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PEACE RIVER SITE C PROJECT:ENVIRONMENTAL STUDIES;DEVELOPMENT OF A MITIGATION ANDCOMPENSATION PROGRAM; AND PROJECTLICENCINGJohn Waite & Harold GruberPublished online: 23 Jan 2013.

To cite this article: John Waite & Harold Gruber (1981) PEACE RIVER SITE C PROJECT:ENVIRONMENTAL STUDIES; DEVELOPMENT OF A MITIGATION AND COMPENSATION PROGRAM; ANDPROJECT LICENCING , Canadian Water Resources Journal / Revue canadienne des ressourceshydriques, 6:3, 20-37, DOI: 10.4296/cwrj0603020

To link to this article: http://dx.doi.org/10.4296/cwrj0603020

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PEACE RIVER SITE C PROJECT:

ENVIRONMENTAL STUDIES; DEVELOPMENT OF A MITIGATION

AND COMPBNSATION PROGRAM; AND PROJECT LICENCING1

John Waite and Harol-d Gruber2

ABSTRACI: The ptoposed Peace Riuet Site C Pt'oieeto in north-eastern Bz,itish co-Ltonbia has a number of possible enqinorrnentaLqnd socio-eeonotm:c impacts of potentiaL signifi'eanee.

-Theptouinee of Br:ittsh CoLtmbia r.eqtiTes benefit -eost anqLA-ses fonmaior n uogy pz'oieets, and priniipLes fo,r nijigation qnd eom-

pehsation lbi proiect'impaets hqs- been deu,eLoped on this basis.n n^ Energy Proib& ReuTa,t Pt'oeess pnouides for eooz'dinnted!,euian of enui,z,onmentaL and teehnteal aspeets .of energy pt'o'jeets, uTth Pno.n Site C erpeeted to be the first mqjor proieetsubiect to pubLLe heaz'irrys undev' thLs pt'ocess,

RESIIME: Le pz'oiet pz,opos6 pouz'Le site C de La riuiDz'e de La

Pair q1,L nord-est de La Colombie-Bz"Ltannique euige que L'oneffeetue des artaLyses cofrt-qDantages pour Les gz'artds pnoiets6nez,g6tiques, et Lton a 6labor'6 stu eette basg des prLneipesuisaht d.-Ltatt6ru,&tion et d, La eornpensation de Ltirnpaet de eesproiets. On a /tqbLi une nouueLle pt'oc1dute d'6ualuation desproiets 1nez'gdtiques en r1'Le de La z'6uision cootdonnde dee asp-ectsteehniques et AcoLogiques des urt2nagements destinds d La pno.duc'tion di1nergie, et Le site de La Paiu C sez'a Le premiez'projetdtirnpoz,tan.b pouz' LequeL se tiendront des qt&Lenees pubLiquesen uev,tu de cette procddt'ue.

IMRODUCTION

The proposed Peace RLver Slte C ProJect wouLd be a 50 m

high eartirttlt dam with an installed capacity of 900 MI^l located7 km southwest of the city of Fort St. John ln northeastern B.c.If approved for constructionr it w111 be the third dam on thePeace River. upstream are the huge I/J.A.c. Bennet Daur, providlngthe maJor storage on the rlver, wlth an lnsta11ed capaclty of

Canadian Wat.er Resources Journal

Vo1. 6o No. 3' 1981

rpresented at the Conference on Envlronmentall-y CompatibleIlydro Development' Ottawar May, 1981.

)'B.C. Hydro and Power Authority.

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21700 MI^], and the Peace Canyon Dam, a run-of-.the-rLver proiectwith an lnsta11ed capacity of 700 MW.

ENVIRONMENTAL STIJDIES

Detailed environmental studies commenced in r976 and werecompleted in L979 with the exception of archaeological studieswhich are ongoing. Before these studies were begun, detailedterms of reference were submitted to the provincial Enviroilnentand Land use committee for comments and approval from the variousprovincial agencies. cornprehensive environmental studies wereconducted by a consortium of independent consultants w1th themain lssues being loss of potential agricultural 1-and, reloca-tion of va11ey residents, and impacts on teneral recreati_on,heritage resources, fishn wildlife, forestry and the surroundlngcommunities, particularly Fort St. John.

