Change to BC energy policy could pave way for Blue Fuel/DME exports

WWW.BLUEFUELENERGY.COM: As reported in the Vancouver Sun and other media on Monday, November 2, British Columbia Premier Gordon Campbell has outlined a major change in BC’s energy policy which should have major and positive implications for all alternative energy suppliers in the province. According to their press release, the provincial government intends to create four green power task forces which “will consist of clean-energy experts, energy consultants, renowned climate experts, leading academics, First Nation representatives and environmentalists.” The stated goal of the task forces is to make “BC an international leader in green power development – both for the province and for export…”

These task forces fall under the overall responsibility of the Green Energy Advisory Task Force which was highlighted in the August BC Throne Speech and which was written about in this blog on August 28, 2009.The four task forces are to be organized in the following way:

• Green Energy Advisory Task Force on Procurement and Regulatory Reform. This task force will recommend improvements to BC Hydro's procurement and regulatory regimes to enhance clarity, certainty and competitiveness in promoting clean and cost-effective power generation; and identify possible improvements to future clean power calls and procurement processes.

• Green Energy Advisory Task Force on Carbon Pricing, Trading and Export Market Development. This task force will develop recommendations to advance British Columbia's interests in any future national or international cap and trade system, and to maximize the value of B.C.'s green-energy attributes in all power generated and distributed within and beyond B.C. borders. The task force will also develop recommendations on carbon-pricing policies and how to integrate these policies with any cap and trade system developed for B.C.

• Green Energy Advisory Task Force on Community Engagement and First Nations Partnerships. This task force will develop recommendations to ensure that first nations and communities see clear benefits from the development of clean and renewable electricity and have a clear opportunity for input in project development in their areas. It will work in partnership with first nations, not only to respect their constitutional right, but to open up new opportunities for job creation and reflect the best practices in environmental protection.

• Green Energy Advisory Task Force on Resource Development. This task force will identify impediments to and best practices for planning and permitting new clean, renewable-electricity generation to ensure that development happens in an environmentally sustainable way. The task force will also consider allocation of forest fibre to support energy development and invite input from solar, tidal, wave and other clean energy sectors to develop strategies to enhance their competitiveness.

Of particular note to companies interested in Blue Fuel/DME in general and export in particular are the task force on Carbon Pricing, Trading, and Export Market Development and the one on Resource Development. Let’s look at these two task forces separately.

The Green Energy Advisory Task Force on Carbon Pricing, Trading and Export Market Development shows promise in two areas. First, this task force states that it intends to develop recommendations relating to any future national or international cap and trade system. Clearly, the world is moving increasingly towards such a system (or a network of systems) and, as such, clean fuels have a central role to play not only on their own carbon-neutral merits but also because they offer value to companies and/or countries in need of carbon credits. It is by no means a stretch to imagine the day when clean DME/Blue Fuel producers are not only exporting their fuel but also their credits. The second way in which this task force may benefit clean energy producers in BC and their overseas off-takers is its focus on export development. Although it is unclear at this time how the task force intends to promote clean energy export, any energy-export-minded government organization is a welcome ally.

Now let’s look at The Green Energy Advisory Task Force on Resource Development. One of this task force’s stated goals is to develop strategies to enhance the competitiveness of clean energy sectors. This could mean a more efficient regulatory system which could make export easier either in terms of speed or cost. Moreover, this task force is also “considering the allocation of forest fibre to support energy development”, which immediately brings to mind the BioDME Project and their efforts to create carbon-neutral DME from biomass.

The long story is, of course, that these initiatives are in their very earliest stages in an ever-changing energy environment. The short story is that these initiatives are good news. Very good news indeed.

BC Government forges ahead with clean energy plan

BLUEFUELENERGY.COM: The summer of 2009 has certainly been a tumultuous one for the renewable energy industry here in British Columbia. On July 26 the British Columbia Utilities Commission (BCUC)—an independent regulatory agency of the provincial government—shocked the industry and the government by rejecting the 2008 Long Term Acquisition Plan (LTAP) of BC Hydro, a BC crown corporation, saying that it was not in the public interest and ordering BC Hydro to deliver a new LTAP by June 30, 2010. That myopic decision completely ignored the BC Government’s 2007 Energy Plan and various other progressive policies. It also dropped a wet blanket on billions of dollars in investment in green power generation. Appalled by this cheeky pulling of the plug on its initiatives, the government boldly stated its resolve to pick the plug up off the floor and jam it back in the socket.

