barrister & solicitor · that to my current knowledge the facts presented are true and...

1116-207 WEST HASTINGS STREET, VANCOUVER, BC, CANADA V6B 1H7

MATTHEW J. JACKSON Barrister & Solicitor

DIRECT LINE: 604-842-5221

EMAIL: [email protected]

February 18, 2020

Sent via efile on the BCUC Website

British Columbia Utilities Commission

Suite 410, 900 Howe Street

Vancouver, BC V6Z 2N3

ATTENTION: Mr. Patrick Wruck, Commission Secretary

Dear Sir:

Re: FortisBC Energy Inc. Revelstoke Propane Portfolio Cost Amalgamation

Application – BCUC Project No. 1599033

Filing of Evidence of Cornelius Suchy on behalf of Intervenor Canadian

Biomass Energy Research Ltd. (CBER)

In accordance with Order G-13-20 made on January 21, 2020 in this proceeding, I enclose the

evidence statement of Mr. Cornelius Suchy, submitted on behalf of Intervenor CBER, and

respectfully request that statement be filed as an exhibit in the proceedings.

If further information is required, please contact the undersigned.

Yours truly,

Matthew J. Jackson

Barrister & Solicitor

Legal Counsel for CBER

Enclosures

C1-4

Yvonne.Lapierre

Revelstoke Propane Portfolio Cost Amalgamation

1

Evidence of Cornelius Suchy

submitted on behalf of

Intervenor Canadian Biomass Energy Research Ltd.

regarding

FortisBC Energy Inc. Revelstoke Propane Portfolio Cost

Amalgamation Application – Project No. 1599033

1. I, Cornelius Suchy, CEO and operating mind of Canadian Biomass Energy Research ltd., affirm that I have prepared the evidence that follows objectively and to the best of my abilities, and that to my current knowledge the facts presented are true and accurate.

2. I am a physicist and energy engineer with 25 years of work experience in the field of sustainable energy. I have worked as a consulting engineer throughout BC and Canada. My clients include First Nations, universities, the BC Ministry of Energy, Natural Resources Canada, the National Research Council, the Canadian Council of the Ministers of Environment, and the International Renewable Energy Agency. Attached as Appendix D is my resumé.

3. I have lived in Revelstoke since 2002. As a long-time resident I am knowledgeable of the city, its current affairs and local politics, the local economy and business operations, energy systems and means of energy end use, and other local matters.

4. The following evidence is organized in three sections. Section A addresses economic considerations that would likely arise in the event of the Commission’s approval of a lower propane price for Revelstoke propane customers, by way of amalgamation with the natural gas price through a cross-subsidy by Fortis BC Energy Inc. (FEI) natural gas rate payers, as proposed by FEI in this proceeding. Section B addresses the likely impact of the proposed amalgamation of Revelstoke propane prices on GHG emissions for the City, in large part due to the economic considerations. Section C addresses the likely socio-economic impact of the proposed propane rate amalgamation, in particular the persons or societal groups in Revelstoke who would be the likely beneficiaries of the lower propane rate, as well as the potential to alternatives use the proposed subsidy for a renewable wood to gas facility.

SECTION A: ECONOMIC CONSIDERATIONS

5. In the past 10 years (2009 to 2019), heating a household with propane was on average less

expensive than heating with electric baseboards but more expensive than heating with wood

(i.e., pellets, cordwood, district heating from RCEC). If propane rates were lower by

approximately 50% as proposed in FEI’s application, then it will become less expensive to use FEI

propane than wood pellets and district heat, in some cases less expensive than cordwood, as

shown in Figure 1 and Table 1 below.

2

Figure 1: Residential heat cost in Revelstoke

Table 1: Comparison of effective heat cost per GJ of heat

1 Total annual cost including basic charge

2 BC Hydro residential Step 1 (min) and Step 2 (max) rate + basic charge at 10,000 kWh/year, see BC Hydro, "Residential Rates", accessed

on Feb 1, 2020 at

https://app.bchydro.com/accounts-billing/rates-energy-use/electricity-rates/residential-rates.html 3 Minimum and maximum total cost per GJ in the period 2009 to 2019 based on Exhibit B-1, Figure 2-2, FORTIS BC ENERGY INC,

REVELSTOKE PROPANE PORTFOLIO COST AMALGAMATION APPLICATION, downloaded on Dec 20, 2019 at

https://www.bcuc.com/Documents/Proceedings/2019/DOC_55159_B-1-FEI-Revelstoke-PropanePortolioCostAmal-App.pdf

4 Rough estimate: Free pick-up at cutblocks around Revelstoke, automotive and chain saw fuel cost only

5 Common price for delivered cordwood in Revelstoke

6 Estimated price based on revenue statements in financial year-end; price for residential user likely higher than for commercial users

7Prices of local vendors; no PST on pellets

8 Minimum and maximum price of fuel oil in the period 2009 to 2010 in Vancouver; source: Natural Resources Canada,

"Monthly average retail prices for gasoline and fuel oil, by geography", accessed on Feb 02, 2020 at

http://www2.nrcan.gc.ca/eneene/sources/pripri/prices_bycity_e.cfm?productID=6&locationID=6&locationID=2&frequency=

W&priceYear=2019&Redisplay= 9 Minimum and maximum price of auto propane, excluding motor fuel tax, in the period 2009 to 2010 in Kelowna; source:

Natural Resources Canada, "Monthly average retail prices for gasoline and fuel oil, by geography", accessed on Feb 02, 2020

at

0 10 20 30 40 50 60 70 80

Electric heat pump

Subsidized propane (Fortis BC)

Cordwood

RCEC district heat

Pellets

Propane (Fortis BC)

Electric baseboard or furnace

Heating oil

Distributed propane

Cost to household, in $ per GJ of heat

Household heat energy cost in Revelstoke

Energy source / Price, incl. taxes & levies Calorific value Appliance efficiency Cost per GJ of heat

appliance type Min Max Unit (Higher Heating Value) Min Max Min Max Average Current

