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Opposition worried gov is pressuring hydrogen company over PG proposal

Proposed local hydrogen plant implicated in minister’s email
Fortrescue’s executive chair Andrew Forrest speaks in Prince George on the possibility of locating a hydrogen plant in north-central B.C. (Frank Peebles photo - Quesnel Cariboo Observer)

Could British Columbians receive a break on their hydro rates in next year’s budget and could a private company planning to build a hydrogen-plant in Prince George pay $1-billion toward it as part of a deal with the provincial government?

Those two separate but related questions emerged after the release of an email from energy minister Josie Osborne. BC United says the email paints a “very troubling picture” in accusing the government of intimidating companies in search for “big and shiny affordability measures.”

But Osborne said her email to herself capturing evidence from an unnamed advisor in her office reflects ideas under consideration but not final decisions.

Central object of the discussion is a proposal by the Australian company Fortescue to build a green hydrogen plant in Prince George that would employ 250 people and could produce 140,000 tonnes of green hydrogen and 700,000 tonnes of ammonia per year. These resources would then be used to make green steel.

Mike de Jong, MLA for Abbotsford West, said during Question Period on Nov. 23 that Osborne is proposing an order-in-council to gain “leverage” with companies like Fortescue. An order-in-council would give government the authority to waive or reduce costs associated with large projects if they agree to conditions.

“‘You (the company) are either going to pay BC Hydro $1-billion under the existing tariff or agree to scale down the size of your project,’” he added, quoting from the email. “Can the minister explain what appears to be a clear threat?,” De Jong asked. “And what does she mean when she says she wants to acquire leverage over Fortescue?”

De Jong later said that the whole approach of the government “seems to be to intimidate” people trying to invest in B.C. in speaking of a “thinly veiled threat.

“It also makes it clear that the government and the premier are more interested in politics when it comes to providing relief to British Columbians,” he added.

De Jong was referring to the opening part of the email.

“If PDE (premier David Eby) is looking for a big and shiny affordability measure for (budget), we should push them to look into option of returning a portion of incremental carbon tax back to people on their monthly BC Hydro,” it reads. “Instead of giving people a one-off bill credit or increasing quarterly CATC (Climate Action Tax Credit) payments, we could give them ‘CleanBC rebates’ that show up on their monthly BC Hydro bills. We could announce that we are going to use carbon tax revenues to FREEZE BC Hydro rates for people.”

De Jong said that portion of the email shows government under pressure over the issue of affordability.

RELATED: Canada’s first renewable diesel and hydrogen complex to open in Prince George

When reporters repeatedly asked Osborne after Question Period whether her government is really thinking about asking companies for $1-billion or force them to scale back their operations, she called it an idea, not future government policy.

“Again, this is advice that’s coming to me, this is not a decision,” she said. “These are notes on a piece of paper. This is advice that gets considered and lots of things get put on the table and decisions get made later.”

She offered the same line when asked about the possibility of a freeze.

Eby first defended the project and the search for affordability measures during Question Period, then later at a meeting with business leaders, where he described the plant as a “huge, singular” opportunity for British Columbia given the size of the global market for green steel. But he also acknowledged the project’s practical difficulties as it would require 1,000 megawatts of power.

“(That) is massive, so the challenge for us is, we want those jobs, we want this plant, and we’re entering in discussions and negotiations with Fortescue, how do we seize this opportunity without making British Columbians pay higher rates on their hydro bills for that opportunity to be delivered?,” Eby said.

British Columbia has to negotiate with Fortescue, he added. “(We) have to negotiate with many of the companies, who are thinking about locating here in B.C. because the Inflation Reduction Act in the United States gives them opportunities to go south of the border instead of locating here in B.C.”

He also defended the search for affordability measures, including the possibility of using carbon tax revenues to freeze Hydro rates, the very scenario outlined in Osborne’s email.

“I am absolutely looking for big affordability measures for British Columbians and I want them to shine,” he said. “I want British Columbians (to know) that we are delivering for them on affordability,” he added, pointing to various past policies. “I have asked every single minister, ‘Look at the your file, find ways to deliver affordability for British Columbians.’”

De Jong did not reveal from whom and how he gained Osborne’s email, which Osborne described as a “copy-and-paste” of advice which she had received before sending it to herself.

“Clearly, I dropped it and that’s my mistake,” she said. “So this is something that can happen from time to time. It’s not great, but it means that it is showing people how are hard we are working.”

She added — which Eby then later confirmed — that government is considering a hydro rebate. “We are taking everything in advisement around what steps we can take to support affordability for British Columbians.”

For de Jong, the email is evidence of his party’s argument that CleanBC is costing British Columbians, pointing to a part of the email, which states current hydro rates “would make most (large) projects uneconomic to proceed” unless cabinet passes an order-in-council to give the government the authority to waive or reduce these costs if companies agree to certain conditions.

“They are desperately trying to sustain their brand around CleanBC as this growing body of evidence emerges that it is going to have a devastating impact on not just the economy as a whole, but on families in particular.”

Black Press Media has reached to Fortescue for comment.


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Wolf Depner

About the Author: Wolf Depner

I joined the national team with Black Press Media in 2023 from the Peninsula News Review, where I had reported on Vancouver Island's Saanich Peninsula since 2019.
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