1980 Legislative Session: 2nd Session, 32nd Parliament

HANSARD

The following electronic version is for informational purposes only.

The printed version remains the official version.

Official Report of

DEBATES OF THE LEGISLATIVE ASSEMBLY

(Hansard)

WEDNESDAY, AUGUST 20, 1980

Morning Sitting

[ Page

4057 ]

CONTENTS

Routine Proceedings

Insurance (Motor Vehicle) Amendment Act –– 1980 (Bill 24). Committee stage.

Third reading –– 4057

Revised Statutes Correction Act (No. 2), 1980 (Bill 61). Second reading,

Hon. Mr. Williams, –– 4057

Attorney-General Statutes Amendment Act, 1980 (Bill 55). Second reading.

Hon. Mr. Williams –– 4057

Mr. Macdonald –– 4057

Hon. Mr. Williams –– 4057

Municipalities Enabling and Validating Amendment Act –– 1980 (Bill 48). Second reading.

Hon. Mr. Vander Zalm –– 4058

Mr. Howard –– 4058

Hon. Mr. Vander Zalm –– 4058

British Columbia Place Act (Bill 46). Second reading.

Hon. Mr. Rogers –– 4058

Mr. Macdonald –– 4058

Mr. Cocke –– 4059

Mr. Howard –– 4060

Hon. Mr. Rogers –– 4061

Division on second reading –– 4061

Mineral Amendment Act, 1980 (Bill 62). Second reading.

Hon. Mr. McClelland –– 4061

Mr. Howard –– 4062

Hon. Mr. McClelland –– 4062

Utilities Commission Act (Bill 52). Second reading.

Hon. Mr. McClelland –– 4062

Mr. Skelly –– 4063

Mr. Davis –– 4066

WEDNESDAY, AUGUST 20, 1980

The House met at 10 a.m.

[Mr. Davidson in the chair]

Prayers.

MR. REE: Mr. Speaker, it's always a pleasure when constituents visit

the House in Victoria. Today in the gallery are Mr. Don Murray, his wife Rosalynn,

and their children Karen and Colin, a family from North Vancouver. I'd ask

the House to welcome them to the assembly and to Victoria.

HON. MR. McCLELLAND: I'd like to ask leave to table documents I referred to in debate on a bill yesterday.

Leave granted.

Orders of the Day

HON. MR. GARDOM: Mr. Speaker, I understand that it is desired that the public accounts committee sit

this morning. I therefore ask leave to make a motion to permit that to

happen.

Leave granted.

HON. MR. GARDOM: I move that the Public Accounts committee be permitted to sit during the morning session of the Legislature.

Motion approved.

HON. MR. GARDOM: With leave, I proceed to public bills and orders.

Leave granted

HON. MR. GARDOM: Committee on Bill 24, Mr. Speaker.

INSURANCE (MOTOR VEHICLE)

AMENDMENT ACT, 1980

The House in committee on Bill 24; Mr. Strachan in the chair.

Sections 1 to 11 inclusive approved.

Title approved.

HON. MR. HEWITT: Mr. Chairman, I move the committee rise and report the bill complete without amendment.

Motion approved.

The House resumed; Mr. Davidson in the chair.

Bill 24, Insurance (Motor Vehicle) Amendment Act, 1980, reported complete without amendment, read a third time and passed.

HON. MR. GARDOM: Second reading of Bill 61, Mr. Speaker.

REVISED STATUTES

CORRECTION ACT (NO. 2), 1980

HON. MR. WILLIAMS:

Mr. Speaker, this second correction act was necessary in order to

complete the clerical and other non-substantive changes in the revised

statutes flowing from the tremendous work that was involved in the

revision.

I believe that if the members have any questions

with respect to the legislation they can more appropriately be dealt

with at the committee stage, when

section by

section I will be able to

respond to concerns.

I move second reading.

Motion approved.

Bill

61, Revised Statutes Correction Act (No. 2) 1980, read a second time

and referred to a Committee of the Whole House for consideration at the

next sitting of the House after today.

HON. MR. GARDOM: Second reading of Bill 55, Mr. Speaker.

ATTORNEY-GENERAL STATUTES

AMENDMENT ACT, 1980

HON. MR. WILLIAMS:

Mr. Speaker, the number of statutes which fall under the administration

of the Attorney-General is such that from time to time each year it has

been found desirable to make minor statutory changes through a

miscellaneous statutes amendment act. This one is no different. Again,

while I'm not suggesting that some of the amendments are not

significant, I think it would be more valuable to the members if they

were dealt with in committee.

I move second reading.

[Mr. Strachan in the chair.]

MR. MACDONALD:

Mr. Speaker, I agree that this bill might be better considered in

committee. I just want to refer to one matter of importance in it. The

right of the benchers is improved in that they can now, as if they were

a court of law, fine a barrister up to $10,000, without any power to

impose incarceration. The reason I refer to that is that I think it's a

good amendment. I think it's necessary for a profession to have that

disciplinary power over its members, but a fine of $10,000 is a pretty

big exercise of public power. So the lawyers association is no longer a

private body; it's a quasi-public institution. The other day the

Attorney-General spoke in terms of being generally in favour of the

principle that there should be public representation among the benchers

of the Law Society of British Columbia. I just want to say that I

second that view. When these kinds of extraordinary but necessary

powers are being given to a private body, we must be sure that it is

representative and responsive to the whole community.

DEPUTY SPEAKER: The minister closes debate.

HON. MR. WILLIAMS: I thank the second member for Vancouver East (Mr.

MacDonald) for his indication Of support. As he is very well aware, other

professions have the power to impose fines without limit — chartered accountants

[ Page 4058 ]

for one. There is no limit in their statute, Mr. Member, as you well know.

May

I just say that I announced to the press, during the course of my

estimates, that I'd be meeting with the representatives of the benchers

about September 1; the meeting, in fact, is on September 3. The matter

raised by the member will be dealt with at that time.

I move second reading.

Motion approved.

Bill

55, Attorney General Statutes Amendment Act, 1980, read a second time

and referred to a Committee of the Whole House for consideration at the

next sitting of the House after today.

HON. MR. GARDOM: Second reading of Bill 48, Mr. Speaker.

MUNICIPALITIES ENABLING AND

VALIDATING AMENDMENT ACT, 1980

HON. MR. VANDER ZALM:

Mr. Speaker, this act eliminates the unnecessary documentation and

delays in obtaining land use approvals in designated floodplain areas

in the lower mainland. The amendment will provide a means of

eliminating unnecessary red tape and delays in obtaining land use

approvals. Previously any amendment to an official planned bylaw or

zoning bylaw or the issuance of a development permit was subject to my

approval where the lands concerned were within the floodplain as

defined in the lower mainland regional plan. The amendment would permit

me, by regulation, to define areas and circumstances where such

approval would not be required. In some areas, where it has been

determined by the adoption of community plans or by agreement with the

Ministry of Environment that development may take place, individual

approvals would not be required. This amendment act also identifies two

new areas for the installation of a system of sewers in the district of

Richmond.

Mr. Speaker, I move second reading.

MR. HOWARD:

The first member for Victoria (Mr. Barber), who is the spokesperson

with respect to municipal affairs, is also a member of the public

accounts committee and is currently meeting in that committee. He

advised me — in fact, an advice bordering on instruction — to indicate

to the House that I could say on his behalf that we look favourably

upon this particular bill, but that the minister should not expect the

same consideration when it comes to Bill 54; that's an entirely

different category.

HON. MR. VANDER ZALM: I'm naturally very pleased with the response from the opposition, and I look forward to Bill 54. I again move second reading.

Motion approved.

Bill

48, Municipalities Enabling and Validating Amendment Act, 1980, read a

second time and referred to a Committee of the Whole House for

consideration at the next sitting of the House after today.

HON. MR. GARDOM: Mr. Speaker, I call second reading of Bill 46.

BRITISH COLUMBIA PLACE ACT

HON. MR. ROGERS:

I take this opportunity to briefly describe to the House and the

members the essence of this bill. The bill is basically designed to

grant similar powers and capabilities to British Columbia Place Ltd. as

those found in the statutes of other Crown corporations. The act itself

is in essence a very simple form of legislation. It concerns neither

social nor regulatory legislation; instead it merely grants special

statutory powers to the corporation.