Pmin Pmax HHV hmin hmax

Cmin =

Pmin /HHV/hmax

Cmax =

Pmax /HHV/hmin

1 Electric heat pump $0.111,2

$0.161,2

per kWh 0.0036 GJ/kWh 208%15

350% $8.5 $20.9 $14.7 $14.7

2 Subsidized propane (Fortis BC) $12.11,3

$17.91,3

per GJ 1 GJ/GJ 75% 95%16

$12.7 $23.8 $18.3 $15.4

3 Cordwood $504

$2505

per cord 14.1 GJ/cord10

63%17

84%17

$4.2 $28.1 $16.2 $16.2

4 RCEC district heat $16.06

$18.26

per GJ 1 GJ/GJ 95% 100% $16.0 $19.1 $17.6 $17.6

5 Pellets $2897

$3687

per tonne 17.6 GJ/tonne11

70%18

83%18

$19.8 $29.8 $24.8 $24.8

6 Propane (Fortis BC) $17.01,4

$29.01,4

per GJ 1 GJ/GJ 75% 95% $17.9 $38.6 $28.3 $26.0

7 Electric baseboard or furnace $0.111,2

$0.161,2

per kWh 0.0036 GJ/kWh 95% 100% $29.8 $45.8 $37.8 $37.8

8 Heating oil $0.868

$1.558

per litre 0.0388 GJ/litre12

70% 85% $26.1 $57.0 $41.5 $43.6

9 Distributed propane $0.599

$1.329

per litre 0.0256 GJ/liter13

75% 95%16

$24.3 $68.7 $46.5 $46.5

..

..

3

http://www2.nrcan.gc.ca/eneene/sources/pripri/prices_bycity_e.cfm?productID=6&locationID=6&locationID=2&frequency=

W&priceYear=2019&Redisplay= 10 Air dried wood at 30% moisture content (wet basis) 11 European Class A1 pellets (EN 14961-2), as produced by most Canadian pellet manufacturers (moisture content < 10% wet

basis, ash content < 0.7%) 12 Government of Canada, Justice Laws Website, Schedule 3, "Default Higher Heating Values", Table 2 Liquid Fuels, Light fuel oil;

accessed on Feb 15, 2020 at https://laws-lois.justice.gc.ca/eng/regulations/SOR-2016-151/page-27.html 13 BC Ministry of Finance, "Tax Information Sheet - Conversion Factors for Fuel", downloaded on Feb 15, 2020 at

https://www2.gov.bc.ca/assets/gov/taxes/sales-taxes/publications/conversion-factors-by-fuel.pdf 14 Minimum efficiency of an oil furnace manufactured after July 3, 2019, NRCan, "Energy Efficiency Regulations", accessed on

Feb 15, 2929 at https://www.nrcan.gc.ca/energy-efficiency/energy-efficiency-regulations/guide-canadas-energy-efficiency-

regulations/oil-fired-furnaces/6887 15 Minimum Heat Seasonal Performance Factor of 7.1 BTU/Wh for an air-source heat pump manufactured after Jan 1, 2017,

NRCan, "Energy Efficiency Regulations", accessed on Feb 15, 2020 at https://www.nrcan.gc.ca/energy-efficiency/energy-

efficiency-regulations/guide-canadas-energy-efficiency/split-system-central-air-conditioners-and-heat-pumps/6895 16 95% minimum efficiency of a gas furnace manufactured after July 3, 2019, NRCan, "Energy Efficiency Regulations", accessed

on Feb 15, 2020 at https://www.nrcan.gc.ca/energy-efficiency/energy-efficiency-regulations/guide-canadas-energy-

efficiency/gas-furnaces/6879 17 US Environmental Protection Agency (EPA), "Frequent Questions about Wood-Burning Appliances", accessed on Feb 15, 2020

at https://www.epa.gov/burnwise/frequent-questions-about-wood-burning-appliances 18 EPA approved pellet stove, US Energy Department, "Wood and Pellet Heating, Pellet Fuel Appliances", accessed on Feb 15,

2020 at https://www.energy.gov/energysaver/heat-and-cool/home-heating-systems/wood-and-pellet-heating

6. Revelstoke is located in climate zone 4 while the majority of Fortis BC’s natural gas clients are

located in the Lower Mainland which is climate zone 2.1

7. According to long-term weather normals there are 2,775 heating degree days in Vancouver and

4,611 heating degree-days in Revelstoke, i.e. 66% more than in Vancouver.2 A building located in

Revelstoke should therefore consume 66% more heating energy than the same building in

Vancouver. If the average dwelling in the area serviced by natural gas by Fortis consumes 90 GJ

per year, the same building would use 150 GJ per year in Revelstoke.

8. 44% of occupied private dwellings in the Province of BC were built prior to 1991. In Revelstoke

70% of occupied private dwellings were built prior to 1991. The building and insulation standard

of the majority of private dwellings can be expected to be lower in Revelstoke than in the rest of

the province.10 Regardless of climatic impacts the average dwelling in Revelstoke should use

more heat energy than the average in the rest of the province.

9. A typical residential natural gas customer in the FEI Mainland and Vancouver Island service area

uses on average 90 GJ and a typical residential propane customer in Revelstoke uses on average

50 GJ, i.e. 56% less. 3 Because the climate is harsher in Revelstoke than in FEI Mainland and

1 BC Building Code 2018, “Appendix C- Climatic and Seismic Information for Building Design in British Columbia”,

downloaded on Feb 2, 2020 at

http://free.bcpublications.ca/civix/document/id/public/bcbc2018/bcbc_2018dbac. 2 Heating Degree days for Vancouver and for Revelstoke, Canadian Climate Atlas, “1981-2010 Climate Normals &

Averages”, 3 Exhibit B-1, Footnote 4, FORTIS BC ENERGY INC, REVELSTOKE PROPANE PORTFOLIO COST AMALGAMATION

APPLICATION, downloaded on Dec 20, 2019 at

4

Vancouver Island, and because the building stock in Revelstoke is older than in those areas,

insulation standards and energy efficiency cannot explain this difference.