The draft consultant reports were submitted to the pro_vincial agencies for review before being finalized. This reviewresulted in the commissioning of a specifi.c study on the pocen-tial for a fresh vegetable and processing industiy in the ?eaceVa11ey. fn totaL, 14 reports were prepared on v"iiorrs aspecEsof the envlronment. These reports have been dj.stributed togovernrnent agencies, libraries, colleges and universities andinterest groups throughout 8.C., and to numerous 1oca1 govern_ments, groups and individuals in the project area.

Agriculture

The major environmental concern on this project is theflooding of existing and potential_ agricultural iand. Ourstudies examined what the impacts would be on the land base asit presently exists, and also what they would be if the land base\'rere developed to increase agricultural production to meet futuredemands at a local and regional scale for fresh vegetable pro_duction and for a vegetable processing industry.

_ In order to gain a perspectlve regarding the impact onagri-culture it is necessary to examine the agricultu;al landbase which exists in the peace River var-l.y Iorp*r.d to that inthe Peace River-Liard region (an area in northeast B.C. com_prising about 1/10 of the provi.nce), and. in the province as awhol-e. Most lnportant in the B.C. context are the areas withinthe provlncial Agricultural Land Reserve (ALR) crassification(uapability classes 1 - 4 in the canada Land rnventory ofagricul.tural land):

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Provincial total

Peace River-Liard reglon

Site C project

11,660r 000 acres

3,700,000 acres

6,500 acres

The project would remove 727. of ilne 52,500 acres within the

ALR in the lower Peace Rlver va1ley between the existing Peace

Canyon dam and the Alberta border'

The hlgh quality of the valleyrs a11uvia1 soil and the

warmer microcllmat. tf tn" valley terraces make this land suit-able for vegetable production and there was a maJor concern thatthis proJecl would irecl-ude the development of,a fresh vegetablemarket and processing lndustry' A specJ'a1 study was conducted

to examine the potenilal for a vegetable industry supplyingnorthern B.C., the Yukon and northeast Alberta'

The effect of thevegetable production ls

project on the available land base for-

shown Ln the following table:

Potential Veeetable LandIn the Peace River Valley

TotalRequired for Processlng PlantRequired for Fresh Vegetable

Remainder (unutilized)

wirhout site c l,Jltb slte-c(acres) (acres/

22,L7 45,500

Market L,424

L5,25O

16 ?5445 ,5001 It2L

9,620

The conclusion of the study was that development of the

Site C project would not preclude the development of a vegetablep.o""""i.g plant in addition to a fresh vegetable- industry to

serve northern marketsl however, the economlc viabil-ity of a

processing plant in this area is seriously in question when

cornpared Io-plants in B.C.ts lower mainland'

Rural Impacts

Residences of 35 farnil-ies and outbuildlngs of another 4

farnilies would be flooded by the Project' Six mobile homes

would have to be moved to higher ground and an additional l-7

families would have thelr property affected by hlghway relocation'Tour famllies trave already moved Lt""tt"t of Site C' 0f a sample

of 25 famllies studied oniy 5 would want to move; the other 20

are reported as being very uPset about a posstble move' Beeause

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gf the uncertainty about the project since the inceptlon ofdetailed studies, farnilies lrving in the area that would beflooded have already experienced a good deal of stress. Hydrohas attempted to mitigate these effects by a passive landacquisition program. This program a11ows owners who wish tose11 to do so, with lease back and repurchase provis.ions.

Recreation

. The main impact on recreation would be the change fromriver-based activity to reservoir-based actlvlty. piesenr useof the river includes fishing, boating, slghtseling, camping andpicniking, with fishing accounting for about one=ihira of

"11recreational use.

The limited amount of developed access and campi.ng facil_ities appears to be the rnain deteirent to more Lntensive use ofthe river. Local service clubs helped to develop a sfiralr- river-side park in the town of Hudsonts l1ope, A group of boaters hasdeveloped a few caurping sites on islandsn "rra tir.

parks Branchhas provided a boat launching rarnp. River boating, camping andfishlng are offered by private businesses, Neither the parksBranch nor Forest Service has developed any rnaJor facllities.

