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Background and development of the 2024 Call for Power

In 2022, we identified a potential need to prepare for a significant competitive power procurement. This was in response to recent developments identified in our 2021 Integrated Resource Plan Signpost Update. Our Load Resource Balances indicated an increase in load and a decrease in supply from existing and committed resources, resulting in an earlier need for future resources – starting as early as Fall 2028.

When considering the design of the Call and our engagement approach, BC Hydro took into consideration the changes in our operating context over the past 15 years. These changes included the implementation of United Nations Declaration on the Rights of Indigenous Peoples, lessons learned from BC Hydro’s existing processes and Electricity Purchase Agreements, and information on market advancements in other jurisdictions.

Engagement on call design has been significant and valuable 

Engagement efforts have produced what BC Hydro believes is a balanced approach to the Request for Proposals and Specimen Electricity Purchase Agreement, which form the basis for the Call process, addressing our system and customer needs over the long term, economic reconciliation with First Nations, while also supporting commercial viability and (anticipated) competitive pricing from Independent Power Producers.

We issued a competitive Call for Power on April 3, 2024. We've completed our engagement process to gather input from First Nations, Independent Power Producers and stakeholders on our planned approach to acquire approximately 3,000 gigawatt-hours (GWh) per year.

Frequently asked questions during the engagement phase

These Frequently Asked Questions were meant to clarify concepts in previously posted draft Call documents and engagement materials. Should there be any differences between the responses in these FAQs and the Request for Proposals (RFP) or the Specimen Electricity Purchase Agreement (EPA) issued by BC Hydro when the Call for Power is launched, or subsequently updated, the RFP and the Specimen EPA shall prevail.

We are accepting pre-submission Competitive Electricity Acquisition Process (CEAP) Interconnection Requests beginning March 4, 2024 until April 19, 2024 at 5:00 p.m.

CEAP submission documents and information can be found on the CEAP 2024 Call for Power website and questions relating to the interconnection process can be emailed to CEAP2024@bchydro.com.

For several months, BC Hydro and the Canada Infrastructure Bank (the CIB) have been discussing the potential for CIB to support the Call for Power (the Call), and specifically to support First Nations looking to source capital to fund their equity ownership in winning bids.

The CIB has informed BC Hydro that it will support the Call by making a loan package available to all winning bidders. Draft credit documents will be available to all Proponents who register interest in the procurement at CFP-BCH-2024@cib-bic.ca. The CIB anticipates these documents to be available on the date that BC Hydro releases the Call Request for Proposal (RFP).

The minimum 25% First Nations equity ownership must be in place by the project's Commercial Operation Date (COD). At the time of proposal submission, the Proponent and First Nations Community must attest to the proportion of First Nation equity ownership in the project.

The requirements related to First Nations Equity Ownership are outlined in Section 3.0 and Attachment 7 of the draft RFP.

Changes to generation equipment may be permissible but consideration must be given to the provisions of both the EPA and the Open Access Transmission Tariff (OATT) to determine the feasibility of such change.

Under the terms of the EPA, any proposed change to the Seller's Plant, which would include generation equipment, requires, at a minimum, consent of BC Hydro. Depending on the particular proposed change, certain conditions may also need to be satisfied, which are set out in detail in section 4.8 of the Specimen EPA. As such, any proposed change in generation equipment must be communicated to BC Hydro for consideration under the EPA. To the extent acceptable, and provided that the relevant conditions are satisfied, then the Seller's Plant Description in Appendix B would be updated by the parties.

Even if consent is granted by BC Hydro under the EPA, a proposed change in generation equipment may trigger a process under the OATT. For example, equipment changes that result in an upward change to the injection amount at the Point of Interconnection – or POI – (to the BC Hydro system) will trigger a separate and distinct interconnection study process. Other changes may result in the need for additional studies under the Standard Generator Interconnection Process which could result in impacts to the overall project schedule and costs. Additionally, there may also be implications to the queue position that would need to be carefully considered prior to proceeding with such change.

Although this is an energy call, a capacity credit may be available in the evaluation for projects that can meet the definition of the Capacity Commitment as outlined in the EPA (summarized here below for readability):

The Seller will deliver and sell to the Buyer at the POI, Energy in at least the amount of the Designated Capacity Commitment in every On-Peak Hour between November 1 and February 28.

In our view, some technologies such as biomass or storage hydro may be able to meet the requirements for the Capacity Commitment under the EPA but it may be more challenging for intermittent resources, such as wind or solar, even when combined with battery to meet this requirement.