10. According to the BC government‘s Community Energy and Emission Inventory, more than 37%

of heating fuel was provided by wood, with additional 9% by electricity.4 Many households have

two types of heating, a primary and a secondary source, such as electric baseboards with a

wood stove as a secondary source, or a propane furnace with electric baseboards in selected

rooms, or a propane furnace with a wood stove in only one room of the dwelling. These

households have the ability to partly switch between the two sources of heat and do so,

especially during fall and spring when the need for heat is temporary.

11. Consequently, if the propane price were to drop to lower than competing energy sources such

as wood or electricity, as would occur if FEI’s proposed amalgamated propane rate is approved,

then as rational consumers households equipped with two sources of heating will use the lower

cost propane heating source instead of low carbon electricity or wood as much as possible in

order to reduce household costs. Accordingly, demand for and consumption of FEI propane is

likely to increase for existing FEI residential propane customers with a propane and an

alternative heat source.

12. With respect to the lower amalgamated cost of propane inducing residents with oil heating to

convert to FEI propane, heating oil is already significantly more expensive than propane, see

Figure 1. Rational consumers using heating oil would have switched already to lower cost

propane to save money, unless installation costs are too high or the propane network too far

away.

13. A further reduction in price of propane is unlikely to induce many heating oil dwellings to

convert to propane, since it is already rational for consumers to make that choice based on fuel

costs alone, see Table 2 below. To the extent that there are heating oil customers who could be

induced to fuel switch to save money, the amalgamated propane rate would make it more likely

for heating oil customers to switch to propane rather than to a low-GHG emitting wood stove,

whereas at current rates wood stoves are cost competitive with propane. Propane would also

become more cost-competitive with low-GHG emitting heat pumps, increasing the likelihood of

heating oil users to switch to a propane furnace rather than a heat pump.

https://www.bcuc.com/Documents/Proceedings/2019/DOC_55159_B-1-FEI-Revelstoke-

PropanePortolioCostAmal-App.pdf 4 Data of the Community Energy and Emission Inventory of 2012 to 2016, see Government of BC, “Provincial

Greenhouse Gas Emissions Inventory”, downloaded on Jan 30, 2020 at

https://www2.gov.bc.ca/assets/gov/environment/climate-change/data/provincial-

inventory/2017/utilities_energy_data_2007-2017.xlsx

5

Table 2: Conversion cost of end-of-life oil furnace to competing fuels and appliances

Oil furnace

Propane

furnace

Propane

furnace

Air-source

heat pump

Wood pellet

stove

Unit

Re-

placement

furnace

Current

propane

pricing

Subsidized

propane

Equipment cost $4,250 1 $4,400 2 $4,400 2 $4,995 5 $4,737 7

Installation cost $1,000 $1,000 $1,000 $1,000 $650 7

Oil tank removal $0 $1,475 3 $1,475 3 $1,475 3 $1,475 3

Other conversion costs $0 $1,150 4 $1,150 4 $5,500 6

Total cost per unit $5,250 $8,025 2 $8,025 2 $12,970 $6,862

Capital subsidy 0% 0% 0% 0% 0%

$0 $0 $0 $0 $0

Total cost to owner/user $5,250 $8,025 $8,025 $12,970 $6,862

Annuity to owner/user $/yr. $974 8 $1,489 8 $1,489 8 $2,407 8 $1,273 8

Heat use GJ/yr. 103 9 103 9 103 9 103 9 103 9

Appliance efficiency % 78% 10 95% 11 95% 11 279% 12 77% 13

Heat cost per GJ $/GJ $42 $28 $18 $15 $25

Annual heating bill $/yr. $5,483 $3,063 $1,978 $543 $3,338

Total annual cost $/yr. $6,457 $4,552 $3,467 $2,950 $4,611

1

Canadian Furnace Pricing Guide, accessed on Feb 14, 2020 at https://www.furnaceprices.ca/furnaces/furnace-prices/

2 FurnacePrices.ca, "Propane Furnace Prices Installation Cost, Benefits, and Conversions"; accessed on Feb 14, 2020 at

https://www.furnaceprices.ca/furnaces/propane-furnace-pricing/

3 Tri-City Tank Tech, "How much does a standard tank removal cost?", accessed on Feb 14, 2020 at https://oiltank.ca/faq-items/how-

much-does-a-standard-tank-removal-cost/

4 Cost for a power vent kit and a metal chimney, see Energyshop, "The Costs of Converting to Natural Gas", accessed on Feb 154,

2020 at http://www.energyshop.com/es/info/equipcos.cfm

5 Homestars, "Guide to Heating % Cooling Costs & Estimates in Canada", accessed on Feb 14, 2020 at https://homestars.com/cost-

guides/heating-cooling-cost/

6 Philip Jang, Times Colonist, "How our household is saving $2,400 a year on heating costs (with asterisk)", accessed on Feb 14, 2020

at https://www.timescolonist.com/opinion/how-our-household-is-saving-2-400-a-year-on-heating-costs-with-asterisk-1.2179939

7 Wood Pellet Association of Canada, "Annual Home Heating Cost - Revelstoke, BC, accessed on March 14, 2020 at

https://www.woodpelletheat.ca/case-studies/#1504802547366-2cdfb3b4-1772

8 Assuming 7% interest 7 years depreciation

6

9 Based on data of the Community Energy and Emission Inventory for Revelstoke, accessed on Feb 18, 2020 at

https://www2.gov.bc.ca/assets/gov/environment/climate-change/data/provincial-inventory/2017/utilities_energy_data_2007-

2017.xlsx

10 78% minimum efficiency of an oil furnace manufactured after July 3, 2019, NRCan, "Energy Efficiency Regulations", accessed on