There are several

factors in this bill which need to be highlighted for the benefit of

members. The bill itself simply establishes British Columbia Place Ltd.

as a Crown corporation with the shares transferred directly to the

Crown in the right of the province. The bill also establishes the

Minister of Finance (Hon. Mr. Curtis) as the fiscal agent of the House.

It is a move which will ensure both fiscal accountability and

responsibility of the corporation's financial affairs. The act is

designed to prevail over other inconsistencies in the Companies Act or

in the memorandum or articles of the company — those documents which

serve as the company's own constitution's bylaws.

addition, the act provides that the Lieutenant-Governor-in-Council has

the maximum flexibility to remove or avoid legal legislative

impediments, which is timely, and for economical development of British

Columbia Place and the site and the amphitheatre.

Funds are

also a factor worthy of consideration. The act does not permit the

advance of funds to the company in unlimited amounts without first

obtaining legislative approval. Instead, by this bill, the Minister of

Finance is limited to advances from the various funds involved.

Furthermore, the act directs that the government guarantee the

borrowing of the Crown corporation. Obviously, Mr. Speaker, the company

must first be able to establish its ability to borrow the funds

required for business purposes. In other words, the bill provides for

the corporation the opportunity to find a tender who will accept its

ability to repay the amounts borrowed from its operating revenues. It

is worthwhile to point out that such guarantees are first subject to

the approval of the government and, secondly, are on the terms and

conditions set forward by the Lieutenant-Governor-in-Council.

Finally,

an important point is the concern about the expropriation powers of

this act. While this power has been included in the act, it's for the

sole purpose of acquiring land needed for the establishment and

planning of the British Columbia Place site and the geographical

definitions. To that extent, I'll be moving the amendment standing in

my name on the order paper in committee stage. This distinction is only

to provide for greater certainty and clarity to define the location of

British Columbia Place.

I move the bill now be read a second time.

MR. MACDONALD:

Mr. Speaker, the official opposition welcomes international expositions

and monuments in the form of Robson Square, B.C. Place, and things of

that kind. What we regret is the want of business acumen on the part of

the minister and his government. This bill could be better called

"Bennett in Blunderland," not B.C. Place. I

[ Page 4059 ]

was sitting up enjoying a sleeping potion about 11:30 the other night, when I saw the hon. minister.

Interjections.

MR. MACDONALD:

I had a very good rest that night. I wasn't at all disturbed by what I

saw. There on the box was the face of the minister. I presume that what

I was watching was not hearsay evidence, but it was what the minister

really meant. He was giving a wonderful description of B.C. Place and

the roof of the stadium. He said: ''Two hundred acres...." I thought we

were only getting 160 acres from the CPR, but it keeps going back and

forth and up and down.We're never quite sure what it is, but on that

particular night it was 200 acres.

Yet I thought the

minister was doing his assignment from the Premier in good taste. He

gave a very excellent presentation of the castles that are to be built

on the site, but he didn't tell the wondering people of British

Columbia that they hadn't got a handle on the land on which this....You

didn't mention the land. You didn't mention the CPR. There was not a

mention on this program — I know it was only about four minutes — about

how the CPR had taken this land from the Indians and now the government

was going to acquire it from the CPR and give back to the CPR the

minister's own riding of Vancouver South, which used to be CPR land. In

order to get the False Creek bottom lands, it's going to be necessary

for this government to give them Vancouver South, or the Peace River,

or something of that kind — possibly Prince George — to pay for it.

The

minister said 200 acres; he's got expropriation powers in this bill. He

can't expropriate the CPR, because they've kept this land in their

railway company. They haven't even put it into Marathon. Even

expropriating Marathon under a provincial statute is pretty dicey,

because the CPR is one of the great institutions of this country — they

own it, or a good chunk of it, at any rate.

This bill is an

incredible record of bungling, and now to cover themselves they've

introduced into the bill. Mr. Speaker, a power to expropriate the CPR

railway lands in False Creek, which is an empty power and an empty

threat. They've given themselves, on the public treasury. an unlimited

borrowing power that can be guaranteed by an order-in-council of the

cabinet. So by this bill the Legislature, I think for the first time in

the history of British Columbia, is giving unlimited borrowing powers

to a corporation, known as B.C. Place. Even B.C. Hydro doesn't have

that: they have vast commitments and vast contingent liabilities of the

province, but there's always a limit on their borrowing power. There's

no limit here.

I think when this bill comes to committee the

minister is going to have to be asked to explain just how much it is

going to cost to get the land from the CPR, and whether the CPR is not

in a position to hold up the people of the province now.

MR. HOWARD: They always have been.

MR. MACDONALD:

They always drove a pretty hard bargain, but they've never found

themselves lucked-out into the kind of situation they are in today,

where they've got the purchaser saying: "We're all go; we can't back

out of the deal." The only thing to be agreed on is the price, and Big

Julie is going to name a pretty stiff price.

Anyway, I

appreciate the rest I had after watching the minister, and I look

forward to his answers. probably in committee — and probably no answers

at all, because he's in a box. We should all feel sorry for him, but we

should feel even more sorry for the people of the province.

MR. COCKE:

Mr. Speaker, we're running into rather strange circumstances in the

Legislature of recent weeks. What we see on one hand is a Minister of

Finance first talking about tightening the old belt because of world

conditions, and then putting a freeze on hiring, which met a fair

amount of resistance and the freeze became a thaw to some extent. We

see a government moving in a number of directions, not quite knowing

which way to go. But the one place where they have shown evidence of

hanging in there, so to speak; is in the area of their monuments.

Now

B.C. Place is nothing more or less than a government desperate to look

like they are doing something, to look like they are appealing to one

side of our community, at least, probably the sporting area of the

community. We know they are mixing this up, of course, with Transpo,

this international exposition that is hoped to be held on same site.

Mr. Speaker, we see a government so desperate for attention that they

remind you of a little child that gets into trouble in order to get

attention. That's precisely what they have done: they've got into

trouble in order to get attention.

The trouble, of course.

as my colleague for Vancouver East says, is with the CPR. The history

of that noble company, that great corporation. Is that they brought the

railroad to Port Moody as they had promised. Now Port Moody was on the

Pacific Ocean. and so they had done their job. They brought it into

Port Moody. and that's where they stopped. Well, at that point people

in old Vancouver, Hastings Mill, or whatever you wanted to call it at

the time — where the real natural harbour was, and where the real

potential for development was — naturally were woebegone. The

government of the province said: "What are you doing" As a result,

negotiations began. Those negotiations ended up with the CPR, as my

colleague says, owning the very best part of Vancouver, that part which

is now Shaughnessy. that part which is now Arbutus, that part which

includes Gracie's Finger — believe it or not — recently put-chased from

the CPR.... But they've struck a very hard bargain. Mr. Speaker, and

I've seen nothing in the intervening years....That was in order for

them to bring the railroad from the then terminus, which was at Port

Moody, to the Vancouver harbour. Well. Mr. Speaker, I've seen nothing

in the intervening years to tell me that they're going to be any easier

to deal with now than they were then.

Now it would strike

me. If we were doing things in proper order, that what we would first

do would be strike a bargain with the CPR before we commit ourselves to

the site. Once having committed ourselves to the site, then the CPR can

get whatever they want. and that's why the opposition is so opposed to

this, way of doing business. When this government was elected, they

were elected on the premise that they were the business-oriented group

and that the NDP — then the government — wasn't all that business

oriented, Well. Mr. Speaker. I want you to compare any of the deals

that the NDP made — any one and every one of them — with this

abominable thing, with this absolute lack of any kind of business

orientation — or at least a government with a lack of any business

orientation — in order to put a travesty like this forward.

Mr. Speaker. we know that these are tough times. We know that — providing this B.C. Place ever gets going —

[ Page 4060 ]

there

will be some people employed building it. But we also know that there

are a lot of people who are going to have to pay for it, and it

concerns us that we don't know what they're going to have to pay; we

haven't a clue. All we know is that the government has unlimited

borrowing power and they've vested their unlimited borrowing power in

B.C. Place. This is a corporation that can run away with money, and

over the years we've seen the Socreds manage to put together these

kinds of instruments that have really cost us. The necessity of it —

who knows? The placement of it — it strikes me we should have some

opportunity, some options, and those options would give us some

leverage with the CPR. Presently we have no leverage whatsoever.