With the project there would be both recreational lossesand benefj.ts. As the reservoir would be cornpletely clearedprlor to flooding and the water 1evel fluctuations would beminor, the reservoir, as compared to the river, 1s expected toattract similar numbers of people from the surroundin!

"ru."but the relative importance of the different recreatiJnalactlvities would changen General boating, fishing and campingwould be more popu1a1. More people .." iik.ly to use thereservoir for canoeing because travel on the rl.ver would nolonger be one way.

, rncreased public access to the water would be a significantbenefit. There would be at least four areas on the north shoreof the reservoir suitabLe for campground., pj-cnlc, boat launch_ing or day use facilities

For a relatively minor investment in these campground andday use facilities for tourists and 1oca1 residents, it isexpected that there would be a greater recreational use ofthe area with the project than without. since the slte c dam-slte would be wlthin easy driving distance of Fort st. John and

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the Alaska Highway, it is expected to be a major tourist atEtac-tion.

Wildlife

The Peace River regi-on provides over 20 percent of the

moose harvest in srittsh Columbia' Of the 4,000 to 8'000 moose

in the region, up to 110 are estimated to frequent the projectarea at any given time during the winter, and up to 500 in thecourse of the year. There ii a single herd of e1k along one ofthe tributary streams, which uses the slopes above the proposed

reservoir. Deer are widespread on the floodplain ln summer'

Thereisalsoanabundanceofsmallermammalsandbirds,includ-ing: beaver, weaslesr martinr fisher and mink; ducks' Canada

g.!"., sandpipers, kiildeers, ruffed grouse' varlous nestlngraptors, and songbirds.

The impact on wi1d1lfe would result from flooding of thereservoir area and in loss of wildlife trabitat' The nost sig-nificant regional impactsl would be the loss of L25 - 250 moose'

up to 250 mule deer, and 1,000 - 3,000 ruffed grouse' There

would also be some losses of most of the other sPecies men-

tioned above. When the significance of wildlife impacts isvier^red in 1oca1, regional ind provincial context' losses would

be largely lnsignificant at the provincial level' low at theregionil ieve1, and moderate-to-hlgh at the local 1eve1'

Fisheries

At present, mountain whitefish appear to be tbe most abun-

dant spoit flsh ln the project area' Other sport fish in de-

creasing order of abundancl are Arctie grayling, rainbow trout'Do11y Varden, northern pike and ye11ow walleye'

The creation of a reservoir would greatly lncrease theamount of habitat available to aquatie organisms and fish' The

long-term producti-on of phyLoplankton and zooplankton would in-crease after lmpoundrnent, and fish species adapted to reservolrconditions would make use of these food organisms '

Northern pike populations would be expected to increase inthe reservoir, mouniain whitefish and Arctic grayling numbers

would remain high or l-ncrease slightly, and Do11y Varden rurmbers

roight also increase slightly providing they can withstand anglingpt!"",rt". Rainliow t.orrl popnlations would be reduced because ofth. .ruty lirnlted spawning habitat which would remain' However'

lf recruitment of yo.ttg lto,,t from uPstream reservoirs should

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prove to be significant, the ralnbow trout population could beincreased accordingly.

Heritage Resources

To date, 310 heritage sltes have been recorded in the Sitec study area. Artifacts and materlal rangi-ng from common flakesof chert to the remai-ns of historic structures have been found.

The remains of the Rocky Mountain Fort, bui_1t a year afterexplorer Alexander Mackenzle passed through the lor^rer peaceRiver va1ley on hls r.,7ay to the pacific Ocean, is found at themouth of one of the tributary streams as are two later furtrading posts. Across the river from Hudsonrs Hope are theremalns of a 1og cabin, an ol-d ferry landing and i.ocky MountalnPortage House, built by Simon Frasei. Aboui g0 percent of allsites contaln flakes of chert, and 40 percent

"orrt"i' oth",cultural items some of which were of diagnostic value. A smal1scale excavati.on conducted at one of the larger aboriginalsites yielded nearly 6r000 stone arti.fact", ih. fult Jf whichwere chips of black chert.

