FORT ST. JOHN, B.C. - Just weeks after reports to the BC Utilities Commissioned (BCUC) warned of the risks of Site C missing crucial project timelines due to issues with riverbank cracks, BC Hydro officials have confirmed those fears.
In a recent letter to the BCUC, BC Hydro president Chris O'Riley explained that due to geotechnical and construction challenges it will not be able to start the project's river diversion in 2019. However, he remains confident.
"While this will set some activities back a year, we had a one year float built into our schedule and are confident we can still deliver this project on time, by November 2024," wrote O'Riley.
BC Hydro does believe the budget will take a hit. It estimates the missed milestone will increase the cost by 7.3 per cent, or $610 million, for a total forecast project cost of $8.945 billion.
"We've retained the contingency and it remains available to prudently manage risks on the project," wrote O'Riley.
Other sources say the costs could be much higher.
According to Deloitte, an auditing firm retained by the BCUC as part of its review of the project, missing the diversion will cause a one year delay and could raise the costs from $8.8 billion to between $9.1 billion and $10 billion.
BC Hydro is also predicting other risks, including completing the procurement for the generating station and spillway, the second largest procurement of the project. Despite this, in the letter to the BCUC, BC Hydro maintained that suspending or terminating and finding alternative power sources would cost billions more than completing Site C.
The BC Hydro letter also highlighted that Deloitte has acknowledged their portfolio of alternative resources underestimated cost by 25 per cent and does not provide sufficient capacity due to reliance on outdated information on BC Hydro facility upgrades.
The first tension cracked appeared on the left bank in February.
The 400-metre tension crack temporarily stopped some construction activities, but BC Hydro said it is since been resolved. However, a smaller tension crack was observed on the left bank of the dam site in May.
O'Riley, BC Hydro experts and representatives will host a Technical Panel Session on Oct. 14 to answer questions and elaborate further on the project challenges.
"Ratepayers are still best off in a scenario where BC Hydro proceeds with Site C as planned," wrote O'Riley.
B.C. Premier John Horgan tasked the BCUC with analyzing the financial impacts of building, scrapping or delaying the project back in August. The full report from the BCUC will be issued on Nov. 1.
JOC News Service