Given that we do not need the energy, the environmental damages are enormous and we appear to be breaking a treaty, the ECOreport asks: “Why Do the Liberals Push Site C?”
(Originally Published Feb 28, additional information added under “SNC Lavalin” on March 5, 2015)
By Roy L Hales
According to a recent report from the University of British Columbia, “Site C has more significant adverse environmental effects than any project ever reviewed under the history of the Canadian Environmental Assessment Act, including impacts on dozens of species, aquatics, vegetation, wildlife, Aboriginal use of lands and resources, and cultural heritage.” The British Columbian and Canadian governments are most likely breaking treaty #8, which gave local first nations usage of the land that will be submerged. BC Hydro has not properly evaluated less destructive, and far less expensive, alternatives like geothermal energy. We won’t need the power for decades, if ever. Yet retiring Energy Minister Bill Bennett says “Site C is probably the most important thing” he has been associated with and Premier Christy Clark vows to push this project beyond the point where a future government could reverse her decision. So why do the Liberals push Site C?
Why Do the Liberals Push Site C?
One might ask to what extent the BC Liberals are a continuation of the province’s old Social Credit party?
The Peace River’s first big dam was built by former Premier W. A. C. Bennett in 1968. As BC Hydro now admits, this project “inundated the forests and the waters which were the traditional and the current home of a number of First Nations communities” – but it also provided cheap power.
More was known about negative environmental impacts by the early 1980’s, when W.A.C.’s son, former Premier Bill Bennett, first proposed building a new mega-dam at Site C.
The B.C. Utilities Commission turned the project down in 1983 and again in 1989, saying the power was not needed.
In 1993, BC Hydro’s board of directors announced the project was too expensive, too environmentally destructive and would cause too much damage to lands used by for First Nations.
Things changed after Premier Gordon Campbell was elected at the head of an anti-NDP coalition supported by corporate interests and old provincial Socreds. Campbell resurrected the Site C Dam project in 2010, pointing out that the Bennett’s vision of a massive infrastructure of hydroelectric dams “liberated a whole series of economic activities” and “was really part of a critical industrial strategy for all of British Columbia,”
Clark inherited the project when she became premier and appointed Bill Bennet’s son, Brad, as Chairman of BC Hydro.
B.C. Hydro’s Liberal Party Connections
He was one of many politically motivated appointees to BC Hydro. Brad Bennett was both a key advisor and Clark’s constant companion during the last election campaign. His predecessor as Chairman of BC Hydro, Dan Doyle, went on to become Clark’s Chief of Staff in 2012.
BC Hydro’s current CEO, Jessica McDonald, directed Gordon Campbell’s campaign for the Liberal leadership and was his government’s top official from 2005 to 2009. She was his deputy minister to the Premier, cabinet secretary, and head of the public service.
Her ex-husband, Mike McDonald, “led Clark’s winning leadership campaign team in 2011, then guided her transition team, and served as Chief of Staff to the Premier. In 2013, he led the Premier’s successful election campaign …” He subsequently became a senior associate with Kirk & Co, which had just finished designing and executing “a comprehensive public consultation program” for the proposed Site C Dam (2007-2013).
(In response to queries about her association with the BC Liberal party, Jessica McDonald says, “I don’t identify myself with a political party. I have never been a member of a political party.”)
- Bill Adsit – $1,000 on November 30, 2016
- (Chairman) Brad Bennett contributed:
- $425 on October 30, 2016, and
- $300 on December 31, 2016
- Though James P. Hatton has not made any personal donations, he is a partner at Farris, Vaughan, Wills & Murphy LLP which donated:
- $500.00 on Feb 2, 2016
- $2,000.00 on February 29, 2016,
- S1,500.00 on April 1,
- $10,000.00 on June 27, 2016 and
- $5,000.00 on October 31, 2016
- John Knappet donated $300 on December 5, 2016
- Valerie Lambert contributed:
- $1,000 on January 1, 2016 and
- $1,000 on Dec 31, 2016
- Jack Weisgerber is the former Minister of Energy and Mines, under Campbell, who BC Hydro paid $750,000 in consulting fees between 2007 and 2013. A “Jack Weisgerber” donated $20 on November 15 and a “John Weisgerber”contributed another $500 the same day. Are they the same man?