When

somebody gets on the phone to the head office of the CPR and says, "Now

the Ministry of Environment in B.C. wants to negotiate, " they'll say,

"Well, in our own time, in our own fashion, and the outcome will be

ours." They remember not long ago that they were somewhat frustrated in

an attempt to take controlling interest of a major lumber company in

this province. I'm not too sure whether that will have too much

influence, but I'm not too sure it won't. That's the problem. I think,

Mr. Speaker, that the B.C. Place Act is doing things absolutely

backwards. We're now committed to an area where I consider that the CPR

will exact a toll from us that will be quite unacceptable. It's a

shame. It's a shame to have been put in that position.

Now

having said that, where else could it go? There are other options. We

need not have committed ourselves to them, but at least we would have

some kind of an alternative and the CPR would have known it. Now they

know we haven't. I just want to wish the minister a lot of luck and I

want to suggest that unless he has an awful lot of luck, he's going to

be under severe criticism for having done the bidding of the president

of the executive council of British Columbia, who so desperately wants

to have this monument to himself placed squarely in the middle of

Vancouver. It is a very interesting Phenomenon, and I would find it

very difficult to support.

MR. HOWARD: When we first

heard about B.C. Place this year, it had a ring of unreality about it,

especially to those of us who don't happen to live in Vancouver and who

have for a long time felt that the financial wherewithal to pay for

some of these great monuments comes from the rural areas. In other

words, people in the north, in the Okanagan and in the interior will be

paying a fair amount of the cost of this particular monument.

They've

paid for some of it already. For instance, here's taxpayers' money

being used for the front page of British Columbia Government News, a

camouflage publication primarily supporting Social Credit. It's

misnamed and misused. This is the document that taxpayers paid for that

says, "Here's British Columbia Place" — front page, artist's

conception. Inside we have another artistic overlay of a photograph of

a portion of Vancouver including the downtown-West End area and False

Creek. The artist's overlay there, in yellow — an appropriate colour, I

might add — shows that the whole north shore of False Creek, running

from Main Street — from what I can see here — out towards Granville

Bridge is going to be encompassed in this B.C. Place. It's identified

as a development for the future.

There's a committee established with respect to B.C. Place that might be

worthwhile to identify. It's called an action committee, "headed by

Environment Minister Stephen Rogers. He has been named to take on the task of

turning the concept into reality. Other members of this action committee are

Vancouver mayor Jack Volrich.... He's the mayor of Vancouver; no

further comment about that. It might be an appropriate thing to do — somebody

from city council in any event. Look who the other members of this action committee

are, reading from the article: Finance Minister Hugh Curtis — a Socred — Provincial

Secretary Evan Wolfe — another Socred, here by the grace of Gracie's Finger

and not by anything that he himself did, but that's another matter — and

Vancouver area MLAs Peter Hyndman, Vancouver South, Jack Davis, North Vancouver–Seymour,

and Angus Ree, North Vancouver-Capilano. It's interesting to note that of

the members of the committee, other than the chairman, the Minister of Environment,

none of the other Socred members of that committee who are supposed to be the

action element can be bothered to be in the House this morning to take

part

in any kind of debate. They're all in Public Accounts. Hugh Curtis, Evan

Wolfe, Peter Hyndman, Jack Davis and Angus Ree are all in Public Accounts, obviously.

MR. CHAIRMAN: Hon. member, at this point I would ask that if we continue to refer to the members we refer to them by riding.

MR. HOWARD: I'm reading from the publication.

MR. CHAIRMAN: That has been established, hon. member, but if we can maintain parliamentary precedent the Chair would appreciate it.

MR. HOWARD:

Well, all these people are members of this action committee. The point

I'm trying to make is that the action committee is a Social Credit

action committee designed to support a nightmarish-oriented dream of

the Premier, who out of desperation last spring had to find something

to attempt to rescue himself from the morass he found himself in. And

he got into that morass all by himself.

The objection that I

want to make to B.C. Place, apart from the fact that one could

speculate that the drafter of the legislation was Ian Sinclair himself,

was a point made by the second member for Vancouver East (Mr.

Macdonald) and the member for New Westminster (Mr. Cocke). Apart from

the fact that there is a complete fumbling and an inability on the part

of government to be able to get their hands on this particular thing —

they don't even know how to go about acquiring the property and so on

apart from the wide open, limitless borrowing powers that are being

sought in here without any further reference whatever to the

Legislative Assembly, and apart from not asking anybody else in the

province whether or not they agree to pay for this particular monument,

I have an objection to it on the basis that people from the north are

the ones who pay far more heavily proportionately for monuments and

programs such as this in the lower mainland. People from the Okanagan,

the Peace River, the Kootenays, other parts of the interior, Vancouver

Island and all over this province are the ones who are being asked to

put up the dollars to support this, which is nothing more than a

monument to one individual so desperate that he would grasp at anything

to try to ensure he's retained in office as the Premier.

Those reasons are adequate enough for me to indicate absolute opposition to this particular concept.

[ Page 4061 ]

HON. MR. ROGERS:

If I could start with the member for Skeena's comments first, 46

percent of the people who currently attend events at the Empire Stadium

are from outside of the lower mainland or the city of Vancouver.

Statistics in the Seattle area are even greater for people from all of

Washington state and from British Columbia who attend events within

their major metropolitan stadium. Certainly if a stadium is going to

exist anywhere it has to exist in the major centre. But to expect that

it's only for people who are from the lower mainland area or from the

immediate vicinity is totally incorrect. There's not sufficient

capacity in terms of population in those areas to justify....

Interjection.

HON. MR. ROGERS:

I appreciate that the member meant that people from the interior part

of the province are going to pay for this, just as much as people from

the metropolitan areas pay for some of the privileges that you have in

your areas of the province.

There are three Crown

corporations which have no limits to their borrowing power. Their names

should not be particularly strange to you. They are the British

Columbia Petroleum Corporation, British Columbia Cellulose Corporation

and the Insurance Corporation of British Columbia. So while you bemoan

this particular corporation for having no limit to their borrowing

power, one might reflect back on Crown corporations which were put in

place by another government.

Interjection.

HON. MR. ROGERS:

I'm glad that the second member for Vancouver East is back now. You

asked about the 200 acres. If you'd just take a tiny bit of time to

look at it, not all the property involved in B.C. Place is owned by

Marathon. Some of it is owned by B.C. Hydro, and that will also be

acquired for it.

Interjection.

HON. MR. ROGERS: No, we're not going to expropriate that. We don't think that'll be necessary.

You

asked about the expropriation. I might say that we don't intend to

expropriate the CPR lands. As I have explained publicly, there may be a

necessity to expropriate small pieces of property in terms of access to

the site, and there also may be a necessity to expropriate leases oil

the site once the site has been acquired by British Columbia Place.

The

member for New Westminster mentioned the fact that the CPR is not easy

to deal with. I don't think that's a revelation that anyone in this

House is going to find particularly new. However, we had agreement in

principle to swap like land for like land on appraised value before we

went into this deal. I might add that Marathon approached the

government, rather than the government approaching Marathon in the

first place. It was originally their proposal to come to see us.

Interjections.

HON. MR. ROGERS:

I'll tell you what: I'm going to speak to people in Fish and Wildlife

and see if we can't get a couple of dozen crows so that when the final

analysis of what, we pay for this property and what the negotiations

are are made public, I'll be able to supply them for people who want to

eat a little crow. We'll be able to Supply some crows, because I'm

quite confident that....

You commented on the action

committee and their absence here, but I'll tell you that they were not

absent when we were involved in selecting the people who are the

chairman and board of directors of this corporation. They have been

spearheading the development to this date and, in addition to that, the

negotiations with Marathon. I can tell you that there is a

cross-section of people from throughout British Columbia who have been

involved as board members of British Columbia Place. They've been the

ones who have spearheaded the negotiations. When the final analysis is

done I think that all British Columbians will be very proud of the work

that they have done on this very worthwhile project.

I move second reading.

[Mr. Davidson in the chair.]

Motion approved on the following division:

YEAS — 26

Waterland

Nielsen

Chabot

McClelland

Rogers

Smith

Heinrich

Hewitt

Jordan

Vander Zalm

Ritchie

Ree

Wolfe

McCarthy

Williams

Gardom

Curtis

Phillips

McGeer

Fraser

Mair

Davis

Strachan

Segarty

Mussallem

Hyndman

NAYS — 15

Macdonald

Howard

Stupich

Dailly

Cocke

Nicolson

Sanford

Gabelmann

Skelly

Barnes

Brown

Barber

Hanson

Mitchell

Passarell

Division ordered to be recorded in the Journals of the House.