Feb 15, 2020 at https://www.nrcan.gc.ca/energy-efficiency/energy-efficiency-regulations/guide-canadas-energy-efficiency-

regulations/oil-fired-furnaces/6887

11 95% minimum efficiency of a gas furnace manufactured after July 3, 2019, NRCan, "Energy Efficiency Regulations", accessed on

Feb 15, 2020 at https://www.nrcan.gc.ca/energy-efficiency/energy-efficiency-regulations/guide-canadas-energy-efficiency/gas-

furnaces/6879

12 Average of assumed maximum energy efficiency of 350% and required minimum efficiency of 208% for an air-source heat pump

manufactured after Jan 1, 2017, NRCan, "Energy Efficiency Regulations", accessed on Feb 15, 2020 at

https://www.nrcan.gc.ca/energy-efficiency/energy-efficiency-regulations/guide-canadas-energy-efficiency/split-system-central-

air-conditioners-and-heat-pumps/6895

13 EPA approved pellet stove, US Energy Department, "Wood and Pellet Heating, Pellet Fuel Appliances", accessed on Feb 15, 2020

at https://www.energy.gov/energysaver/heat-and-cool/home-heating-systems/wood-and-pellet-heating

SECTION B: ENVIRONMENTAL IMPACTS

14. With the exemption of heating oil, GHG emissions from heating with propane are higher than

from any other heating energy used in Revelstoke, see the graph below.

Figure 2: GHG emission factors of various fuels and appliances

0 10 20 30 40 50 60 70 80 90 100

Electric heat pump

RCEC district heat

Electric baseboard or furnace

Pellets

Cordwood

Propane

Heating oil

GHG emission, in kg of CO2-eq per GJ of end-use heat

I t I

7

Table 3: GHG emission factors of various fuels and appliances

Emission

factor

Appliance

efficiency Effective emissions, per GJ of heat

Energy source /

appliance type kg/GJ Min Max Min Max Average Percentage

FGHG hmin hmax

Emin =

FGHG / hmax

Emax =

FGHG / hmin

of propane

Electric heat pump 3.0 208% 350% 0.9 1.4 1.1 2%

RCEC district heat 2.24 70% 80% 2.8 3.2 3.0 4%

Electric baseboard or furnace 3.0 95% 100% 3.0 3.2 3.1 4%

Pellets 19.07 70% 83% 23.0 27.2 25.1 34%

Cordwood 19.07 63% 84% 22.7 30.3 26.5 36%

Propane (Fortis BC) 61.15 75% 95% 64.4 81.5 73.0 100%

Distributed propane 61.15 75% 95% 64.4 81.5 73.0 100%

Heating oil 68.37 70% 85% 80.4 97.7 89.1 122% Source data from BC Ministry of Energy.5

15. According to the BC Government‘s Provincial Greenhouse Gas Inventory – Community Energy

and Emission Inventory, 79% of Revelstoke buildings use heat energy sources other than piped

propane, see the Figure 3 and Table 4 below.6

5 BC Ministry of the Environment and Climate Change Strategy, “2017 B.C. Best Practices Methodology for

Quantifying Greenhouse Gas Emissions”, Feb 2018, downloaded on Feb 02, 2019 at

https://www2.gov.bc.ca/assets/gov/environment/climate-change/cng/methodology/2017-pso-

methodology.pdf 6 Data of the Community Energy and Emission Inventory of 2012 to 2016, see Government of BC, “Provincial

Greenhouse Gas Emissions Inventory”, downloaded on Jan 30, 2020 at

https://www2.gov.bc.ca/assets/gov/environment/climate-change/data/provincial-

inventory/2017/utilities_energy_data_2007-2017.xlsx

8

Figure 3: Energy use for residential heating purposes in Revelstoke, in GJ per year

Table 4: Residential energy use for heating in Revelstoke

Secondary energy use

Average 2012 to 2017 GJ per year

Electricity 170,153

Electricity for heating 28,215 8% 1

Piped propane 70,179 21%

Estimated oil 63,819 19%

Estimate bottled propane 47,113 14%

Estimate wood 124,712 37%

Estimate district heat 600 0.2% 2

TOTAL 334,638 100%

Total per dwelling 103 3

1 Assumption that every household uses 900 kWh/month for non-heating electricity, see

https://www.bchydro.com/search.html?site=bchydro-com&client=bchydro-com&proxystylesheet=bchydro-

com&output=xml_no_dtd&q=average+apartment+bill 2

One bed and breakfast at 200 GJ/year and one apartment building with 8 units each 50 GJ/year 3

3,250 occupied dwellings according to Census 2016 data

16. Because 8% of Revelstoke’s heat energy comes from low GHG-emitting hydropower and 37%

comes from low GHG-emitting wood, GHG emissions will go up by 46% if all of Revelstoke heat

energy were provided by propane, see Table 5 below. Likewise, if the current share of non-

propane heated buildings were to convert to propane, then GHG emissions will go up, on

average by 46%.

Electricity,

28,215 - 9%

Piped propane,

70,179 - 21%

Heating oil*,

63,819 -19%

Bottled

propane*,

47,113 - 14%

Wood*,

124,712 - 37%

District

heating**, 600

- 0.2%

* Estimate of CEEI

** Own estimate

9

Table 5: GHG emissions from various heating sources in Revelstoke

Emission factor Usage

Total GHG GHG-emissions if all propane

Energy source / emissions Total Change

appliance type kg/GJ GJ/year t of CO2-eq /yr. t of CO2-eq /yr. t of CO2-eq /yr.