While these are trivial amounts, compared to the hundreds of thousands from the BC Liberal party’s top 50 contributors, they illustrate the extent to which BC Hydro’s leadership is an expression/extension of the Clark Government.
BC Liberal Party Donations
In a like manner, British Columbia’s Government appears to have become an expression/extension of corporate interests. Big corporations donated $46 million to Liberal campaigns over the past eight years. The Vancouver SUN reports that 21 of the BC Liberal’s 50 largest contributors are developers (which may explain the province’s failure to curb rising real estate prices) and another 10 are from the natural resources sector.
According to Peter McCartney of the Wilderness Committee, “Donations to the BC Liberals from fracking, gas pipeline and LNG companies have totalled $1,007,456 since the last election. … (These) include $338,041 from EnCana, one of the largest fracking players in BC’s northeast, and $114,540 from Chevron, which has a 50 per cent stake in Kitimat LNG. Other donations include $63,500 from Woodfibre LNG, who let Premier Christy Clark announce their final investment decision in November 2016.”
Gwyn Morgan, who guided Clark during her initial days as premier, was the founding CEO of EnCana and one of the architects of BC’s focus on LNG development. As regards the Kyoto Protocol, Morgan wrote it was “one of the most damaging international agreements ever signed by a Canadian prime minister.”
He was also Chair of the scandal plagued engineering firm SNC Lavalin from 2007 to 2013. According to Lavalin’s Management’s Discussion and Analysis document for 2012 (released the year Morgan retired),
“The Royal Canadian Mounted Police… is investigating the Company’s involvement in projects in Bangladesh and certain countries in Africa and this investigation has led to charges being laid against two former employees of a subsidiary of the Company under the Corruption of Foreign Public Officials Act (Canada) in regard to the Bangladesh project…”
Morgan retired from the Board after the World Bank imposed a 10-year corruption related ban on SNC Lavalin.
(The Ontario Supreme court dismissed the bribery charge this month, after ruling that the evidence obtained through a wiretap was not admissible.)
The company was also under investigation in Quebec, where the GLOBE AND MAIL subsequently reported,
“SNC-Lavalin has already admitted it made more than $1-million in illegal donations to Quebec political parties during the 2000s. Like other engineering firms in the province, managers and family members made personal donations to parties, which were then reimbursed with salary bonuses.”
None of this troubled Todd Stone, Clark’s Minister of Transportation and Infrastructure, who told the TYEE, “They have a stellar record, frankly, on projects that we’ve partnered with them on: the Canada Line, the Sea to Sky Highway, the W. R. Bennett Bridge in Kelowna.”
In 2014, Port Meto Vancouver hired SNC Lavalin to do the Environmental Impact Statement (EIS) for the Surrey Fraser Docks coal terminal proposal. The subsequent report concluded that the proposed terminal would “not likely cause significant adverse effects to the environment or human health.”
After studying this document, B.C.’s medical health officers Dr. Patricia Daly and Dr. Paul Van Buynder stated that SNC Lavalin’s EIS did not “deal with the full scope of the project” or “meet even the most basic requirements of a health impact assessment.”
Port Metro Vancouver’s response was such that one can only conclude they very much wanted this project to go forward. While SNC Lavelin was hired to prepare a “second” health assessment, the Port also took steps to ensure there would be no further interference from provincial medical officers . Tim Blair, Senior Planner of Port Metro Vancouver, told the ECOreport there is already sufficient information about the effects of coal dust in current literature. The new “report” would not be reviewed by any medical personal and the Port was not be seeking any additional opinions.
Burnaby Mayor Derek Corrigan had some cutting observations regarding the Port’s decision to hire SNC Lavalin, “If this company has been banned by the World Bank, why the heck are they doing environmental assessments in our back yard? This is completely losing control of any public interest in these projects what-so-ever.”
He added, “The Majority of Directors on Port Metro Vancouver are appointed by the very companies that stand to economically benefit from these decisions. And so here you have a Board of Directors, appointed by the companies that is in charge of the environmental assessment to determine if they are going to make more money.”
As expected, SNC Lavalin’s report was favourable and Port Metro Vancouver approved the Surrey Fraser Dock’s coal terminal proposal.
A drop in the world’s coal market intervened.