A mere month after the BCUC decision debacle, the BC Government appears ready to deliver; in its August 25 throne speech (outlining the agenda for the upcoming session of the legislature) the government clearly states what it plans to do to ensure that BC is a leader in renewable energy and climate change mitigation. Sections of the speech most germane to the renewable energy industry are as follows:

• “Green energy will be a cornerstone of British Columbia's climate action plan.”
• “Electricity self-sufficiency and clean, renewable power generation will be integral to our effort to fight global warming.
• “The BC Utilities Commission will receive specific direction.”
• “Phasing out Burrard Thermal is a critical component of B.C.'s greenhouse gas reduction strategy.” (Burrard Thermal is an archaic natural gas power generation facility that BCUC proposed ramping up.)
• “Further, this government will capitalize on the world's desire and need for clean energy, for the benefit of all British Columbians.” (Clean power exports . . . )
• “Whether it is the development of Site C, run-of-river hydro power, wind, tidal, solar, geothermal, or bioenergy and biomass — British Columbia will take every step necessary to become a clean energy powerhouse, as indicated in the BC Energy Plan.”
• “We will build on past successes with new strategies aimed at developing new clean, renewable power as a competitive advantage to stimulate new investment, industry and employment.”
• “New energy producers will be looking for long-term investments leveraged through long-term power contracts that give them a competitive edge in our province.”
• “We will open up that power potential with new vigour, new prescribed clean power calls and new investments in transmission.”
• “A new Green Energy Advisory Task Force will shortly be appointed to complement the work of the BCUC's long-term transmission requirement review. That task force will be asked to recommend a blueprint for maximizing British Columbia's clean power potential, including a principled, economically-viable and environmentally-sustainable export development policy.”
• “It will review the policies, incentives and impediments currently affecting B.C.'s green power potential, and it will identify best practices employed in other leading jurisdictions.”
• “Low-carbon gas development is the key to maximizing B.C.'s energy potential where it can occur with minimal environmental impact.”

Although the government does not specifically mention carbon-neutral Blue Fuel/DME in this speech from the throne, it does support its production by:

1) Vigorously promoting expansion of renewable electricity generation above and beyond large-scale hydro, which is currently the basis for Blue Fuel/DME production in the province;
2) Recognizing that gas is a key to maximizing the province’s energy potential, but that this gas must be low-carbon (for example, natural gas in which the CO2 is “actively sequestered” or recycled, as it would be to produce Blue Fuel/DME.

We at Blue Fuel Energy look forward to learning more about the “specific direction” that the BC Government will shortly be providing BCUC.

BC Government sets 2007 GHG emission baseline

BLUEFUELENERGY.COM: On July 30 BC Environment Minister Barry Penner and Minister of State for Climate Action John Yap reaffirmed the BC Government’s commitment to reducing carbon emissions by releasing the British Columbia Greenhouse Gas Inventory Report 2007. According to the report, in 2007, BC emitted 67.3 million tonnes of greenhouse gas emissions measured in carbon dioxide equivalent (CO2e). Trends in GHG emissions in BC show a 21% increase from 1990, a 7.6% increase since 1997, and a 3.8% increase since 2006.

2007 was established under the provincial Greenhouse Gas Reductions Target Act as the base year for calculation of GHG emissions targets. The Act puts into law BC’s target of reducing GHGs by at least 33% below 2007 levels by 2020 and includes the long-term target of an 80% reduction below 2007 levels by 2050.

Complying with the Act it created is a daunting task for the BC Government. On a page of its LiveSmart BC website discussing BC’s greenhouse gas emissions, the government recognizes that the two primary drivers for the growth in GHG emissions since 1990 are population growth and expansion of the natural gas industry. Although the industry did boom from 1990 to 2007, it is now poised for a gas boom to end all gas booms as a result of natural gas discoveries in the Horn River Basin in northeastern BC. Indications are that the Horn River discovery is the largest discovery of natural gas in Canadian history.

Given the demise of the forest industry in BC and other economic shortcomings that have resulted in substantial revenue shortfalls for the government, the prospect of exploiting the natural gas resources of the Horn River Basin is enticing. Too enticing for the government to ignore. That said, the processing of natural gas generates huge volumes of carbon dioxide. Too much carbon for the government to ignore. A dilemma indeed.

Fortunately, there is a solution—producing Blue Fuel/DME using wind energy—which is also abundant in northeastern BC—and waste carbon dioxide from natural gas processing. Energy synergy at its finest. The BC Government has been apprised of this opportunity to make BC a wind energy powerhouse, a natural gas powerhouse—and a Blue Fuel/DME powerhouse. It will be fascinating to see how the government responds. Stay tuned to this blog for more.