Seventy percent of the known heritage sites have been dis_turbed to various degrees in the past. ih. slt" c project wouldresult in the submergence or 10ss of many of the known heritagesltes, lncluding Roeky Mountain Fort. possibly the foreshorearea of Rocky Mountai-n ?ortage House site would be affeetert h.,the reservoir.

Forestry

There has been no significant logging in the reservoir areato date. Access to merchantable tirnber is severely limited bysteep banks, river channels, and lack of prlmary """."" to thesouth bank of the peace River. 0f the proposed reservolr area,less than one fifth 1s stocked with merchantable timber and muchof this is scattered in sma11_ patches posing access problems.

The project would result in the loss of less than 1 percentof the allowabLe anuual cut in the adjacent forest manaqementareas. The reservoir area would be cornpletely cleared frior toflooding, and where practicable merchantable tlrnbet ,ro,rid be re-moved and sold durLng the clearing operation.D

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Impacts on Fort St. John and Environs

The estirnated total peak construction workforce for the

project by year is shown telot along wlth estinates of where

lh.-totk.is would originate and where they would live'

Construction llorlc Forse-Estinatme{}te

7982 1983 Lg84 1985 1986 1987 1988

Workers From Region 300

In*Migrant Residentsto Fort St. John 60

Camp Residents

'ro Eaa

480 745 815 835 r55 100

r40 230 230 205 115 70

140 410 930 995 665 205 115

500 1030 190s 2o4o 1705 475 28s

Most of the in-rnigrant workforce would be housed in con-

struction camPs. Howeier' an estinated 230 workers with 520

dependents rolld move to ih. pott St. John area during the peak

year of constructj-on. The peak population j-ncrease during con-

struction would be about rgbo in-r-ggs. This would be the equiv-

alent of just under 7Z of the forecast population of the Fort

St. John/Taylor region in 1985 without the project'

During the construction phase wages and salaries of theproject labour force are estimated to total $188 rnillion'ippio*i*.tely $83 million would accrue to residents of the region.Atout 1,000 temporary jobs, both directly and indirectly rela-ted to the project would be created for regional residents inthe peak year of constructlon (835 on the project, 140 in thelocal service sector). An estimated $110 million would be

injected into the 1oca1 economy during the constructj-on period'

The population of Fort St. John has increased rapidly inrecent yuit": frorn 8 1947 to L976 to L4r82O in L979' The com-

munity is already experlenclng the stress and disruption ofrapid growth and a lirge transient populatlon' The Site C pro-ject can be expected to add to some of the existJ'ng problems

but not introduce new ones. our studies indicate that rnajorsoclal probl-ems in Fort St. John are alcohol- abusen trafficaccidents, a high crime raten a migrant school population with

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a high dropout rate, and underfinanced transients seeking work'

In spite of the recent rapid expansionn studies indicate thatthe local soci-al service =y"tu*is working well' B'C' Hydro

will assist in providing pianning and other assistance r'rhere

,r."u"""ty to reiieve an! strains irnposed on this system by the

Site C project,

If economic condi-tions remain buoyant in the region the

Site C project would have little impact on the local housing

market in Fort St. John. The recent boom in constructiontwhich saw an average of over 680 units added per year is unlikelyto continue at thal pace. Demand associated with Site C nay

ease a decline i-n construction' If conditions stabllize com-

p1etely, the downturn following the project may cause a temporary

over-supply l,rt tt.-"xpectatio; is that the houses released

by construction personnel would be taken up by the market in an

orderly way. Fort St. John, Taylor and Hudsonts Hope all have

an adequate supply of serviced iand to meet any increased growth

associated wLth Site C.