Gwyn Morgan was no longer Chair when SNC Lavalin prepared the EIS and health assessment for the Surrey Fraser Docks coal terminal proposal, but he was the Chairman when BC Hydro named SNC Lavalin as one of Site C’s two prime consultants in 2010.
This company is still one of the “prime consultants” for the Site C Dam project.
Ernst & Young
BC Hydro hired Ernst & Young (which donated $22, 450 to the BC Liberals in 2016) to carry out the project’s risk assessment.
According to Reuters, Ernst & Young was fined 2.1 billion yen ($17.4 million) in 2015 for failing to spot irregularities in Japan’s “worst accounting scandal in years.”
Though they “admitted no wrong doing,” Ernst & Young paid an $8-million penalty to the Ontario Securities Commission for their alleged negligence in auditing Sino-Forest, which failed in 2011, and of athletic shoe manufacturer Zungui Haixi Corp.
Ernst & Young is also listed on The Accounting Degree Reviews’ 10 Worst Corporate Accounting Scandals of All Time for their audit’s failure to uncover Lehman brothers portrayal of “over $50 billion in loans disguised as sales.” This led to the largest bankruptcy filing in US history and was partially responsible for the recession of 2008.
In their report for Site C, Ernst & Young state they “did not find any evidence to suggest that major project milestones and financial targets will not be met.” Their disclaimer adds that they “relied upon information provided by their client (BC Hydro)” and “have not audited, reviewed or otherwise attempted to verify the accuracy or completeness of such information.”
Fast Tracking Site C
Given the widespread local opposition to Site C, it is surprising to find that Clark’s administration is attempting to fast track this project.
4,000 hectares of the province’s prime agricultural land will be flooded if Site C goes forward. Given the province’s inability to grow enough food for its’ needs, this should have been a prime concern. Up until cabinet intervened, this land was under the stewardship of British Columbia’s supposedly independent Agricultural Land Commission (ALC). Premier Clark’s cabinet got around this by passing an order in council that allowed them to transfer those 4,000 hectares out of the Agricultural Land Reserve without going through the commission. They followed this up by firing ALC Chair Richard Bullock, who was too independently minded for their liking.
The Union of BC Municipalities responded by passing a resolution “that the Province of BC be requested to rescind Order in Council No. 148 until there has been adequate public input and respect shown for the legal requirements required to apply for removal of lands from the Agricultural Land Reserve.”
To avoid the possibility that the BC Utilities Commission might reject Site C for yet a third time, the provincial government did not submit the project for review.
The Joint Panel Review
This was one of the problems that the Joint Federal-Provincial Panel Review subsequently highlighted, “If it is decided that the Project should proceed, a first step should be the referral of Project costs and hence unit energy costs and revenue requirements to the BC Utilities Commission for detailed examination.”1
Their report also pointed to economic considerations that should be addressed, ” The scale of the Project means that, if built on BC Hydro’s timetable, substantial financial losses would accrue for several years, accentuating the intergenerational pay-now, benefit-later effect. Energy conservation and end-user efficiencies have not been pressed as hard as possible in BC Hydro’s analyses. There are alternative sources of power available at similar or somewhat higher costs, notably geothermal power. These sources, being individually smaller than Site C, would allow supply to better follow demand, obviating most of the early-year losses of Site C….” 2
The BC Utilities Commission’s Conclusion
The BC Utilities Commission conclusion from 1983 seems as applicable today as when it was first written:
“The Commission does not believe that an Energy Project Certificate for Site C should be issued at this time. The evidence does not demonstrate that construction must or should start immediately or that Site C is the only or best feasible source of supply ….”
“The Commission therefore concludes that an Energy Project Certificate for Site C should not be issued until (l) an acceptable forecast demonstrates that construction must begin immediately in order to avoid supply deficiencies and (2) a comparison of alternative feasible system plans demonstrates, from a social benefit-cost point of view, that Site C is the best project to meet the anticipated supply deficiency.”3
Top Photo Credit: Official opening of the Agriculture Centre of Excellence ACE as part of the University of the Fraser Valley’s 40th birthday celebrations in Chilliwack with BC Premier Kristy Clark in attendance. Rick Collins Photographer – UFV (CC BY SA, 2.0 License)