Bill

46, British Columbia Place Act. read a second time and referred to a

committee of the Whole House for consideration at the next sitting of

the House after today.

HON. MR. GARDOM: Second reading of Bill 62, Mr. Speaker.

MINERAL AMENDMENT ACT. 1980

HON. MR. McCLELLAND:

Mr. Speaker, this is basically a housekeeping amendment to the Mineral

Act. There has been some question in the Attorney-General's ministry

for some time that the reserves which were put on regarding the staking

of mineral claims may not have been fully covered in law. We're

ensuring that that's the case at the present time: we're increasing the

number of units of claims which can be held together — from 40 to 100

so that you could have 5 units of 20.

[ Page 4062 ]

The

final amendment is to facilitate complaints which now must be dealt

with personally by the minister. The number of activities in place at

the present time regarding mining activity in the province has created

a serious backlog over the last year or year and a half. In the past

those claims were always held by the gold commissioner himself; that

was always well accepted by the mining community. We're suggesting a

return to the old method of hearing appeals in order to not only

facilitate those which are waiting to be heard at the present time but

also to facilitate hearing future appeals so that people don't have to

wait for months in order to have their concerns heard.

MR. HOWARD:

The examination that the members of the official opposition have made

with respect to this bill substantially confirms that the minister has

outlined it in reasonably accurate terms — that's quite a concession to

make! There are some complexities in it which can be dealt with more

appropriately at the committee stage, which is what we will be doing on

another occasion.

HON. MR. McCLELLAND: Mr. Speaker, I move second reading.

Motion approved.

Bill

62, Mineral Amendment Act, 1980, read a second time and referred to a

Committee of the Whole House for consideration at the next sitting of

the House after today.

HON. MR. GARDOM: Second reading of Bill 52, Mr. Speaker.

UTILITIES COMMISSION ACT

HON. MR. McCLELLAND:

Mr. Speaker, at the outset in introducing second reading of this bill,

the Utilities Commission Act, I would say that in preparing it for

presentation to the Legislature we had a choice of putting in

amendments to the Energy Act or coming forward with a new act. It was

the advice of various officials in my ministry and in the Ministry of

the Attorney-General that, since there were such major principles

involved, it would probably be appropriate to bring forth a new bill.

In so doing the large majority of the sections included in this rather

large bill are simply sections which have been moved over from the

Energy Act to the Utilities Commission Act. Changes to some of those

sections may be necessary sometime in the future, but at this point the

urgency was to get a new commission in place and make the opportunity

for full regulation of B.C. Hydro and the review of major energy

projects in the province as quickly as we possibly could. We felt it

had to be done this session, so many of the questions which may be

raised on other sections of this bill, which are being left intact,

have not been addressed at this time. That may happen sometime in the

future.

Mr. Speaker, I'd like to point out that last

February the government put forward in its energy policy statement a

framework within which this province might build an energy-secure

province. We identified the government's role of energy stewardship and

we outlined some of the directions we would take in fulfilling our

energy mandate. Since that time we have taken a number of steps to

implement various elements of this energy policy — steps, in fact,

towards energy security.

Energy-demand forecasts are now

prepared annually by the ministry to allow energy policy to be based on

up-to-date and accurate information. The Energy Development Agency has

been formed, with $10 million budgeted for this year, to initiate

research and development of the energy technology of the future.

Studies to develop electrical generation from thermal coal, coal and

wood waste, geothermal activity, the sun and the wind have been started.

Proposals

to establish a secure supply of energy at a fair price to all British

Columbians have been put forward. An example is the Vancouver Island

natural gas pipeline. We hope the rural gasification program — a matter

which I mentioned during debate on my estimates — will come forward

soon. There is active encouragement of coal development in various

parts of the province. A review of natural gas pricing, both in the

field and at the wholesale level, has been ordered and will be started

by the Utilities Commission next month. A pricing policy for industrial

and processing applications of natural gas has been developed a pricing

policy, I might say, which ensures that British Columbians get the best

value for the use of a depleting resource.

Programs to

encourage energy conservation in all sectors have been continued and

developed — the B.C. Energy Bus Program and Operation Tune-up, to name

a couple. A joint energy resources strategy committee has been formed

with the province of Alberta to ensure that our two provinces may

participate in the orderly development and marketing of our energy

resources.

The energy field is very broad and multifaceted.

There are many areas still to be addressed, many initiatives yet to be

undertaken, and many issues of ongoing concern. The legislation we have

introduced today, Bill 52, provides some of the tools with which the

government, in consultation with the people of this province, may

attend to these matters and manage our energy future in an effective

and responsible manner.

[Ms. Sanford in the chair.]

The highlights of the

legislation are as follows: the British Columbia Utilities Commission

is created and replaces the B.C. Energy Commission in its regulatory

functions. The B.C. Hydro and Power Authority is brought under public

regulatory control for the first time in its history since it was

established in 1964. The major projects review process, promised in the

government's energy policy statement, is created. Public hearings under

the review process will be administered by the Utilities Commission,

but will be separate from its regulatory function. The government is

given authority to issue energy-removal certificates for energy

supplies deemed surplus to provincial needs. The cabinet is vested with

the clear responsibility for energy policy in British Columbia.

I'll

just take a moment to expand on a couple of these points. As I've said,

the B.C. Utilities Commission will take over from the Energy Commission

the role of rate regulation. This role will be expanded to include the

regulation of B.C. Hydro rates. Proposed rate increases will be subject

to hearings before the Utilities Commission. These hearings will ensure

a rate structure for energy that is fair to all and consistent with

overall government energy policy. In addition, the Utilities Commission

will take on the regulation of services and additions to facilities of

all energy utilities in the

[ Page 4063 ]

province,

including B.C. Hydro. In this role the commission can help to ensure

secure and continuous supplies of energy to all British Columbians.

Apart

from that, the key feature of the new legislation is the establishment

of the streamlined review process for major energy generation and use

projects in B.C. The legislation requires that all major energy

projects be submitted for review. The term "major energy projects" is

carefully defined in the bill to include all new projects, as well as

all additions to current facilities which will generate or use a

significant amount of energy. The legislation also provides that any

energy undertaking, of whatever size, if it is deemed by the minister

or by cabinet to be of significant impact. may also, despite that it

does not reach the size requirements in the act, be made subject to the

review process.

Madam Speaker, the Minister of Environment

will play a major role in developing both the criteria and the terms of

reference for review projects. It will only be on the joint

recommendation of the Minister of Environment and the Minister of

Energy, Mines and Petroleum Resources that projects will be considered

for review.

In addition to one or more permanent utilities

commissioners on the panels for review, it may also include a number of

temporary commissioners selected, we believe. for their particular

expertise or interest in the matter at hand, or perhaps for the

particular region of the province which they may represent, because we

feel it's important that these review panels be representative not only

of Victoria or Vancouver but of the area in which the project itself

will have the most general impact. The manner of setting up separate

review project panels will allow us the utmost flexibility in dealing

with these matters to the best benefit of the local community. The

public hearings will canvass as wide a range of public opinion as

possible in each case. Using the base of information gained through the

hearings, the commission can then provide its report and

recommendations to cabinet on the merits of the project application.

Ultimately the decision to issue energy project and operation

certificates will rest with the government.

The utilities

commission legislation also provides for the regulation or review of

energy removals from this province for the first time. Energy removal

certificates issued through procedures similar to those I have

described for the project and operation certificates will be required

for all energy leaving this province. Exemptions are provided for

contracts already in force — export licences and other things like that

— which have been issued by the National Energy Board prior to this

legislation, and anything else which is already in place.

The

significance of the legislation's provision for the energy review

process is that it gives the general public direct access to energy

decisions for the first time ever. It allows all the arguments for or

against a given project to be brought forward in public for full

consideration. Conversely, it gives the government a means of

consulting the people of this province and other interested parties on

energy generation and use projects, so that in developing our energy

resources we do not compromise other less tangible resources such as

the quality of life in British Columbia — the integrity of our

environment. Perhaps most important, it gives the government the means

to ensure that energy development and use is addressed in a

comprehensive manner, taking into account all the costs and benefits of

any project and making sure that it meets both the short- and

longer-term needs of British

Columbia. We

have realized that energy development and use cannot be separated in

what we intend to be a truly comprehensive energy policy. Since the

export of energy may also be considered an energy use. the provision

that I've spoken of earlier bears a similar significance in any kind of

comprehensive policy.

