Hydro offers to foot three-quarters of bill for new Campbell River water system

Both parties are “very close to finalizing” a memorandum of understanding

BC Hydro and the city are close to signing off on a deal that will cost city taxpayers.

Stephen Watson, spokesman for BC Hydro, said both parties are “very close to finalizing” a memorandum of understanding that will require Hydro to pay 75 per cent of the costs to build a new drinking water system while the city must come up with the rest.

The city’s existing water connection to BC Hydro’s penstocks will be removed in 2017 as part of the power corporation’s $1.2 billion upgrade to the John Hart Dam Generating Station.

BC Hydro and the city have been working on an alternative so that the city can continue to supply water to the community.

“We’ve been working hard with the city on the domestic water supply structure,” Watson said. “It’s several years in the making. Obviously with BC Hydro replacing the pipelines with an underground tunnel, we’ve been working with the city on separating and having their own water intake into the John Hart reservoir.”

BC Hydro has committed to pay 75 per cent, up to $12.5 million, of the costs of the new water intake system. The city has budgeted $16.6 million total for the project with $700,000 of that in 2013 for the design; $11.1 million in 2014 for construction; and a further $4.8 million for construction in 2015.

Coun. Andy Adams, who has the finance portfolio, said last summer that the city is not in a position to come up with the more than $4 million of its share and will look to grants and other means of financial support. Coun. Ron Kerr was critical of council’s decision to so readily accept BC Hydro’s offer.

“I believe they should be paying 100 per cent and that’s how you negotiate,” Kerr said last August shortly after council agreed to Hydro’s offer. “To me it just doesn’t make sense. There was limited discussion and it was done too fast. Partners don’t cut off your water supply and if we’re partners with BC Hydro you just don’t do that. They should be paying the full cost.”

Mayor Walter Jakeway agreed.

“It’s not a Campbell River responsibility,” he said. “It’s a (BC Hydro) project cost.”

The John Hart project is set to begin later this year. The winning project team is expected to be revealed this summer and a business open house will follow in the fall as an opportunity for local workers to meet the winning team.

Construction is expected to last five years and involves not only replacing the wood stave pipes with an underground tunnel but also building a new generating station next to the existing one and constructing a new water bypass facility.

The project is expected to improve power reliability and seismic safety of the facility which has been in operation since 1947.