We note as well that liquidated damages will apply for under delivery of the Capacity Commitment as summarized below:

Calculation of Liquidated Damages: The equation shown in section 11.2 of the Draft Specimen EPA indicates that the Liquidated Damages (LDs) is $58,000 for each MW shortfall for the capacity commitment period. As a hypothetical example, for a 100 MW capacity project, with expected average annual energy of 300,000 MWh, and a 60 MW capacity commitment, LDs payable should the 33rd lowest hour of delivered MW of the November 1 to February 28 on peak hours were to be 20 MW, would be $2.32M (60 MW - 20 MW)*$58,000.

At this point we're not contemplating negotiated changes to the Specimen EPAs after the documents have been finalized and the Call for Power RFP has been issued.

Proponents will not be required to hold all permits for their project to be eligible for the Call when proposals are submitted. We plan to request that proponents submit a permitting plan at the time of proposal submission, including a list of anticipated required permits, a schedule to obtain permits and the status of permits at the time of proposal submission.

For projects located on provincial crown land, we will expect that the proponent has either applied for, holds, or has under review for replacement, of a Land Act Investigative Use Licence.

Interconnections

The 2024 Call for Power follows the Open Access Transmission Tariff (OATT) Competitive Electricity Acquisition Process (CEAP). In preparation for this process, we hosted two CEAP workshops.

Engagement summary

Call for power engagement infographic

Engagement documents

Phase two (complete)

In phase two, which took place from September 2023 to January 2024, we hosted workshops and conducted surveys on key elements of the call including First Nations Economic Participation Models, Draft Terms of the Electricity Purchase Agreement, and the Request for Proposals.

Session Dates Materials

Phase Two Engagement Summary Report

April 3, 2024

Phase Two Engagement Summary Report [PDF, 866 KB]

Additional information for developers and First Nations

January 17, 2024

Presentation: First Nations Information Session – corrected slide 10 [PDF, 204 KB]

Illustrative Evaluation Price Adjuster Formulas [PDF, 214 KB]

Draft Specimen Electricity Purchase Agreement and Request for Proposals for comment

January 8, 2024 to January 22, 2024

Draft Specimen EPA [PDF, 1.1 MB]

Draft Request for Proposals [PDF, 1.9 MB]

Feedback Form [DOCX, 33 KB]

Consideration Memo of Feedback Key Themes to Date [PDF, 160 KB]

System Information and Pre-CEAP Information Requests

December 7, 2023 to January 12, 2024

BC Hydro Transmission System Information [PDF, 368 KB]

Pre-CEAP Information Request [DOCX, 44 KB]

November Engagement Package B

November 28, 2023
First Nations only, virtual session

November 29, 2023
First Nations and IPP, in-person session

November 30, 2023
First Nations and IPP, virtual session

Engagement guide: Call for Power Engagement Package B - First Nations Participation Model, EPA Term Sheet and RFP Summary [PDF, 1.1 MB]

Presentation: Planning for a Call for Power [PDF, 2.0 MB]

October Engagement Workshops to seek input on draft key terms

 

October 19, 2023
First Nations only, virtual session

October 17, 2023
First Nations and IPP, virtual session

October 12, 2023
First Nations and IPP, in-person session

Engagement guide: Call for Power Engagement Package A - Call Elements and Draft Terms for Feedback [PDF, 330 KB]

Presentation: Planning for a Call for Power [PDF, 487 KB]

Engagement Summary Report on September Focus Group Sessions
October 5, 2023 Summary Report on September First Nations Sessions [PDF, 541 KB]


Phase one (complete)

In phase one, which took place from June to August 2023, we hosted engagement sessions to provide information on the upcoming call for power and solicit into key elements of the call.

Session Dates Materials
Phase One Engagement Summary Report September 19, 2023 Phase One Engagement Summary Report [PDF, 2.7 MB]
First Nations Energy and Mining Council Submission August 2023 A Framework for Advancing Indigenous Economic Opportunities [PDF, 684 KB]
First Nations Only Focus Groups August 2023 Presentation [PDF, 437 KB]
First Nations and Industry Focus Groups July to August 2023 Presentation [PDF, 429 KB]
First Nations and Industry Information Session June 29 and July 6, 2023 Presentation [PDF, 854 KB]
Local Government Information Session June 28 and July 11, 2023 Presentation [PDF, 522 KB]