In summation, the Utilities Commission

Act will provide a mechanism of streamlined public review of energy

projects which gives both industry and the general public their full

opportunity for participation, sets up a panel of experts who will

assimilate that information, compile reports and make recommendations.

and provides the government with the means to make informed policy

decisions on energy development and use.

The final

responsibility for such far-reaching decisions must lie with the

government. which is accountable to this Legislature and. ultimately,

through this Legislature to the people of British Columbia. We are

indeed entering a new era of energy management in British Columbia. The

government has an energy policy now in place and is bringing that

policy into effect as quickly as possible. With this new legislation,

we will be better able to fulfil our mandate of energy stewardship,

fully aware of the responsibilities of that role, and work with the

people of British Columbia towards our ultimate goal of energy security.

With those remarks. Madam Speaker. I move second reading of Bill 52.

MR. SKELLY:

The opposition intends to oppose Bill 52 for a number of reasons which

I'd like to outline for the Legislature. Unfortunately, for personal

reasons our energy critic cannot be here, but he has asked me to deal

with some of these issues as the bill comes on the floor.

response to the minister. Madam Speaker. the first thing about this

bill that struck us when our research staff and our critics took a look

at it was that it lacked any originality whatsoever; it lacked any

justification for the fanfare that was given it by the Social Credit

government — as in the so-called energy policy that was brought down in

February. There is really nothing new in this legislation to justify

the fanfare that brought it in in the first place. We checked through

the bill

section by section, of course, as we always do, and out of the

159 sections we found roughly a dozen new ones. Those dozen new

sections give to the government roughly the same powers they already

had under existing legislation which gives cabinet authority to do the

things that this bill gives cabinet the authority to do.

The

only people who lose in this legislation — as far as we can determine —

are those citizens of the province of British Columbia who are

concerned about energy project developments. concerned about the

operation of energy projects, and who, having looked at this

legislation, find no additional vehicle for the expression of public

concern into government circles. They have another hoop that they have

to jump through- that is, through the Utilities Commission. As

everybody can see both from the wording of this bill and from the

interpretation of this bill by lawyers throughout the country who are

expert in regulatory law, there is no additional, effective voice for

the public in this critical area of energy project approval.

Prior

to the passage of this bill and the time that this bill is implemented.

anyone who was concerned, for example, about a hydroelectric dam, could

have contacted the comptroller of water rights, appeal to the

comptroller of water

[ Page 4064 ]

rights,

and a hearing would be held. There was a set procedure for calling and

examining witnesses, and at least they could have some kind of public

voice on how water was to be allocated to the project, which was

critical to the project going ahead. That is no longer possible, from

what I understand, under this statute, nor is an appeal under the water

licence possible. So one avenue of citizen appeal, Madam Speaker, has

been cut off under this new

section of the Energy Act.

Also,

citizens affected by the effluents or by the emissions from a thermal

plant could appear at a Pollution Control Board hearing, and could

outline their opposition to the effluent and emissions of a thermal

plant. Now that avenue of public hearing for the citizens has been cut

off, as far as we can see from this act. The avenue of appeal has been

cut off as well. So all of those powers that the citizens had prior to

the bringing in of this act — an appeal to the Pollution Control Board,

a further appeal to cabinet, an appeal to the comptroller of water

rights and a further appeal beyond him to a cabinet committee — have

been wiped out in a single stroke.

Citizen opposition has

now been focused on this so-called public utilities commission or B.C.

Utilities Commission, and only in this one forum will citizens have the

right to express their concern about large energy generation and

transmission projects. But it's a body, Madam Speaker, that is totally

the creature of cabinet. In fact, under the old Energy Act the

legislation said that the commission could do nothing unless it was

referred to it by cabinet. This statute takes two sections to direct

the new Utilities Commission. In the first

section they say the

Utilities Commission shall do nothing unless cabinet tells it to do

whatever it wants it to do.

Furthermore, anything that the

commission does after public hearings, after making recommendations and

reporting to cabinet....Cabinet simply doesn't have to follow the

report and the recommendations of the Utilities Commission. Those could

be thrown out and a second voice could come in behind the curtain — the

voice of B.C. Hydro, Noranda or Westcoast Transmission. Any of those

energy utilities in the province could come in behind the curtain of

cabinet and have their way impressed on cabinet and receive a project

certificate and an operating certificate in spite of what went on

before the public utilities commission — the reason for this being that

the commission is absolutely powerless. This legislation emasculates

any public utilities commission as we know it. There really is no

commission; it's simply another bureaucratic hoop that citizens and

utility companies have to jump through in order to get cabinet

approvals which cabinet already has the power to give.

really, Madam Speaker, there is nothing original in this energy bill,

nothing to justify the fanfare with which it was presented in this

Legislature and through the energy policy — or what stands for an

energy policy — when this government brought it in last February.

When

you look at utility commissions that have been established in other

areas of North America, for example in California, those states see the

commission as an effective instrument of public policy. Behind that

public policy and behind the commission stands a commitment on the part

of some of those states to use energy more efficiently, and another

commitment: to allow citizens greater and more effective voice in

energy decisions that are being made within their jurisdiction. There

is none of that here. Really there is no energy policy in this

province. This legislation doesn't spell out the energy policy terms

under which this commission is to make its decisions, recommendations

and reports. None of that is spelled out in this legislation. Basically

they're still operating in a policy vacuum.

In the state of

California, if a utility comes before the California Utilities

Commission asking, for example, to build a huge oil-fired thermal

generating station, the California Utilities Commission must, because

of its instructions from the government, ask that utility what

alternatives they have sought to this expensive form of generation. The

utility must then reply to the commission that they've exhausted all

other alternatives, including energy conservation and making their

customers' homes and businesses more energy efficient; then the

commission can allow them to build a new oil-fired generating plant.

But most of those utilities in the state of California have found that

it's much cheaper for them to get involved in energy efficiency than it

is to build new plants. As a result, when I was visiting the area a few

weeks ago, something like 3,000 megawatts of new generating facilities

had been cancelled or delayed because Californians are using energy

more efficiently. One of the reasons for that is that the Utilities

Commission in California is seen by the government as an independent,

effective instrument of government policy that can demand alternative

ways of producing power or saving power from the utilities that come

before it seeking project development certificates.

There is

nothing like that in the 12 new sections of this act that provide for

energy project certificates and operating certificates. This is a

disastrous act for the province of British Columbia. When we look at

the amount of cabinet discretion that has been placed in legislation in

this Legislature over the past five or six months it's frightening.

Every day in this Legislature we see the power of citizen input in

government decisions eroded to the point where it's almost no longer

existent, particularly in the energy field. A citizen has virtually no

power to effectively suggest to the government what energy projects

they want and what energy projects they don't want. If you canvass the

citizens of this province and ask them if they would like to have the

province more energy efficient, using less energy to do more work, I

guarantee you that you'd get almost 100 percent favourable response.

Yet the government hasn't seen fit to canvass the citizens of the

province.

[Mr. Davidson in the chair.]

Obviously

they consulted with B.C. Hydro and some of the private utilities around

the province before drafting this legislation. Whatever they say, Hydro

must be ecstatic at the presentation of this bill. Certainly they have

to jump through an additional hoop to get their pricing policy

established, but they're willing to do that in any case. But in the key

sections, in the consequential amendments, it points out that Hydro

doesn't have to go to the B.C. Utilities Commission to have its debt

examined or any additional ways of raising capital examined — except

that it must come through the Legislature.

When the minister

makes a statement and he's poorly informed as to Hydro's borrowing

requirements, we have to accept his word as to what Hydro's

requirements are — and they're very poorly stated, not very specific.

It can be predicted that the Legislature will vote an increase in

Hydro's borrowing bill or a ceiling on Hydro's borrowing almost year

after year. That doesn't say where Hydro's going to borrow the money or

whether they're going to take it out of civil

[ Page 4065 ]

servants'

pensions at below market rate to the point where we have to consider

alternate means of funding those pension plans because we're robbing

from them to subsidize utilities. Certainly Hydro would prefer to have

their borrowing authority debated in this Legislature where there's a

government majority and where the willingness appears to be here on the

part of the government to steal from those pension plans to subsidize

B.C. Hydro.

