The taxpayers of sa国际传媒 could face a heftier bill than expected for the new Site C hydro dam, but Premier Christy Clark broke that news to New Yorkers, rather than to her own voters.
In an interview this week with the Bloomberg news service in New York, Clark said the $7.9-billion estimate for sa国际传媒 Hydro鈥檚 planned project is low, and the figure could be closer to $8.5 billion.
Big projects like the Site C dam prompt a predictable dance that is reminiscent of many an argument on the elementary-school playground. The government says the construction will cost X and not a penny more. Critics and the opposition say that鈥檚 nonsense and the cost will obviously be higher. 鈥淲ill not cost more,鈥� says the government. 鈥淲ill too cost more,鈥� says the opposition.
For months, the government has insisted that $7.9 billion is a solid figure, no matter how often others heaped scorn on the numbers.
When word of Clark鈥檚 sudden change in arithmetic drifted westward across the continent, it caught just about everyone by surprise.
Energy Minister Bill Bennett told puzzled reporters that the original figure was still the one Hydro is working with, but the government asked the utility to crunch the numbers again and allow for unexpected additional costs. The budget already had contingencies built into it, but apparently the government wanted more. It wanted the figures to take into account more 鈥渟cenarios.鈥�
The scenario behind the premier鈥檚 statement was one of those, but according to Bennett, not the highest one. He told reporters he doesn鈥檛 yet know where the 鈥渦pper range鈥� is.
One part of the new calculation is the sudden realization that the province ditched the harmonized sales tax and went back to the provincial sales tax, which will tack on about $200 million. Bennett said the tax implications 鈥渟lipped by鈥� the experts. Since we chucked out a premier and held a referendum over the tax, it鈥檚 hard to imagine how its fallout could have escaped the people who are supposed to keep track of the province鈥檚 finances.
The government obviously wants to cover itself in case the cost balloons, so it鈥檚 adding contingencies and allowing for interest-rate increases. That makes sense from a political point of view, but then why insist for so long that $7.9 billion was carved in stone? Did it lose faith in sa国际传媒 Hydro鈥檚 ability to project costs?
And why go from a fixed cost to a range with no upper limit yet in sight?
This could be an opportunity to take a second look at the whole project.
While it鈥檚 attractive to think of electrical power that doesn鈥檛 require burning fossil fuels, Site C means yet another beautiful Interior valley will be flooded to supply that electricity. People will be displaced, farms and houses wiped out so other British Columbians can flick on the lights.
Few of the people in the nicely illuminated False Creek condos will ever see the 55-square-kilometre lake that submerges what were once homes and livelihoods. Politically, 鈥渙ut of sight, out of mind鈥� is a formula that still appeals to governments.
The need for and economics of the most expensive public project in sa国际传媒鈥檚 history are debatable, especially since the government excluded it from review by the sa国际传媒 Utilities Commission, as it has done too often with its pet projects.
The newfound uncertainty in the cost of the dam is a warning to all of us. The government has essentially admitted its schoolyard rival was correct to say: 鈥淲ill too cost more.鈥�
