October 13, 2008

Vancouver Regional Construction Association

BC Hydro meets with VRCA members to present $5.3-billion expansion plan

BRIAN MARTIN

correspondent

BC Hydro is in the midst of a capital expansion program that will have a major impact on the construction industry in the province.

Over the next five years it will invest $5.3 billion to refurbish and expand its systems. That is three times more than the average for the last decade.

One of the challenges, however, is getting contractors to bid on its projects.

The industry has been so busy recently that sometimes the response to hydro tender calls has been disappointing.

On September 24, 2008 George Haddow, Hydro’s chief procurement officer and Tammie Citak, also of the procurement office, met with about 75 members of the Vancouver Regional Construction Association (VRCA) to outline the Crown corporation’s plans.

Although BC Hydro is not involved in the myriad of small and unconventional power generation systems being proposed for the province – such as run of river projects, solar power, wind power – it is still by far and away the largest producer of electricity.

It is responsible for the province’s heritage projects, which are large hydro dams and generation plants built many years ago.

Haddow outlined the issues and risks facing the corporation.

Declining equipment condition, increasing seismic standards and dam safety, increased capital spending, increasing First Nations and other stakeholder issues, and increased competition for skilled workers were some of the major issues.

On the risk side of the equation, it is facing rising commodity prices, contractors who are placing larger premiums to assume risk, the availability of skilled labour, construction and project management services and global competition to secure the specialized supplies they require.

“In short, Hydro needs your help,” Haddow told the VRCA.

Specific projects on the Hydro drawing board are:

• A concrete dam and powerhouse on the Stave River near Mission.

Plans are to rebuild the top portion of the dam and include new gate configurations.

The project will also include refurbishing the existing powerhouse and adding two or three new turbines.

Direct costs are estimated at more than $350 million and the job is tentatively slated to be done between 2010 and 2014.

• The Mica Dam 135 kilometres north of Revelstoke.

Plans are to install two new additional generators/turbines.

There will be concrete work in draft tubes and unit pits as well as considerable mechanical and electrical work.

The turbine/generator tender has been issued and Hydro is currently calling for expressions of interest.

The estimated cost is more than $300 million.

• John Hart project near Campbell River.

The project calls for seismic upgrades of the dam and complete replacement of the powerhouse, both of which went into operation in 1947.

A new powerhouse site is currently being determined and will soon be finalized. Total cost will be more than $500 million.

It is a possible candidate for a public/private partnership.

• Strathcona Dam, also near Campbell River.

BC Hydro plans seismic upgrades of the intake tower and spillway. Direct costs are listed at $121 million.

• Bridge River Plant not far from Lillooet. Plans are to replace two generators with an option to upgrade or replace the remaining six generators.

Project costs are still under consideration.

• GM Shrum power house at Hudson’s Hope north of Fort St John.

This is part of the giant WAC Bennett earth filled dam on the Peace River.

The project will include turbine rehabilitation on five turbines, capacity upgrades on three other turbines, transformer replacements, upgrades to station service, the control building, cranes and fire systems as well as dam safety projects.

Hydro estimates the cost at between $800 million and $1 billion.

• Spillway Gate Program. Hydro is planning to refurbish or replace existing spillway gates at 22 sites over three phases.

Phase One involving three sites has been completed and tenders recently closed for Phase Two involving seven sites.

Hydro estimates Phase Two will cost in the area of $300 million. Another phase is planned.

The largest Hydro project is still unconfirmed.

It is Site C on the Peace River downstream from the Bennett Dam.

Politically it is very controversial and has been debated for years, although it would be new construction, it is considered a heritage project and would fall under Hydro’s jurisdiction.

Haddow told the VRCA that plans for Site C were one of the early projects he worked on when he first began at BC Hydro, 30 years ago.

He said that while he is certain he won’t be around to see it finished, he sure would like to be around to get it started.

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