DEVELoPMENToT'PRINCIPLESFoRMITIGATIoNANDCoMPENSATIoNAND THEIR APPLICATION TO THE SITE C PROJECT

Before presenting B.C' Hydrors specific suggestlons fordealing with the impafts of Site C we will turn to a discussionof the principles and guidelines-by which proposals for niti-gaLion and compensation are devel-oped'

l^lith the appeal by the B.C' Fish and Wi1d1lfe Branch of the

Seven Mile project ltclnse in 1975 a debate began in BritishColumbia over the extent to whlch environmental imPacts should

be rnitigated or, if unmitigabler the amount of compensation

for loss or damage that should be paid and to whom the Paynents

shouldbemade.Theissueswerenotnewinthatmajordevelopers'including B.C. Hydro, had made design changes in the Past toavoj-d or lessen itpa.ts, and payments have been made for compen-

sation measures. i'ltt"t the Seven Mile appeal and subsequent

award signalled was a change in both the scope and comprehensive=

ness of the issues.

This change occurred at a time when the goverilDent was inthe process of developing Beneflt/Cost Guldelines for proJect

evaluation. A rePort on the impact of the Seven Mile dam upon

which the Comptroiler of Water Rights I rnitigation award was

based, fol-lowed in a general fashion the prlnciples outlined inthe Benefit/Cost Guidellnes. The Revelsttke ?roJect Beneflt/Cost

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Analysi-s, including the resource evaluation work, upon whi-ch someof the compensation and mitigation di.scussions centred I was pr€-pared followi.ng the Guidelines,

Since that time considerable work has been carried out byboth B.C. Hydro and the Provincial Government to develop prj-n-ciples for mitigatj-on and compensati.on, so that they can beapplied consistently frorn one project to another and from onedeveloper to another. These principles are based on the applica-tion of benefit-cost analysis, and they help to determinewhether either mitigation or compensation is appropriate, andhow much should be soent.

The social benefit-cost framework uses principles of econ-omics to analyse the soclal desirability of investment projecls.It differs from corporate financial analysls in that lt attenptsto include the ful1 costs and benefits of a project to societyrather than just the actual dollars that are expended and re-turned.

Social cost accounting attempts to measure the cost of animpact to society, and does not necessarily reflect marketvalue. For example in the case of outdoor recreation there isno narket va1ue, as it is available free of charge, or atminirnal cost. In thls instance, the.measure used is an estimateof r,shat the recreationist would be willing to pay. Agriculturalland is valued on the basis of return to the 1and, assurning theland 1s cultivated to maximi.ze its potential for various scen-arios of future demand. Forestry impacts are valued on the basisof lost stunpage; fish and wildlife on the basis of lost anglerand hunter days.

The purpose of conducting the analysis in this way i.s todemonstrate that even when all the social impacts are taken j-ntoaccount the project sti11 makes economic sense, i.e. that theallocation of resources is econornically efficient. A furtherobjectlve of benefit-cost analysis is to ldentify who are thegalners and who are the l-osers. This j.s done by examj.nlng theproject from three different perspectlves: - provincial, region-a1 and environmental.

In examj-nj-ng the project from the provincial perspective,all social costs and benefits are included wlthout regard forthe distributlon of these costs and beneflts wlthin the province.It is l-ooked at entirely as a provincial concern. Is it a goodinvestnent for the provlnce or not?

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an

The regional analysis, on the other hand, specifies who

gains and who 1oses, and is therefore concerned wlth whetherihere is some "change of equity'r of specific groups, generallyln the project area. It is thls concePt of equity which isapplied to a large degree in Hydrots mitigation and compensationpolicy. For example' if there would be a 1oss. of existi'ngrecreational areas were the project to proceed, Hydrots objec-tive would be to develop new recreational facilities to compen-

sate for the 1oss, provl-ded j-t can be done within the value ofthe resource 1ost.

The environmental account lncludes a descrj-Ption of lntan-gible environmental and socio-economic benefits and costs whichcannot be evaluated in economic terms. Examples of the latterinclude aesthetic impacts, lifestyle lrnpaets and herltage resourceimpacts.

In summary: The provincial account attemPts to put socialvalues on all the costs and benefi.ts from a provl-ncia1 perspec-tlve; the regional account attempts to define who gains and

who loses, and by how much; and the environmental account at-tempts to evaluate subjectively the intanglble environmental and

"o"io-..onomic i_mpacts which cannot be evaluaLed in economic

lerms.

