A collective sigh of relief may have been heard in Williams Lake today on the news that a major employer there – the Atlantic Power plant – will not be shutting down.
More than a year ago, the owners of the company announced the power plant would shut down, due to a lack of security on biomass and electricity purchase rates with BC Hydro that are too low to keep the plant running economically.
Williams Lake city council has been lobbying the provincial government for months now to prevent the closure of the plant, which employs 50 people directly and provides the city with $1.7 million in tax revenue.
On Friday, BC Hydro announced that it, the B.C. government and Northwest Energy had come to an agreement to keep the Atlantic Power plant operating.
“It’s great news,” said Williams Lake Coun. Scott Nelson. “It really removes 14 months of significant insecurity and unsettlement in the community and the region.”
The plant burns forest residue biomass to produce about 66 megawatts of power, enough electricity to power 50,000 homes.
It is among the many independent power producers that developed power projects in the 1990s through electricity purchase agreements with BC Hydro, some of which have expired or are nearing expiration.
The plant’s agreement was to expire in 2019, but got an extension allowing it to continue operating until 2029.
But in January 2024, the company that owns the plant issued a 12-month notice that it would be shutting the power plant down, saying it would not be economic to operate, due to fibre insecurity and insufficient electricity rates from BC Hydro.
Energy Minister Adrian Dix said Friday that BC Hydro and his government has reached an agreement with the company to keep the plant open.
“Working together with Atlantic Power, and in collaboration with a cross-ministry government working group, BC Hydro has negotiated an agreement that will keep the facility operating into the future," Dix said in a press release.
The press release states that the plant will continue to operate for the remaining term of the agreement, which presumably is 2029.
It is not clear from the release whether the agreement deals with the rates in the electricity purchase agreement with Atlantic Power. It does appear to address the fibre supply issue, however.
“The challenge Atlantic Power’s Northwest Energy facility was facing was due to a shortage of cost-effective fibre – the wood-waste it requires to burn as fuel to create electricity,” the BC Hydro release states.
“The province and BC Hydro have worked diligently and closely with Atlantic Power over the past many months to address these challenges. Through this collaborative work, Atlantic Power has been provided with a number of recommendations for optimizing their operations such as for sourcing and managing cost-effective fuel.”
