Two dams, one on the Peace River and one near Bute Inlet, are now under study by BC Hydro. Barry Penner, chair of the Energy Futures Institute, reads that as an admission. “For years, British Columbians have been told that we have an abundance of electricity to support widespread electrification of transportation, buildings and industry,” he said. His institute is a project of the not-for-profit Resource Works Society.
The provincial government announced that BC Hydro will look at the feasibility of the Site E project on the Peace River and the Homathko project near Bute Inlet. Preliminary BC Hydro estimates put their combined capacity at more than 1,600 megawatts, with annual output of roughly 6,000 to 7,500 gigawatt hours (GWh). Consulting the public and First Nations, getting permits and financing, and building them would likely take more than a decade.
Gas plants back on the table
The announcement followed another reversal by only a few weeks. BC Hydro told the BC Utilities Commission (BCUC) that it needed to drop plans to phase out gas-fired generation at the Island Generation facility in Campbell River and the McMahon Generating Station in Taylor. Together the two plants represent approximately 400 megawatts of dispatchable capacity. The utility also flagged a need for more dispatchable resources to cover winter peak demand by 2030.
Media coverage followed, and BC Hydro then issued a “clarification” saying it was not currently pursuing new natural gas peaking plants. It did not say how the peak-demand gap would be filled. Last week, at a BCUC workshop, it stated that there are few other options for reliably meeting future winter peaks.
The institute’s numbers
Penner argues that LNG is not the main story. “A significant portion of future electricity demand, which government is now scrambling to address, originates from BC Government policy itself,” he said.
The institute points to documents BC Hydro filed with the BCUC. In them, the utility estimated that applying the Zero Carbon Building Code and equipment standards limiting the sale of gas space and water heating, as the 2021 CleanBC Roadmap calls for, would add 10,300 GWh of annual demand by 2050. Electric vehicles could add another 6,150 GWh. That totals approximately 16,450 GWh a year, which the institute says is more than three Site C dams. Site C, a $16 billion project, can produce 5,100 GWh annually under normal water conditions. A dam at Site E is thought capable of 3,000 GWh.
Set that against BC Hydro’s updated February 2026 Reference Load Forecast, which projects demand from the oil and gas sector, LNG included, rising by approximately 7,800 GWh between 2025 and 2050. By the institute’s reckoning, the growth tied to CleanBC building and transportation electrification is more than twice that.
“If you want to know what is really straining the grid, follow the policy, not the export terminals,” Penner said.
Nuclear and a wider review
Penner also said the government claims it will weigh every supply option while having ruled out modern nuclear power. Ontario is pursuing nuclear, and a new federal nuclear energy strategy was released the day before the institute’s statement. He called for a broader review of the assumptions underlying provincial energy policy.
“Only a few years ago, government policy assumed that wind, solar, conservation measures and imports would be sufficient,” he said. “Today, BC Hydro is openly discussing new hydro dams, continued natural gas generation and more dispatchable capacity because reliability is ultimately non-negotiable.”
Penner sat in the BC Legislature for four terms from 1996 to 2012 and served as Minister of Environment, Minister of Aboriginal Relations and Attorney General. As environment minister he introduced the province’s first climate action plan, which included North America’s first revenue-neutral carbon tax. He became chair of the institute in December 2023.