Why isn't the Utilities Commission given the

jurisdiction to examine Hydro's borrowing requirements and to decide

whether they are appropriate to energy planning for the province in the

future? That should have been included in this legislation, and it

isn't. How is the Utilities Commission going to make any pricing

decisions with respect to B.C. Hydro without considering Hydro's

borrowing requirements and the revenue required to pay back those loans

that Hydro can obtain in the New York markets, or out of provincial

service pension plans, or out of the low market rate borrowings from

Canada pension plans? That jurisdiction should have been given to the

Utilities Commission.

All of the power in this bill really

devolves back onto the cabinet. The commission is simply a creature of

cabinet and all it does is create another bureaucratic hoop.

Information was put forward at public hearings on behalf of utilities

and by citizens who are concerned about those environmental projects

such as Site C, the Cheekye-Dunsmuir power line, the Hat Creek

development, and the Stikine development. These are going ahead in

spite of the legislation coming down. In spite of all of those things

the citizens are really going to have no more effective public voice in

the energy decisions than they've had in the past. Cabinet is going to

be the one to decide. All we'll have is this little extra bureaucratic

hoop to jump through before getting to the final decision-maker, which

is cabinet. But the one thing cabinet has seen fit to do here is to

eliminate the appeal procedures under the Water Act and the Pollution

Control Act. So there is virtually no appeal now from a cabinet

decision.

All of those peop

Spooky…

le, Mr. Chairman, who were

looking forward to this legislation to provide them with a better, more

effective avenue of citizen input to government energy decisions now

find that they've been totally cut out. Government seems to have the

attitude that those who are concerned about energy and those who are

concerned about the environment are a bunch of long-haired,

raggedy-clothed hippies. That's simply not the case. The people who are

concerned about energy today are the people who, for example, are

paying the price of the Columbia River development, either through

having their land flooded and lost forever in the Kootenays.... On the

MacGregor diversion proposal. people who saw that thousands upon

thousands of acres of timber would be put under water.... We think of

Hydro as a renewable resource, yet it's not a renewable resource. In

spite of what you read in the throne speech. The land under which you

store that water can never be replaced to its previous productiveness.

Hydro is not a renewable resource. It may be partly, but it's not to be

considered a renewable resource.

All of these people who are

concerned about energy projects are not wild-eyed hippies. They are

people who have lost significantly as a result of the activities of

this government and its instrument, B.C. Hydro, in the past. They are

paying on their electricity bills for the privilege of that loss, and

they're being told that they're going to have to sacrifice further the

lands and natural resources of this province in order to justify

Hydro's expansion. Nothing we can see in this bill is going to stop

that or give the citizens any more public input than they've had in the

past into attempting to put a stop to it through citizen action.

It's

interesting right now that people who have not had the opportunity of a

sufficient public hearing are now demonstrating on Texada Island to try

to stop a right-of-way clearing project for the new 500-kilovolt

Cheekye-Dunsmuir power line. I gather seven of them have already been

taken off to jail, thanks to this government's decision not to give

those citizens adequate public input.

Under the linear

guidelines that the government brought down to cover developments such

as power lines, highways, pipelines and those kinds of things, a public

hearing was a requirement. The principal was required to hold a public

hearing. In this case the government exempted him from the public

hearing.

Also under the linear guidelines a proponent for a

project is required to do an economic cost-benefit study to show how

the costs and benefits are distributed throughout the province, not

simply within the corporation. Hydro did a study to show the costs and

benefits to the corporation. Cabinet accepted it, even though it

violated the requirements under the linear guidelines.

Again,

you go back to cabinet decisions. There is no change now under this

legislation from what previously applied. Cabinet still has the right

to set out the terms of reference to the public utilities commission.

As cabinet sees fit they can still abridge the guidelines in order to

justify one project going ahead or to cancel the project.

[Mr. Strachan in the chair.]

The

Utilities Commission has virtually no power except as a servant to

cabinet. Their decisions aren't written down; their recommendations

aren't written down; there's no obligation that that be made available

to the public. So the public isn't any better informed now than they

were in the past, when energy matters were totally under the

jurisdiction of cabinet. Nothing has changed.

If this is

supposed to be the brilliant new legislation that's going to govern the

development of energy in the province of British Columbia. It's really

a piece of garbage, and the minister should admit it. There is nothing

whatsoever that's new in this legislation.

Why, couldn't we

have a statement of policy written into legislation which would be a

guide to the Utilities Commission in making their recommendations? Why

was it left in the hands of the minister to make up policy as he goes

along? If the minister wants the Site C dam to proceed, he will set out

the terms of reference to the Utilities Commission in such a way that

that dam is going to go ahead. We know he wants that dam to go

ahead.

If he wants the Hat Creek thermal project to go ahead. he,

in consultation with the Minister of Environment (Hon. Mr. Rogers),

will simply prescribe terms of reference to the Utilities Commission,

chaired by a political hack — whom he appointed — with no previous

experience in energy matters; her only experience, the thing that got

her the job, was that she was the daughter of a former Social Credit

MLA. What the minister can do is prescribe terms of reference to his

political hack on the commission; as a result, if they want Hat Creek

thermal. they're going to get Hat Creek thermal.

It's a cruel 'joke on the citizens of this province, Mr.

[ Page 4066 ]

Speaker.

Really what we're doing, within the Social Credit Party cabinet and

through Social Credit Party hacks, is making it appear that the public

has better protection from the discretionary activities of government

than they've had in the past. That is simply not the fact that is

brought out in this legislation.

Our

caucus intends to oppose this legislation because it does nothing to

further improved and effective public input into energy decisions in

British Columbia.

MR. DAVIS: Mr. Speaker, I will be

supporting Bill 52. I support its general objectives. Some of its

details, however, bother me, so I intend to speak again at the

committee stage, however briefly. I'll then be putting forward

recommendations to the Minister of Energy, Mines and Petroleum

Resources which, if implemented, will improve the legislation

considerably. At least that's my view.

Essentially Bill 52

has two parts: one deals with the regulatory functions of a new public

utilities commission; the other describes a project review process that

reaches out even farther into the private sector. It is new in the

sense that we haven't had this kind of legislation in B.C. before. It

deals with energy- intensive industries, whether they are regulated

monopolies or not.

This project review process will, I hope,

simplify things for companies and agencies that want to build large

power dams, pipelines, smelters and chemical plants in British

Columbia. The energy review process will apply to regulated and

non-regulated entities alike; it will apply to public sector

corporations like B.C. Hydro as well as private sector companies like

Inland Natural Gas and the Aluminum Company of Canada. It's also

innovative, in the sense that it tidies up the approval process. It

amounts to a single desk stop insofar as government permits are

concerned. Hearings will be held more often than not, but when they are

over and the commission has made its recommendations, the developer

will get its licences and permits all at the same time. Delays will be

minimized in this way and uncertainty reduced. The discussions, the

debate and the arguments will be focused. The public will be better

informed, certainly, than they have been traditionally in B.C.

Ministers, who have to get elected, will make the final decision as to

whether or not a project goes ahead. They will do so, however, after

the project in question has been studied and has been debated in a

public forum dealing with all of the aspects of a major energy

development. In other words, it will be a review process that is not

only new in B.C. but that can be thorough and may well be precedent-

setting in Canada.

With our new energy project review

process in place the applicant will start with ministers and end with

ministers — the Minister of Energy, Mines and Petroleum Resources and

the Minister of Environment for B.C. The timetable will be set. A

commission panel will be appointed. Interested parties will have a

chance to be heard. Officials from relevant ministries will make their

input as well. Recommendations will be made within a span of six months

or a year. Then it will be go or no go, with the final decision being

made at cabinet level.

This, in my view, is responsible

government at its best. True, each applicant still has to touch all on

the same basis that they do now. Officialdom has to meet the applicant

halfway, essentially in the commission's offices, and in the public

forum which a panel of the commission will provide. A critical path

still has to be followed. But with this energy project review process

in place it is an obstacle course of known dimensions, Mr. Speaker. It

will result in a decision one way or another in a reasonable period of

time, and those concerned with social and environmental impacts will

have a say in the outcome, whatever that may be.