The provincial income analysis includes scenarios of resourcedevelopment, such as agrlculture, for exampl-e, which vary fromprobable to highly speculative, The purpose of thls-is to see

how sensitive the economic decision on the hydro project is tovarious different scenarios and whether under a particular scen-ario it would be economically more efficient to Preser've existingpatterns of resource use than to develop the resources for power

production. For compensation programs, however, the valuati-onof the resources lost shoul-d be based on realistic expectationsof both future resource use and government Programs for resourcemanagemenE.

B.C. Hydro policy on mitlgation and compensation 1s based

on the concept of maintaining equity for those who would other-wise lose out disproportlonately due to the project, and on theapplication of benefit-cost principles to determine dollararnounts. The policy as published in the Peace slte c ProjectEnvironmental Impact Statement is summarized below with addltion-a1 explanatory notes:

l-. ttMitigation and compensatlon payments for envlronmental

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resource impacts must bear some reasonable relationshl-p tothe value of the resources affected.rl

This means that if the resource lost is estimated tobe worth I million dol-lars it would not be cost ef-fective to spend 5 million dollars to prevent theiurpact from occurrlng, or to compensate for its oc-currence. Ilowever, recognizing that the valuatlonof resource irnpacts cannot be precise, as long as asuitable mitigation measure or compensation programcan be put together for something close to 1 milliondo11ars, then it should be consldered.

"Mitigation expenditures wj-1l be made provided that thebenefits exceed the costs.tt

If a sport fishery estimated to be worth 100,000dollars a year can be maj.ntained through the releaseof minimum water flows during a 1ow flow perlod estim-ated to be worth, say 80,000 dollars in lost powerbenefits, then it should be done. This becomes a mlt-igation measure, part of the project design, and theamount of mitigation whlch is reasonable would bedetermined through project optimization studies.

ttCompensation payrnents would be made only if the loca1 re-gion would otherwise lose out disproportlonately to theremalnder of the province, e.g. if 1oca1 fishermen losttheir fishing resource as a result of development.rt

The objective of compensation payments would be tomaintain social and enviroffnental well-lsing 61equity in the region affected by the development,relative to the provi-nce as a whole. Where a fishingresource would be lost due to development, the corn*pensation program should try to replace the lossthrough some form of fishery enhancement. In develop-ing a compensation program, care should be taken toensure that lt is cost effective. with. the benefitsexceeding the cost.

"Compensation payments will generally be made to the agen-cles directly responsible for the resources affected andwill be used to benefit the region affected. Fundingshould, where possible, be tied to specifi.c programs withbudgets agreed to ln advance.rt

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Suggestions have been made in the past thatall compensatj-on payments should be pald J-nto

the provincial governmentrs general revenueaccount, along with all other general revenues'It would not necessarily be spent in the areawhere the impact occurs. B.C. Hydro does notagree with this approach, as it ls contrary tothe concept of malntal-nlng equity, which isthe foundation for B.C. Ilydrors poli'cy. InIlydrots view the comPensation Payments shouldbe spent in the area where the impact occurson sPecific comPensati-on projects deslgned tobenefit the PeoPle affected.

ItCompensation for conrnunity service impacts will be basedon the social costs imposed by development. These rvil1 be

determined wiLh reference to both impact assessments doneprior to licensing and monitoring programs funded by B.C'Hydro .

This is perhaps the most difficult area toestablish llabi1ity for impacts. For example,Fort St. John has grown from a population ofabout 8,000 in I97L to about 14n000 in 1979(with current estimates of as much as 17'000in early 1981), and no doubt wj-l1 continue togrow as long as there is a demand for oilr nat-ural gas and coal-. The question then becomes

one of how much impact due to any one developeris larger than normal , and .how does one all-o-cate the cost of the dl-verse impacts among

the various developers in an equitable fashion?

