission’s decision. City staff are examining the options and will report to council next month.
But Dobrovolny said simply enacting the bylaw may not be the best option because it would provide no long-term security for a low-energy system.
Trent Berry, the chairman of Creative Energy’s board of directors, said the company is exploring other options.