FGHG U GHG = FGHG x U

Electric heat pump 3.0 2,000 1 6 122 +116 +1938%

RCEC district heat 2.2 600 2 1 37 +35 +2630%

Electric baseboard or furnace 3.0 26,215 3 79 1,603 +1,524 +1938%

Pellets 19.1 62,356 4 1,189 3,813 +2,624 +221%

Cordwood 19.1 62,356 4 1,189 3,813 +2,624 +221%

Propane (Fortis BC) 61.2 70,179 5 4,291 4,291 +0 0%

Distributed propane 61.2 47,113 5 2,881 2,881 +0 0%

Heating oil 68.4 63,819 5 4,363 3,903 -461 -11%

TOTAL 334,638 14,000 20,463 +6,463 +46%

1Assuming 20 residential dwellings using a heat pump, annual heat use of 100 GJ/year each

2One bed and breakfast at 200 GJ/year and one apartment building with 8 units each 50 GJ/year

3 CEEI data for 2012 to 2016 & assumption that every household uses 900 kWh/month for non-heating electricity, see

https://www.bchydro.com/search.html?site=bchydro-com&client=bchydro-com&proxystylesheet=bchydro-

com&output=xml_no_dtd&q=average+apartment+bill 4

CEEI estimate & assumption that 50% of household energy using wood as a fuel is supplied by pellets,50% by cordwood 5

CEEI data for 2012 to 2016

17. Fortis BC expects an increase in propane use in Revelstoke, see Figure 4 below.7 As detailed in

Section B below, increases in propane use will most likely come from clients already connected

to the propane distribution system, in particular dwellings that use both a propane and a

electric or wood heating source that would be incentivized at the amalgamated rates to use

propane more often rather than more expensive electric or wood fuels, and due to connections

to new or remodelled buildings, also incentivized to do so by the lower amalgamated propane

rates. Increased use of propane in Revelstoke will lead to increased GHG-emissions.

7 Exhibit B-1, Figure 4-2, FORTIS BC ENERGY INC, REVELSTOKE PROPANE PORTFOLIO COST AMALGAMATION

APPLICATION, downloaded on Dec 20, 2019 at

https://www.bcuc.com/Documents/Proceedings/2019/DOC_55159_B-1-FEI-Revelstoke-

PropanePortolioCostAmal-App.pdf

10

Figure 4: Propane demand in Revelstoke as forecasted by Fortis BC 7

18. Fortis BC’s planned increase in propane sales does not accord with provincial fossil fuel use

targets laid down in the Clean BC Plan, see the Figure 5 below.8

Figure 5: Fossil fuel use development as planned by the Province of BC

8 Province of BC, “Clean BC – Our nature. Our power. Our future”, Dec 2018, graph on page 11, downloaded on

Feb 3, 2020 at

https://blog.gov.bc.ca/app/uploads/sites/436/2019/02/CleanBC_Full_Report_Updated_Mar2019.pdf

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11

SECTION C: SOCIO-ECONOMIC IMPACTS

19. According to the Canadian Rental Housing Index, of the 3,250 total households there are a total

of 875 renter households, and 2,380 owner households, see Appendix A. The median income of

Revelstoke household income is higher than the median income for British Columbian

households ($50,178 vs. $45,979). In addition, renter households in Revelstoke pay less on

average on rent and utilities than households for British Columbia as a whole ($1,014 vs.

$1,148), and spend less as a proportion of their income (20% vs. 23%).9 These statistics indicate

that the affordability of rent and of utility costs (including heating costs) is not on average worse

than for other communities in British Columbia. Issues of affordability of rent and utilities,

including heating costs, are therefore likely an issue for low income households rather than

middle and upper income households, as addressed in the paragraphs that follow.

20. According to Statistics Canada Census 2016, there are 3,250 occupied private dwellings, of

which 395 (12%) dwellings are apartments in a building that has fewer than five stories.10

According to the Revelstoke Community Poverty Reduction Strategy – Final Report June 2012,

17% of Revelstoke households receive income assistance and additional 19% live below the

living wage threshold.11,12 The report estimated the number of food bank users at 269, with

most of those persons living in private rental housing (approximately 67%).13 In 2011, the

average rent for a 1 bedroom rental apartment in 2011 was estimated at $669, with smaller low

end apartments as low as $500 per month, whereas large apartments and houses rented for

over $1,000, with prices reflecting an average of approximately $1 per square foot.14

21. According to the Canadian Rental Housing Index, the lowest quartile of income-earning renters

in Revelstoke earn on average $15,620 per year, with 70% of those renters living in one

bedroom housing units.15 Lowest quartile income-earning renters in Revelstoke pay on average

$636 per month for rent, heat, hot water and electricity (combined) for a one bedroom unit,

which is lower than in Burnaby ($892), Kamloops ($715), Surrey ($713), and Victoria ($909)

where lowest quartile income-earners have the same or lower average earnings than in

9 Canadian Rental Housing Index, “A Snapshot of Renter Households in British Columbia & Revelstoke”, accessed

on February 08. 2020 at http://rentalhousingindex.ca/en/#comp_csd (Printout provided in Appendix A) 10 Statistics Canada’s 2016 Census data, Revelstoke census subdivision, accessed on Jan 24, 2020 at

https://www12.statcan.gc.ca/census-recensement/2016/dp-pd/prof/index.cfm?Lang=E 11 Revelstoke Community Poverty Reduction Strategy – Final Report, June 2012, accessed on Jan 24, 2020 at

https://www.revelstokesocialdevelopment.org/assets/files/Rev%20Poverty%20Strategy(2).pdf 12 See also: Columbia Basin Rural Development Institute with the City of Revelstoke Social Development

Coordinator, “A Statistical Snapshot on the State of Poverty in Revelstoke, BC”, Feb 2018, downloaded on Feb

2, 2020 at https://www.revelstokesocialdevelopment.org/wp-content/uploads/2018/03/Snapshot-on-State-of-

Poverty-in-Revelstoke-FINAL.pdf 13 Revelstoke Community Poverty Reduction Strategy – Final Report, June 2012, pp. 52-53 14 Ibid., p. 10 15 Canadian Rental Housing Index, “Number of Renter Households in Burnaby, Kamloops, Revelstoke, and

Victoria”. Data Retrieved on February 07, 2020 from http://rentalhousingindex.ca/en/#renter_csd (Printout

provided in Appendix B)

12

Revelstoke.16 Renters with higher earnings live in larger apartments or houses; for example, top

quartile renters who earn on average $123,052, pay on average $1,214 per month for rent plus

heat, hot water and electricity. Renters in Revelstoke on average earn more income and pay less

for rent plus utilities including heat, hot water and electricity than renters in Burnaby, Kamloops,

Surrey or Victoria.17

22. The above statistics indicate that most low-income residents in Revelstoke live in low-cost rental

apartments, likely in low-cost apartment buildings.