So far I've

been praising the bill, and in general I praise the government and the

minister for introducing it. I think the energy review process in

particular is a good idea. It's a sound idea. It will speed up and

clean up the process whereby large new developments on the energy front

are authorized. But we must also be practical, and I hope the practice,

in this case, will suit that definition. No one is going to spend large

sums of money — sometimes many hundreds of millions of dollars —

building a new project when they can't be sure they'll receive a permit

to operate it once its construction is complete. Obviously the project

review process, insofar as project operations are concerned, must be

linked with the construction phase. Operating procedures must be

cleared at the same time that the building permits are issued. They are

all of a piece; when it comes to financing, you can't have one without

the other. All objections must be met and the way cleared through to

the production phase before, a new-project review process can be said

to be complete.

We're dealing, essentially, with big

projects, Mr. Speaker, energy- intensive projects, expensive projects,

projects which could be damaging to the environment unless they are

built and operated in the right way. Bill 52 mentions three PJ of

energy as the cutoff point. That means development on the electrical

side of 100,000 kilowatts or more; it means pipelines carrying three

billion cubic feet of natural gas or more; it means refineries capable

of processing 500,000 barrels of oil a year, for example. It would

include an industry using 250,000 tonnes of coal per annum. Perhaps the

line should be drawn a bit higher, at five PJ, for example, but it is

of the right order of magnitude. Projects producing or consuming energy

in these quantities are big projects in anyone's eyes. They can't go

ahead without the government issuing various permits in any case. For

the rest of us and for their proponents, the new project review process

therefore makes a lot of sense. It makes sense for reasons of scale and

it makes sense administratively as well.

There are other

size cutoffs in Bill 52 and some of these give me a little trouble.

Anything over 20 megawatts is to be fully regulated if it is a hydro

power plant, a fuel-burning powerplant, or an addition to an existing

powerplant of more than 20-megawatt capacity. These are small units. A

single prime mover in a multi-unit compressor station on a natural gas

pipeline is 20 megawatts today. Does this mean that any industry which

wants to build a small generating station runs the risk of becoming a

regulated utility in future in this province'? Does it mean that a

mining company that wants to put in a small dam and produce its own

power will have to go first to the minister, then to the public

utilities commission, and back again? We're talking about power

installations with an energy — producing capability equivalent to that

of a small jet engine in a small executive jet. I don't think small

installations like this should be caught up automatically in the

project review process. I certainly don't think they should become

regulated projects in the sense that their costs must be examined and

their rates set by a regulatory commission here in B.C.

Still

on the question of size, I personally would eliminate the clause which

includes as a regulated project: "an undertaking of any kind that the

Lieutenant-Governor- in-Council

[ Page 4067 ]

designates

to be significant in the matter of energy. " What does that mean? It

could be any size whatsoever. It could produce steam rather than

electricity. It could burn wastewood or garbage, for that matter. These

are sweeping powers. In my view, especially in this area of size, they

cover too much ground. I therefore think Bill 52 goes too far, at least

in the definition of size. It goes down to projects which are small and

medium sized and shouldn't be included in legislation of this kind. It

shouldn't be phrased in such a way as to cover all energy-producing and

energy-consuming activities regardless of their size and regardless of

the way in which they impact on the area in which they are located.

When it comes to power plants — hydroelectric and thermal — I would put

the figure at 100 megawatts. That's in line with the minimum cutoff

figure for the project review process. If it's not 100 megawatts, then

it should be 50 megawatts for regulatory purposes. That's small enough,

as far as I am concerned.

Hon. members and Mr. Speaker should be clear about one thing: we're not

just talking in this legislation about projects which produce energy or which

simply transport energy; we're talking about plants which use energy as

well. Bill 52 goes beyond the production and transportation of energy; it reaches

out from the supply side into the energy demand side, the energy use side. When

it comes to a matter of scale, it treats consumers of energy and suppliers of

energy alike. It includes "energy use projects" such as — and I'm

quoting again from the bill — "a mill, factory, plant. smelter, oil refinery,

metal refinery or other undertaking designed to use, convert or process energy

at a rate of 3 or more a year" — same cutoff point, same sizes.

But

now we're on the demand side of the ledger, the use side — we're

talking about using energy, not producing it, and delivering it to

consumers in B.C. That's really new, Mr. Speaker. The Minister

of Energy, Mines and Petroleum Resources will now become more than a

minister responsible for supplying raw and semi-processed energy to our

economy he will also be moving into the forest and mineral resource

processing category in a big way. Not only does the energy project

review process cover Alcan's expansion, but that of our larger pulp and

paper mills as well. B.C.'s Energy minister will in future be the

minister responsible for the construction — and clearing of the

operation — of large plants producing petrochemicals and

electrochemicals. He will have a big say in the manufacture of

fertilizers and of by-products from coal, oil and natural gas.

Energy trans-shipment terminals and storage facilities are also listed in this

legislation. If a coal stockpile is large enough, it could conceivably be affected

by this bill; certainly a major port installation would be. Clearly, British

Columbia's Minister of Energy, Mines and Petroleum Resources will have a

considerable influence on the province's industrial development in the 1980s.

He, together with the Minister of Environment, will be the real minister of

industry insofar as resource development is concerned. This may be all to the

good, but I must point out that no other province has given its Energy minister

such sweeping powers over its resource processing activities. Few jurisdictions

anywhere have brought energy-use industries into their regulatory framework

to the extent we will be by passing Bill 52 in this House. This is the main

reason why I would like Bill 52 to be more explicit on the energy use side.

We must confine our project review and regulatory activities to genuine energy-intensive

projects. We musn't include small-and medium-sized energy using industries

in this regulatory framework in this highly bureaucratized procedure which should

be limited to major developments with important economic and environmental consequences

for us all.

Let

me move on to co-generation. Mr. Speaker. Industries that use a lot of

fuel an power should be encouraged to produce as much of their own

requirements as possible. This is true particularly of firms that

generate vast quantities of wood wastes, mine tailings, etc. If these

wastes are combustible and can be burned cleanly, then they should be

put to use. This bill doesn't help. In my view. It hurts the economics

of co-generation by limiting an industry's sale of surplus energy to 15

percent of its own annual consumption. How? If the plant sells more

than 15 percent of its energy output it will automatically become a

regulated utility under this act. I personally think that the figure 15

percent is too low. It should be more like 50 percent. Then an industry

that wants to use its own wastes for energy-producing purposes can

build for the future. It can overbuild with other plant expansion in

mind and can sell up to half of its output of steam or electricity

without being caught up in the kind of red tape that is usually

encountered by applicants who have to go before a public utilities

commission whenever they want to change their prices or add new

equipment to their plant.

I think I know what the hon.

Minister of Energy, Mines and Petroleum Resources will say in this

connection. He will say that this industry can sell any amount of its

by-product energy to B.C. Hydro. But that's not the point. B, C. Hydro

is like Big Brother. It's everywhere and it can set any price it wants.

So our beleaguered industry should be free to sell its surplus energy

to another firm nearby. It should be free to supply electricity to

other companies in the area in which it is located. and not

automatically be classed as a regulated utility. Surely corporations

that produce energy primarily for their own purposes shouldn't have to

deal only with B.C. Hydro. A little competition is good for everyone,

and an industry that can produce energy from its waste products may be

doing us all a service. Why blanket it with red tape if it has some

surplus power to sell and that power can find a home in another

industry nearby?

I agree that an industry that sells energy

to homes and stores other than those of its own employees should be

classed as a utility. But I'm talking about industry-to-industry sales

and I'm talking about co-generation with surplus power crossing the

factory fence and being consumed in another factory or energy-intensive

operation in the same neighbourhood. Let us give the production of

energy from sources other than falling water and high-grade fuels a

chance also. It's never going to get off the ground. B.C. Hydro, with

its ever-present surpluses of generating plants and equipment can

refuse to pay the kind of price for power which our energy

self-sufficient firms or would-be energy self sufficient firms will

need in order to break even in their utilization of wood and other

wastes.

B.C. Hydro is big. It's the biggest corporation by a

country mile in western Canada. It's bigger by far than Esso Resources

Canada Ltd. In Calgary, Syncrude Canada Ltd., and Shell or PetroCanada.

Now it appears we're in the process of creating another large

government-owned corporation here in British Columbia. I refer to the

B.C. Petroleum Corporation. It will play a more important role on the

B.C. energy scene as a result of Bill 52.