In July of 1980 the Province published itsown ttEnvironrnental and Social Impact Compen-sation/Mitigation Guidelines". They are inlarge measure conslstent with B.C. Hydrorswith two notable exceptions: 1') less emphasison equity as the fundamental rationale for com-

pensation and mitLgatlon and 2.) provisionfor compensatlon paynents to be paid to theprovlnclal goverffnent without necessarl1y belngearmarked for specific programs. Whether thesedifferences will turn out to be important inpractice remains to be seen. B.C. Hydro wil-1continue to base proposals for compensatlonmitigation and to attemPt to negotlate

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settlements on the basis of the policy out-lined for Site C.

Mltigation and Compensation for Site C

B.C. Hydro requested its consultants to identify opportun-ities for mitigation and compensation for anticipated lrnpacts.The najor proposals j-nvolving capital expendltures were thenanalyzed in accordance with the principles outlined above.

The following possibllities are presented as examples ofthe sort of compensati-on programs which Hydro feels would beappropriate, and to illustrate the appLication of the beneflt-cost pri-ncipl-es to mitigation and compensatj-on lssues. TheactuaL development of a comprehensi-ve program for the Site C

environmental impacts is being undertaken by the governmentagencies under the coordination of the Mlnlstry of Emrlronment.

General Recreati.on:Facilities should i.nclude plcnie areas, boat launehj-ng

facilities and campgrounds, and it is estimated that the lmpactcould be fu11y compensated wlth an j.nvestment in these kinds offacilities of a 1itt1e over 1.mi11ion do11ars. The extent andlocation of the facllities should be determined i,n consultationwith 1oca1 government and special interest groups.

Fishlng:Up to 2 million dollars could be spent on fish production

or enhancement facilities. A number of suggestlons r^rere madeby the consultants, and these are under actlve conslderation bvthe Ministry of Envirorunent.

Hunting:Up to 3/4 mil-1ion dollars could be spent for r^rll-d1ife en-

hancement programs l-n order to maintain the present huntingharvest.

Guiding and TrappingiThe loss of income to guides and trappers is relatively

small: about $12,000 for trapping and $1,000 for guiding. Hydrohas a Registered Trapline Program operated cooperatively withthe Ministry of Enviroffnent and the Brltlsh Columbla TrapperrsAssociation aimed at developing trapplng potential Ln parts ofthe land not affected by the project while maintaLning the sameincome as before the project.

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Forestry:Without the project it is unlikely that the sma1l amount of

isolated inaccessible merchantable tirnber in the Site C area

would ever be harvested. Thus, no social or regional costs would

be incurred in the forest sector if the Project would be built'Hydrors position is that any revenue frorn the harvestable timberriff n"fp to offset the much higher cost of reservoir clearing'and no compensation is due.

AgriculEure:

--Edr.-+osition on the impact on agricullural resources in

the Peace area j-s that the industry might evolver at mostt toserve a reglonal markel, and that the impact of the Peace Site C

project alone would not irnpair the ability of the-industry torealj:ze this potential. C-onsequentl-y, B'C' Hydrots liabilitydoes not extend beyond the purchase of privately owned agri-cul-tural land which would be flooded by the reservoir '

Mineral Resources:There would be no significant loss of mineral resources and

no compensation would be due.

Heritage Resources:The value of impacts on archaeological and historical sites

is impossible to ascLrtain. The sj-tes are undoubtedly of inter-est and value, but it is so far impracticable to estimate what

that value rnight be in do1lar terms. B.C' Hydro has alreadyspent almost half a rnillion dollars j.n archaeological investj-ga-tions, and any further expenditures would have to be determinedas part of the certification process.

Communi-ty Servl-ce ImPacts :

The specific degree of impact of Site C on community ser-vices in the project area is extremely difficult to determine'Thisisduetotheunpredi.ctabilityofthegrowthrateinFortSt.John,resultingfromuncertainmajorexternalinfluencessuch as federal ..t"tgy policy affecting oil and gas explorationtpipeline constructi"", p.tao-chemical proposals and coal devel--

opment.