23. Few apartment buildings in Revelstoke are serviced by FEI propane.18

24. BC Hydro promoted electric heating after the Revelstoke dam was built, partly by offering low

cost electric heat though its discounted Residential E-plus rate. While the rate is being phased

out,19 many residential dwellings are still on electric heating. Converting dwellings from electric

baseboard heating to forced air or hydronic heating, the type of heating provided by propane

furnace or boiler, is difficult and expensive, for example because of the cost to install ducting.

Renters or owners of these dwellings of all income levels will not benefit from lower propane

rates.

25. Residents who have higher average incomes and live in larger dwellings, which generally have

greater heating energy needs due to high square footage, and that are currently supplied by

propane by FEI, are the residents who will benefit most from subsidized propane prices. Lower

income residents living in small apartments without propane heating will not benefit at all.

Lower income residents who live in apartments or other small dwellings that do have propane

heating will benefit to a lesser extent than higher income residents in larger dwellings due to the

lower amount of energy required to heat smaller dwellings.

26. The FEI amalgamated propane rate proposes a cross-subsidy of approximately $1.8 million per

year, paid for by FEI natural gas rate payers in other parts of BC to FEI propane customers in

Revelstoke. The primary recipients of the subsidy would be commercial customers, with small

commercial customers at $601,649 (33%), large commercial customers at $494,927 (28%) and

residential users at $713,064 (39%).

16 Canadian Rental Housing Index, “Cost of Rent Plus Utilities Including Heat, Hot Water and Electricity for

Burnaby, Kamloops, Revelstoke, Surrey and Victoria”. Data Retrieved on February 07, 2020 from

http://rentalhousingindex.ca/en/#cost_csd (Printout provided in Appendix C) 17 Ibid. 18 Visible by the absence of smoke stacks or gas meters at apartment buildings. 19 BC Hydro, “E-Plus rate updates - Residential E-Plus rate customers”, accessed on Jan 25, 2020 at

https://www.bchydro.com/toolbar/about/planning_regulatory/2015-rate-design/eplus.html

13

Figure 6: Subsidy recipients in Revelstoke

Table 6: Subsidy levels for individual user groups

Average

annual usage

per client Average annual bill

impact

2020

forecast

for annual

use

Total subsidy Percentage

of subsidy

Rate Schedule GJ/yr. $/yr. $/GJ GJ/yr.

RS-1R Residential 50 1 -$407 1 -$8.14 87,600 2 $713,064 39%

RS-2R Small Commercial 300 1 -$2,116 1 -$7.05 85,300 2 $601,649 33%

RS-3R Large Commercial 6,650 1 -$48,259 1 -$7.26 68,200 2 $494,927 27%

Thereof Downie Timber >$300,000 4 17%

Thereof other large commercial user <$194,927 11%

TOTAL 241,100 3 $1,809,640 100%

1FEI application, Table 5-1, page 20

2FEI rate application, Appendix A, Line 1 MCRA Demand

3FEI application, Table 3-3

4 Evidence of Downie Timber, Jan 13, 2020, Exhibit C4-2, downloaded on Feb 15, 2020 at

https://www.bcuc.com/Documents/Proceedings/2020/DOC_56806_C4-2-Downie-Timber-IntervenerEvidence.pdf.

Residential users,

$713,064 -39%

Small commercial

users, $601,649 -

33% Downie Timber,

>$300,000 - 17%

Other large

commercial user,

<$194,927 - 11%

Large commercial

users, $494,927 -

28%

Total of $1.8 million per year

14

27. According to the statistics provided above, it is likely that only a small number of low income

residents would benefit from the subsidized amalgamated rate; most of the approximately

$713,000 of the residential portion of the subsidy (see Figure 6 and Table 6 above) would likely

be paid to middle and high income residential FEI propane customers. Revelstoke residents of all

incomes who heat their homes with other sources of energy will receive no part of the subsidy.

28. The 61% of the total subsidy (approximately $1.1 million) that would be paid to commercial

users would not reduce the heating costs of any Revelstoke residents.

29. An alternative use of an annual $1.8 million subsidy that would create positive economic

impacts for Revelstoke would be to invest that money in a wood to renewable gas facility.

30. B.C.’s climate goals require substantial decarbonization of all sectors of society. The province’s

Clean BC plan calls for 15% renewable gas by 2030.20 Due to B.C.’s northern climate and its small

arable land area, 21 agricultural products and by-products have limited potential for bioenergy

production, especially in Revelstoke. Woody biomass is the most abundant feedstock available

and will be the main resource of the bioeconomy in the future. With its well-established forestry

and wood processing sector, Revelstoke is a good location to become a leader in next

generation lignocellulosic biofuels, i.e. fuels made from wood. This includes possibilities to

convert wood waste to a gas that could replace propane.22

31. Revelstoke has access to more than 76,000 bone-dry tonnes (bdt) of wood waste/biomass

available. The cost of these range from $0 (waste) to $100 per bdt. 22 Downie Timber is the

largest exporter of low-carbon biomass. It has large amounts of wood waste/biomass that could

be used in a renewable gas facility. It is also the largest user of propane in Revelstoke.

