The BC CONSTRUCTION MONITOR is an ICBA publication providing ahead-of-the-curve information and statistics on the BC construction industry and issues relevant to it.

The Monitor draws on analyses and outlooks from various sources, and provides current and substantive insight. This regular publication is intended for industry executives, government decision makers, journalists and other opinion leaders.

Clean, reliable, and abundant – a real legacy

CON T E N T S :

Environmentally responsible investment in B.C.’s future... Inside

Securing low energy prices... Back page

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What value would Site C bring to people and businesses if it is built? The Peace River dam option would result in lower costs for ratepayers than other clean energy options for the same amount of energy and capacity.

Both the alternative portfolios would have higher costs than Site C over the lifetime of the projects. This would be consistent for all ratepayers – residential, commercial and industrial.

THE BC

In a competitive global economy, Site C dam offers decades of benefit

CONSTRUCTION MONITOR

Cheap and reliable elec-tricity is a cornerstone of British Columbia’s economy. Today, B.C. has a chance to renew and extend the legacy that W.A.C. Bennett began in the 1960s when his government built massive dams and generat-ing stations on the Peace and Columbia Rivers.

The Site C Clean Energy Project on the Peace would create a major new source of power, at a time when BC Hydro expects demand for power to leap with population growth and the development of a new liquefied natural gas export industry.

The $7.9 billion Site C project does more than drive our exports. It creates prosperity

for thousands of B.C. businesses and tens of thousands of workers. Construction of the dam and its generating station brings 10,000 person-years of direct employment, and a total of 33,000 person years of work throughout the economy.

Ultimately, everybody in B.C. has a stake. Site C construction contributes $3.2 billion to provincial GDP, $130 million to regional GDP, and $40 million in tax revenues to local government.

Once in operation, the positive effects continue. Renewable, clean and green power is a key asset in an increasingly competitive global economy, and Site C is a cost-effective option for maintaining that advantage.

The election in 2013 was won on the notion of economic development and job creation. Voting in the government is an important first step, but we all have a responsibility to ensure that the project succeeds, and that our voices get heard.

Winter 2013/14

Philip Hochstein

Independent Contractors and Businesses Association of British Columbia

Adjusted Unit Energy Cost Comparison:

Unit energy cost (UEC ) values include transmission-related costs to the Lower Mainland, wind integration costs, soft costs, and costs of capacity backup, and exclude sunk costs. The UEC for Site C at the point of interconnection to the BC Hydro system is $83/MWh. Based on $/MWh in F2013.

Site C Project

Mixed sources Alternative sources

$94 $128 $153

SITE C MEANS ENVIRONMENTALLY RESPONSIBLE INVESTMENT IN B.C.’S FUTURE

“The Site C project is a building block for our province, and represents an environmentally responsible and sustainable source of electricity that can power our economy for generations. That is why our organization supports it moving ahead.” – Philip Hochstein, President, ICBA

Sour

ce: b

chyd

ro.c

om

50

0

100

150

200

R E S E RVO I R F O OT P R I N T S

W.A.C. Bennett’s Williston

177,300

Site C

9,330

Peace Canyon’s Dinosaur

890

BC Credit Rating: AAA

Hec

tare

s (t

hous

ands

)

Increased revenuesGetting down to work...

More electricity with a small footprint on the land Where Site C spending will go

KEY TRADESCarpenters

Cement masonsElectricalEnvironmental monitorsIronworkersLabourersMachinistsOperating engineersPaintersPipefittersSafetyWelders

84%$3.2 billion

450,000 100+of British Columbians support Site C or can accept it under circumstances

Boost to the provincial GDP from economic development during the Site C construction period:

Number of homes Site C will power Years of life producing inex-pen sive electricity if maintained

A key advantage of the Site C project is its location on the Peace River downstream of the existing W.A.C. Bennett and Peace Canyon dams and their respective Williston and Dinosaur reservoirs. This means Site C will be able to re-use the same water flowing downstream from the two upstream facilities and simply pass it along.

Construction of the project will create approximately 10,000 direct construction jobs, and approximately 33,000 total jobs through all stages of development and construction.

The project estimates that approximately 15% of workers will live in local communities. The remainder would live in camps (on site and off-site).

Approximately 10,000 person-years of work will be required to complete construction of the project, with the labour force peaking at approximately 1,700 in year five of construction.

The construction and operation of Site C would provide additional revenues to all levels government, helping to pay for key programs and services.

Large hydro projects, such as Site C, have a significant upfront capital cost, followed by low operating costs and a long life of more than 100 years.

Site C has an estimated capital cost of $7.9 billion, which includes construction and development costs, inflation, contingencies and interest during construction. An external peer review by KPMG determined that both the process for developing the assumptions and the construction of the financial model used in the Site C cost estimate are appropriate.Vancouver

Fort St. John

Direct

Indirect & Induced

Development Construction

Construction Camps Local Housing

0 5,000 10,000 15,000 20,000 25,000

THE CHALLENGE:

Provide for a

40% rise in energy needs

www.icba.ca

Offsite works: $530 M

Worker housing, management: $515 M

TOTAL: $3,825 M

Dam, structures: $1,790 M

Power facilities: $990 M

$446 million Activities during construction would result in approximately $176 million in provincial revenues, and approximately $270 million for the federal government.

$220 million The return on equity that would be provided to the provincial government in the first year of operation.

$40 million Total tax revenues to local governments during construction.

Salaries for 1,049 surgeons

2,700 senior teacher salaries

647 junior nurses’ salaries

=

=

=

Source: BC Hydro

W.A.C. Bennett Dam

Dinosaur Reservoir

Potential Site C Dam

Potential Site C Reservoir

Peace Canyon Dam

Hudson’s Hope

Peace Rive

r

Fort St. John

Taylor

TOTAL DIRECT CONSTRUCTION COSTS

Securing low energy prices into the future

Winter 2013/14

Independent Contractors and Businesses Association of BC 211 – 3823 Henning Drive, Burnaby, BC V5C 6P3

Phone: 604.298.7795 Toll-free: 1.800.663.2865 Website: www.icba.ca Email: info@icba.ca

Member of

Hydro investments place B.C. prices among the lowest

A source of clean and renewable electricity

0 50 100 150 200 250 300 350

Winnipeg, MBSt. John's, NL

Montreal, QCChicago, IL

Vancouver, BCSeattle, WA

Portland, ORMiami, FL

Regina, SKOttawa, ONHouston, TXMoncton, NBNashville, TN

Detroit, MICharlottetown, PESan Francisco, CA

Halifax, NSToronto, ONBoston, MA

New York, NYEdmonton, AB

Calgary, AB

Source: Hydro Quebec

Source: BC HydroSource: www.ippsa.com

0

Modern Coal

Diesel

Natural Gas

Solar

Wind Turbines

Site C

200 400 600 800 1000 1200

Site C would produce among the lowest levels of greenhouse gas emissions compared to other electricity-generation options.

Residential customers in B.C. are behind only Manitoba in having low electricity rates.

British Columbia’s legacy hydro generation assets in many cases date back half a century, yet continue to give industry, and individual users, an advantage over most North America service areas. The bar chart shows where B.C.’s large-power consumers stood in 2013 in relation to a range of other jurisdictions. By building Site C, the province will be able to maintain competitive electricity rates in the future.

Comparison of Canadian electricity rates

Cost

LOWEST HIGHEST

Relative prices for industrial customers

Average GHG emissions intensity (gCO2e/kWh)