While the increase in population related to the project willplace increased demands ott t"tty soci-al and physical services inthe community, causing congestion and decreased guality of ser-vice in some instan".., th. Project will generate signiflcantlocal benefits in Laxes' income and employment which wl11 sub-

stantially offset these costs. certain increased costsr such as

in education, do not become an additional burden to the local

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area because the provlnclal agency responsible will pay theadded costs.

B.C. Ilydro believes that the most practical and equitablemeans of dealing \n7ith the uncertainty associated with projecti-mpacts is to conduct an ongoing impact rnonitorlng program withfu11 co-operation and input from the 1oca1 communities, to deter-rnl-ne the nature and degree of proJect impacts as they actuallyoccur and to make any compensation to the communlty, if required,on thi.s basis.

PROJECT LICENCING

The new B.C. Utilities Commlssion Act C1980) provides fora comprehensLve envj-rorunental and technical review of major en-ergy projects proposed by either the publlc or private sector.The Energy Review Process is the formal mechanism establishedto arrive at decisions on these proJects.

The legislatl-on requires that an application be made tothe Mlnister of Energy containing detailed information on eachproject and analysis of 1ts impacts. The Minister of Energy,in consultation wlth the Minl-ster of Environment, decides whetherthe proJect should be exempted, whether it should be referredto the B.C. Utiliti.es Conrnission for a public hearing, orwhether it should be referred to the B.C. Utilities Commissionto be considered for a Certificate of Public Convenience a.ndNecessity. When the project is examined by the Utilities Corn-mission in a public hearing under the Energy Project RevlewProcess, a report and recouunendation are tendered to the Cabin-et where the final decislon is reached. Cablne.t may declde uponapproval or rejectlon of a proposal and appropriate terms andcondltlons, If a project 1s approved, an Energy Project Cer-tificate is issued authorizing construction of the proJecg.

A regulation under the Utllities Counnission Act sets outthe information and studj.es which the applicant must prepare andsubmit. These include a physical and econornLc description ofeach proposed project; an environmental lmpact sEudy, feaslbllltystudLes and a benefit/cost analysis. If a hrater 1icense or po1-lution control licensing are being sought simultaneously, spec-ialized information also is required bv the Government in these4r C4E .

An Energy Project Co-ordi.nating Committee has been organ-ized by the Government to process applications up to the stage

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when they are turned over to the B.c. utilities commission forpublic hearj-ngs' evaluation and recommendation' The energyirojeet Co-ordinating Committee is a permanent steering committee

comprised of one senior staff member from each of the energyministry, the envirorunent ministry and the B.C. Utilities Com-

mission. The main responsibilities of the Energy Project co-ordl-nating Committee are :

1. Ensuring that the application requirenents for infor-mation and studies are met by the Proponent '

2.Co_ordinatingtheinputoftheseveralgovernmentmin=l-stries whose responsj-bilities are affected by an energyproj ect .

3.Co-ordinatinginthepreparationoftermsofreferencefor public hearings by the B.C. Utilities Cormnission'

The public hearing phase of the Energy Review Process willbe the focal polnt for input by the general- public and j-nterestedparties. Revj-ew panels will be comprised of comrnissioners ofthe Utilities Commission and others appointed to bring speci-alizedexperience or backgrounds to bear on project issues'

B.C. Hydro applied for an Energy Project Certificate forthe Site C project in September 1980. To date the terms ofreference and date for a public hearing have not yet been an-nounced by the goverilnent.

REFERENCES CITED

British columbia Hydro and Power Authority. L976. Revel-stokeProject Benefit-Cost AnalYsis.

British columbia Hydro and Power Authority. 1980 a. Peace Site c

Project Environmental Irnpact Statement.

British columbla Hydro and Power Authority. 1980 b. Peace site c

Project Appllcation for an Energy Project Certificate'

British columbia Hydro and Power AuthorLty. 1980 c. Peace Site c

Project Benefit Cost AnalYsis.

Province of British colurnbla. 1977. "Guidelines for Benefit-Cost Analysisrr. Envi-ronment and Land Use ConunitteeSecretariat.

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Province of British Columbla. l-980. t'Environmental and SociaLImpact Compensation/Mitigation GuLdelinestt. Enviroffnentand Land Use Cornmittee Secretariat.

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