32. A wood to renewable gas plant consuming 1,000 to 2,000 bdt a year would cost around $10 to

$20 million whereas a 40,000 bdt-plant would likely require around $80 million in initial capital

investment. 22 By comparison, FEI suggested a liquefied natural gas (LNG) plant in 2016 for

Revelstoke at capital cost of $25 million.23

Date Submitted: February 18, 2020 ______________________________

Signature of Cornelius Suchy

20 BC Gov News, “CleanBC plan to reduce climate pollution, build a low-carbon economy”, Dec 5, 2018, accessed on Feb 16, 2020 at https://news.gov.bc.ca/releases/2018PREM0088-002338

21 Only 4% of BC is arable land, see Provincial Agricultural Land Commission, Agricultural Capability & the ALR Fact Sheet, table 2, downloaded on Dec 20, 2019 at https://www.alc.gov.bc.ca/assets/alc/assets/library/agricultural-

capability/agriculture_capability__the_alr_fact_sheet_2013.pdf

22 Thomas Cheney, “Biofuel Production from Western Hemlock Pulpwood - Technology Scan prepared for the Revelstoke Community Forest Corporation”, June 28, 2017

23 Joe English, Fortis BC, “Revelstoke NG Conversion Presentation to BCSEA”, Mar 1, 2016, slide 11

15

Appendices

Appendix A: A Snapshot of Renter Households in British Columbia & Revelstoke

Appendix B: Comparison of household income in selected communities of BC

Appendix C: Comparison of rental cost in selected communities of BC

Appendix D: Resumé of Cornelius Suchy

APPENDIX A

APPENDIX B

APPENDIX C

• • • D D T

I I I I I

Resume - Cornelius Suchy Feb 2020 Page 1 of 4

APPENDIX D

Resumé of Cornelius Suchy

RENEWABLE ENERGY PROFESSIONAL

CAREER SUMMARY

Cornelius Suchy is a renewable energy professional with 25 years of work experience in the field.

He started his career working at the prestigious Fraunhofer Institute for Solar Energy, Europe’s largest

research facility for renewable energy.

Organizations he has worked for include various cities and aboriginal communities, provincial and national

governments, the Asian Development Bank, the European Commission, the European Parliament, the

Global Environmental Fund, the International Renewable Energy Association (IRENA), the United Nations,

and the World Bank.

As a consultant he has conducted feasibility studies, technical-financial analyses, and market studies. He

has undertaken environmental impact studies, developed energy scenarios and models and given policy

advice to local, provincial and national governments, including NRCAN and INAC in Ottawa.

As an engineer he has performed schematic and detailed designs. In a role as an owner’s engineer he has

written technical specifications and has overseen the selection and procurement of renewable energy

equipment and services. As a general contractor he has supervised and assessed installation and

rehabilitation works on district and biomass energy systems.

His expertise stems from engagement in numerous projects, some in the study, some in the design, others

in the implementation phase in Bhutan, Germany, Nepal, Uzbekistan, Kazakhstan, the Kyrgyz Republic,

the Ukraine, Tajikistan and for the past 17 years, in Canada.

He has worked on numerous biomass energy projects, including in Canada’s North. His practical know-

how comes from real life projects rather than text books.

Cornelius is well familiar with the opportunities – and challenges that biomass energy technologies pose.

Countries, such as Austria, Germany and Switzerland have recognized these challenges and have

implemented a quality assurance scheme (“QM Holzheizwerke”) that allows eliminating key mistakes

already in the planning stage. Cornelius is the only certified Quality Manager in Canada. He has given

various training courses and written parts of Nipissing University’s curriculum for Bioenergy 101.

Cornelius combines his work with his responsibilities as coach for Judo in Revelstoke. In the past he sat

two years on of the Environmental Advisory Board of the City of Revelstoke and three years on the Board

of Director of the British Columbia Sustainable Energy Association.


EDUCATION

Fachhochschule Nordwestschweiz, Switzerland - Energy Engineer 1993-1994

Fraunhofer Institute for Solar Energy Systems (ISE), Germany - Master Thesis 1990-1992

Universität Freiburg, Germany – Diplom (M.Sc. equivalent), Physics, Mathematics 1989-1992

Brock University, Canada – B.Sc. Physics 1988-1989

Universität Freiburg, Germany – Bachelareus, Physics 1984-1988

CURRENT DESIGNATION:

PRESENT POSITION: CEO CANADIAN BIOMASS ENERGY RESEARCH (CBER) LTD.

YEARS OF PROFESSIONAL EXPERIENCE: 25 YEARS

KEY QUALIFICATIONS:

Renewable Energy Technology (RET) District Heating & HVAC

Biomass energy technologies

Solar Photovoltaic (PV)

District heating

Solar thermal technologies

Wind power development

Grid Integration of RET

Master planning and design of district heating

Energy efficiency upgrades to HVAC systems

HVAC design, incl. energy management

Integration of renewables into HVAC systems

Conversion of buildings to hydronic heating

Monitoring of HVAC performance

Engineering & Design Consulting

Preliminary to detailed designs

CAPEX & OPEX cost estimates

Technology assessments

Development of technical tender documents

Technical bid evaluation

Feasibility studies & financial analyses

Market research studies

Analysis of legal framework

Energy scenarios/planning models

Training and curriculum development

PUBLICATIONS

Co-author of an Encyclopaedia of Physics (published in 2000)

Various publications in international magazines on renewables

Numerous presentations during international conferences and seminars on energy efficiency and

renewable energy


PROFESSIONAL EXPERIENCE RECORD:

Jul 2009 – present: CEO, CANADIAN BIOMASS ENERGY RESEARCH (CBER), Revelstoke, B.C., Canada

Jul 2005 – May 2009: CEO, MAWERA (Canada) Ltd, Revelstoke, B.C., Canada

Aug 2004 – Jun 2005: Project Leader / Team Leader for the Renewable Energy Project Nepal,

SOFRECO, Lalitpur, Nepal

Jan 2003 – Jul 2004: Freelance consultant, Revelstoke, B.C., Canada

Mar 1999 – Jun 2002: Head of Almaty office, MVV CONSULTANTS & ENGINEERS GmbH, Almaty,