Not only will the B.C. Petroleum Corporation continue in its monopoly role as a purchaser of natural gas in the field

[ Page 4068 ]

this province, but it will also be the sole seller of natural gas in

bulk to big energy-intensive industries. It will be more than a tax

gatherer — a phrase which some of us on this side of the House have

been fond of using in recent years. It will be a price negotiator. It

will buy large quantities of B.C. gas and sell large quantities to

gas-using industries of various kinds. It will interpose itself between

transporting utilities like Westcoast Transmission, Inland Natural Gas

Co. and the end-user industries. It will negotiate the price and other

conditions of sale of natural gas to petrochemical plants, smelters and

pulpmills. It will negotiate contracts, presumably in the public

interest, which vary from time to time and place to place. In other

words, the B.C. Petroleum Corporation will be another monopoly, a

government owned and sponsored monopoly, which deals with the private

sector on a case-by-case basis with the capture of a maximum resource

rent in mind.

Clearly the role of private enterprise in

British Columbia's resource processing sector is compromised by this

development. It's compromised not only by the establishment of the

government-owned B.C. Petroleum Corporation as the sole supplier of

natural gas in these industries, but also by the BCPC's case-by-case

approach to pricing. As a petrochemical, mineral processing, or major

forest products company, each of them is going to have to negotiate a

special contract with this Crown corporation that is directed by the

government of the day. It used to be that low-cost energy was seen as a

magnet for industry, a magnet with which to attract industry to this

country — certainly to upgrade our resources before they were sold on

the export markets of the world.

[Mr. Davidson in the chair.]

Alberta still does this,

using low utility rates and a guaranteed long-term source of supply of

energy as drawing cards. There, new energy-intensive industries can

also go directly to the field and buy gas from the producer in the

field — if they can get lower costs, lower-priced raw materials,

lower-priced energy in this way. But in British Columbia in the future,

if you're big, if you use natural gas to process raw materials here,

and if you want continuity of supply, you're going to have to go to the

B.C. Petroleum Corporation. It's going to be Mr. Big, the equivalent in

gas to B.C. Hydro in electricity, insofar as this vital raw material

and heat-source energy is concerned.

As I said before, I

would leave the sourcing of natural gas entirely to the private sector

and would require our utilities to carry it to its markets — both large

and small — on a common-carrier and otherwise regulated basis.

Frankly,

I'm worried. We haven't had a large energy-intensive resource — process

in g industry start up in this province for nearly a decade, Mr.

Speaker. True, Cominco is rebuilding part of its metal smelting and

refining operations at Trail. True, Alcan is thinking about building

new aluminum refining facilities in the Kitimat area. But we've had

nothing on the scale of the big petrochemical developments which have

taken place in Alberta or some of the electrochemical projects which

have been built in recent years in Quebec. We may think the world is

beating a path to our doorway — to our cheap, secure energy — but we

don't need to set up administrative barriers and government

corporations to protect our energy supply when established institutions

of a less interventionist nature exist in this country and, indeed, on

this continent — ones which can look after our best long-term interests

just as effectively, and in a more expeditious and private enterprise

way.

Some may say that British Columbia needs a Crown

corporation to head off PetroCan. Ottawa shouldn't be allowed to do

with its big Crown-owned corporation what B.C. with its B.C. Petroleum

Corporation could do for itself. This I regard as really a red herring,

Mr. Speaker. If we need government initiative in any of these areas,

let government go the private enterprise route. If it doesn't want to

allocate all the responsibility to the private sector, then the

government should take a 50 percent interest in the action: it should

put up half the equity; it should become a partner in the key

energy-producing and energy-intensive industries that will and should

process our resources here. If there's likely to be a big windfall

profit, the B.C. taxpayer should get in on the act. Let government

become a half-owner in some of these enterprises. Owning half the

action and stripping off half the profits in terms of corporate income

taxes, we as Canadians will automatically pick up 75 percent of the

profits in an operation of this kind. Foreign capital would then be

providing much of the know how. It would link us to firm markets

abroad; most important, from a Canadian self-image point of view, it

would make us owners and entrepreneurs in our own eyes: competitive at

home and abroad, and innovators and producers, often on a world scale.

looking through Bill 52. I note several references to the Minister of

Environment. His concurrence is necessary in order to refer an energy

project application to the Utilities Commission for review. His

concurrence is also required when a regulated project is declared

exempt from provisions of this act. Environmental considerations, in

other words, are given a high priority in the energy project review

process. A project is finally approved for construction and operation

when it clearly has the approval of the government, certainly of the

Minister of Energy, Mines and Petroleum Resources and also of the

Minister of Environment.

There's a great deal more to this

act, Mr. Speaker. There are, for example, the extensive powers of the

Utilities Commission as a regulatory body. Most of the clauses have

been taken word for word out of the B.C. energy commission act — NDP

legislation, dating back to 1974; in other words, it is being repeated

more or less verbatim in this bill. Those clauses are cumbersome.

Certainly those parts of the bill are cumbersome in places, and indeed

unworkable in others. Therefore those sections of the bill need

updating; they need a combing-out. There are parts of the regulatory

sections which should be rewritten in their entirety.

Let me

give you a few examples before closing, Mr. Speaker. "The powers given

to the commission by this Act apply...notwithstanding that the

subject matter about which the powers are exercisable is the subject

matter of an agreement or another Act....Another one, to quote:

"The commission is not bound to follow legal precedent. " A third

example: "No act or decision of the commission shall be questioned or

held invalid on the ground that no notice or insufficient notice has

been given to any person." A fourth quote: ''Nothing in, or done under,

the Municipal Act supersedes or impairs a power conferred on the

commission...or relieves a person of an obligation imposed by or under

this Act...

Section 112 (

l) reads:

"The

commission may take the steps and employ the persons it considers

necessary to enforce an order made by it, and, for that purpose, may

forcibly or

[ Page 4069 ]

otherwise enter on, seize and take possession of the whole or

any part of the business and the property of a public utility affected by the

order, together with the records, offices and facilities of the utility."

other words, don't become a regulated utility in British Columbia,

because you'll be exposed to all of those powers of the commission.

Part

4 of the act is also taken, in this instance, word for word out of the

B.C. Energy Commission act passed by the NDP in 1974. It effectively

regulates all aspects of the oil industry in British Columbia, at least

if it were enforced. It provides controls over quantities of oil and

petroleum products, and can allocate these quantities to any user. It

sets prices; it can even regulate hours of sale. It's a very extensive

regulatory

section 1n the bill, and I think that part of the bill

should be rewritten and condensed, and some of its more punitive

aspects should be removed. After all, Mr. Speaker, the federal

government, as a result of its legislation, now has very extensive

powers over the allocation of petroleum products across Canada and over

price-setting. It is interfering with the free market in petroleum

products to a very substantial extent, and I don't think we need to

duplicate all of those federal powers in this province. In other words,

I think that the parts of the bill which simply repeat most of the B.C.

Energy Commission act of 1974 need rewriting. Perhaps this can be done

at another session of this Legislature. I certainly hope so.

sum up, I think that the project review process, which is new and

precedent-setting, not only in this province but on this continent, is

good and perhaps even inspirational. I think with some changes as to

scale of projects which may or may or not fall under its provisions

it's an excellent part of the bill. The remainder of the bill. which is

substantially the old B.C. Energy Act. I think needs revision. and I

hope it will be revised in significant ways in the next year or two,

MRS. DAILLY: On behalf of the Hon. first member for Vancouver East (Mr. Barrett) I move adjournment of this debate until the next sitting.

Motion approved.

HON. MR. SMITH: May I have leave to make an introduction?

Leave granted.

HON. MR. SMITH:

Today I have pleasure in introducing the High Commissioner to Canada

from Zambia, Mr. Peter Zuze, along with his second secretary. Mr.

Chiyangi, who are here in the gallery. This is the country of Victoria

Falls. Lusaka and the Commonwealth conference. Mr. Zuze is a

Lieutenant-General in the armed forces of that country, has served in

the British air force and is a very, very charming-well-educated man.

He's here having a tour o Canada and it is his first visit to British

Columbia. I would ask the House to make him welcome.

Hon. Mr. Gardom moved adjournment of the House.

Motion approved.

The House adjourned at 12:09 p.m.

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