B.C. Hydro contractors have run into “geotechnical and construction challenges” that mean the Site C dam project will not be able to make its target of diverting the Peace River in the summer of 2019.
B.C. Hydro president Chris O’Riley confirmed the delay in a letter to the B.C. Utilities Commission, estimating an extra cost of $610 million that brings the total estimate to $8.9 billion for the most expensive construction project in B.C. history.
O’Riley said there is enough money in the project’s contingency fund for the cost, and a “one-year float” in the project schedule means it can still be completed as scheduled by November 2024. Other risks remain, including a road realignment to avoid evicting the last two holdout farming couples who live on the narrow riverside land and have already been paid in an expropriation to make way for the dam.
“Due to the project’s complexity, we expect to continue to face risks in other areas, including our second largest procurement (i.e. the generating station and spillway) that remains open and the highway realignment,” O’Riley wrote. “We will work to mitigate those challenges.”
The project is undergoing a review by the commission on the orders of Premier John Horgan, who made it a prominent issue during his years as NDP opposition leader. Under a tight deadline of Nov. 1 to make recommendations to the B.C. cabinet, the commission has already noted that Site C has been drawing heavily on contingency funds to deal with a tension crack in the riverbank and other issues.
Energy Minister Michelle Mungall said the delay is not a result of the NDP government’s review, ordered after former B.C. Hydro CEO Jessica Macdonald was fired this summer. The new government has commissioned reports on the cost of delaying or abandoning the project, which O’Riley says should continue after two years of work and nearly $2 billion spent.
“Despite the challenges we have encountered and the risks that remain, our analysis continues to confirm that completing Site C as planned is still the most cost-effective option for our customers,” O’Riley said. “Suspending or terminating and finding the power we need from other sources – which carries its own set of uncertainties – would cost billions more than completing Site C.”