Kazakhstan

Apr 1997 to Mar 1999: 1999 Project/Task Manager, INTERNATIONAL CENTRE FOR ENERGY AND

ENVIRONMENTAL TECHNOLOGIES Brussels, Belgium

Jun 1994 – May 1996: Project assistant, INSTITUTE FOR APPLIED ECOLOGY Freiburg, Germany

Feb 1993- Oct 1993: Freelance consultant, ARCHITECT FIRM M. BLASWEILER, Freiburg, Germany and

Beuren, Germany

Mar 1990 - Aug 1992: Research assistant, FRAUNHOFER-INSTITUTE FOR SOLAR ENERGY SYSTEMS

Freiburg, Germany


SELECTED PROJECT EXPERIENCE

XENI GWETIN FIRST NATION, 2019

Biomass Combined Heat & Power Feasibility Study for

Nemiah Valley, BC.

BC BIOENERGY NETWORK AND BC MINISTRY OF

ENERGY, 2019

Comprehensive plan for revitalizing the B.C. Bioenergy

Sector in light of the Clean BC targets.

NATURAL RESOURCES CANADA (NRCAN), 2018-19 Energy Economics and Subsidies in Remote Communities.

CANADIAN COUNCIL OF THE MINISTERS OF

ENVIRONMENT (CCME), 2018-19 Guidance for Managing Air Emissions from Small Biomass.

SELKIRK FIRST NATION, 2018

Biomass Energy Business Strategy for Pelly Crossing, YT.

NATIONAL RESEARCH COUNCIL CANADA (NRC),

VANCOUVER, 2017

Guideline for Permitting Requirements for Small

Biomass-fueled CHP Plants

NATURAL RESOURCES CANADA (NRCAN), OTTAWA,

2016

Roadmap to increased use of biomass as a partial substitute

for diesel in remote aboriginal communities.

YUKON ENERGY CORP (YEC), WHITEHORSE, 2016 Wind Site Inventory of the Yukon Territory. Economic

evaluation of seven project sites.

INDIGENOUS AND NORTHERN AFFAIRS CANADA

(INAC), OTTAWA, 2014 - 2018

Technical evaluation of renewable energy proposals and

redeveloping the ecoEnergy support program.

BRITISH COLUMBIA INSTITUTE OF TECHNOLOGY

(BCIT), BURNABY, BC, SINCE 2013

Engineering design for a wood-waste boiler plant for a

district heating system.

METRO VANCOUVER, BC, 2012- 2013

Feasibility study for an Organic Rankine Cycle (ORC) system

at two of MV’s waste water treatment plants.

CITY OF TORONTO, ON, 2011 - 2012

Feasibility Study of Potential for Use of Urban Forestry

Wood as Biomass Fuel;

T’IT’Q’ET FIRST NATIONS/ T’IT’Q’ET ECONOMIC

DEVELOPMENT AUTHORITY /TEDA) LILLOOET, BC,

2010

Feasibility study for wood residue fueled heating and

cogeneration at Aspen Planer’s Veneer Mill.

KAMLOOPS INDIAN BAND, KAMLOOPS, BC, 2009 -

2010 Feasibility study for a centralized bio waste-to-energy

system at the Kamloops Indian Band.

INTERNATIONAL RENEWABLE ENERGY ASSOCIATION

(IRENA), UNITED ARAB EMIRATES, 2016 Technical Concept Guidelines for project development of

biofuel plants.

ASIAN DEVELOPMENT BANK (ADB), TAJIKISTAN, 2015

Promotion of Direct Investment in Priority Climate

Technology Projects in vocational schools of Tajikistan.

EUROPEAN COMMISSION / GOVERNMENT OF

UZBEKISTAN / SOFRECO, UZBEKISTAN, 2009 Feasibility study for the World Bank: “On-Site Renewable

Energy Generation in Health Care and Educational Facilities

in the Province Of Andijan”.

EUROPEAN COMMISSION / GOVERNMENT OF NEPAL

/ SOFRECO, NEPAL, 2004 - 2005

Team Leader of the Renewable Energy Project Nepal.

Planned and established a € 15 million solar energy

development project.

UNITED NATION DEVELOPMENT PROGRAM (UNDP) /

CANADIAN INTERNATIONAL DEVELOPMENT AGENCY

(CIDA), KAZAKHSTAN, 2001- 2002 Solar Pre-heating Pilot Demonstration Project at a District

Heating Boilerhouse in Almaty, Kazakhstan

EUROPEAN COMMISSION / MVV CONSULTANTS &

ENGINEERS, CITY OF TASHKENT, UZBEKISTAN, 1999 -

2002 for a 3-year, €3 million project: “Technical Assistance for the

Restructuring of District Heating ”.

EUROPEAN PARLIAMENT / INTERNATIONAL CENTRE

FOR ENERGY AND ENVIRONMENT, BRUSSELS,

BELGIUM, 2001 - 2002 Potential study “Production Capacity of Renewable Energies

in the European Union”.

UNITED NATION DEVELOPMENT PROGRAM (UNDP) /

GLOBAL ENVIRONMENTAL FUND / GOVERNMENT OF

KAZAKHSTAN, ALMATY, KAZAKHSTAN, 2001 - 2002 Masterplan for District Heating in the City of Almaty.

EUROPEAN COMMISSION / GOVERNMENT OF THE

UKRAINE / MVV CONSULTANTS & ENGINEERS,

UKRAINE, 2001

Energy efficiency pilot demonstration project in the

Cherkassy General Hospital.

WORLD BANK, MINISTRY OF MACROECONOMICS

AND STATISTICS OF UZBEKISTAN, UZBEKISTAN, 1997 -

1998

Small Hydropower Investment Prefeasibility Study - National

Greenhouse Gas Mitigation Strategy Study.