Will BC Electrify Its Economy? BC Hydro Doubts It

Nov. 24, 2025

The Crown corporation’s new long-term plan for BC’s energy future is a missed opportunity to commit to electrification, experts say.

Premier David Eby recently described British Columbia as Canada’s future “economic engine,” one that, in a nod to climate change, would be powered “by clean, reliable, affordable power.” Lots of it.

Ten days later, the province’s Crown energy corporation, BC Hydro, quietly released a more muted vision of the path ahead. Its draft energy plan reveals the utility has scaled down its expectations for energy demand and has no plans to procure the energy B.C. would need to meet its climate targets by electrifying its industries, cars and homes.

“It seems like we’ve just put climate in the drawer and forgotten about it,” said Marc Lee, a senior economist for the Canadian Centre for Policy Alternatives.

Last year, B.C.’s clean energy strategy cited research suggesting that the province’s electricity use would “likely double” to match population growth and its climate targets by 2050. The strategy promised to supply the coming boom by sending BC Hydro shopping every two years to purchase power from independent producers. The details of those purchases, it said, would come in the utility’s forthcoming energy plan.

But that plan, which was released this month, makes no such promises.

In its new integrated resource plan, BC Hydro scrapped its last plan’s “accelerated electrification scenario,” which envisioned how B.C. could meet its climate goals. According to the utility, its current plan “does not reflect an assumption that the province will meet B.C.’s greenhouse gas emissions targets.”

Its projected demand for the coming decades shows a modest increase, far short of the doubling forecasts referenced in B.C.’s energy strategy, and only commits to one power purchase from suppliers for the coming decades. That call-out for independent power producers was announced earlier this year.

The integrated resource plan “does not provide a clear path to acquire the energy needed by our growing communities and industries,” Kwatuuma Cole Sayers, the executive director of Clean Energy BC, said in a statement, adding that it “does not capture the true scale of B.C.’s energy demand over the next two decades.”

Electrification, otherwise known as the act of switching power needs to electricity from fossil fuels, is a “key pillar” in B.C.’s tool box to reach its climate targets. The other pillars include carbon capture and fuels like green hydrogen and renewable gas, which face substantial technological and supply issues.

Now that the draft plan is submitted, B.C.’s utility regulator will assess the plan and hear from interveners.

Energy planning in 2025 is a tenuous business. In recent decades, energy demand in B.C. has been relatively steady, an ideal scenario for those gauging how much power to build and buy. But climate change could throw a spanner in the works. B.C. will need a lot more electricity to replace the fossil fuels powering things like cars and industries. The question is: when?

According to recent policy signals, not any time soon.

B.C. has recently cut its consumer carbon tax, introduced a loophole-filled industrial carbon price, abandoned its EV rebate program and weakened requirements that LNG facilities use electricity. A turbulent global economy, ongoing closures in the forest industry, U.S. tariffs and hydro-damaging drought further complicate forecasts.

If BC Hydro overspends, it could be caught looking for new customers for its unused power. But a conservative approach brings other risks in a critical decade for the world’s effort to fight runaway climate change. A 2020 study by the Canadian government warned that Canada’s utilities should “plan for grid expansion” over the next decade to accommodate the growing need for electric vehicles.

The tensions put BC Hydro in a particular bind, says Mark Zacharias, special adviser for Clean Energy Canada, a Simon Fraser University think tank focused on the transition to green energy.

“The reality of the situation is that the government is not on track to meet its climate targets,” he said. “Hydro can only look at the regulations that are in place, or they think will be in place.

“They’re hemmed in.”

What would BC need to meet its climate targets?

B.C. has an abundance of mostly hydro-powered electricity, but fossil fuels and gas make up the bulk of the overall energy supply, from the gasoline in car engines to the gas heating and fuelling many of its industries and homes.

To avoid runaway climate change, energy systems like that of British Columbia need to change, according to the International Energy Agency, whose net-zero scenario details a general path to decarbonization by 2050. All new buildings must be electrified by 2030, and more than half of all new cars must be electric. By 2040, half of all existing buildings will need to scrap fossil fuels. B.C. hasn’t done this kind of analysis within its own borders. Nor has it forecasted how much electricity a net-zero plan would require.

“To my knowledge, B.C. has not published projections of what electricity capacity will be needed to meet our climate targets,” said Kathryn Harrison, a political scientist at the University of British Columbia.

Instead, the provincial government has pointed to external studies that have found B.C.’s electricity supply needs to double.

BC Hydro, however, is planning for much less power. Its “reference scenario” — the forecast it deems the most likely to happen — anticipates sluggish demand growth from the beginning of its planning horizon in 2029, with a roughly 27 per cent increase in electricity consumption by 2050. Its most ambitious “high load” forecast predicts a 31 per cent increase in energy demand by 2050.

BC Hydro cites various phenomena for that modest forecast, including global economic uncertainty, a changing climate and oscillating climate policy.

“We have to predict the future, but we can’t actually predict it,” BC Hydro chair Glen Clark recently told The Tyee. Clark added that the current plan allows the utility to “look at a lot of options that we can ramp up quickly or slow down depending on what’s happening with the market.”

But those options no longer include a path to achieving the province’s climate targets.

For example, BC Hydro no longer models the power it would need to electrify existing buildings by 2050, narrowing its expectations to a smaller segment of new buildings in places where the province’s voluntary, net-zero building rules have been adopted. Similarly, none of its scenarios predict B.C. will substantially electrify commercial and industrial vehicles by 2040, focusing only on electrifying light-duty vehicles.

But if B.C. gets on track with its climate targets, it will need more power sooner.

Meanwhile, other power-demand wild cards could further unseat the utility’s predictions.

That includes climate-induced drought and its effect on BC Hydro’s shrinking reservoir levels, a trend that flipped B.C.’s status from a longtime power exporter to a net importer in 2023 and 2024. In its energy plan, BC Hydro acknowledged those levels can fluctuate almost as much as four Site Cs’ worth of power.

LNG presents another grey zone: if B.C. electrifies the power-hungry LNG production and liquefaction process, as it has committed to do, that alone could consume roughly 70 per cent of the province’s entire energy supply, according to a 2024 report from Clean Energy Canada. It’s unclear whether this will happen: groups like the International Energy Agency predict a major LNG supply glut in the coming years.

“Canada is late to the party, and that party is almost over,” said Steven Haig, policy adviser for the International Institute for Sustainable Development, in a recent CTV article.

Artificial intelligence data centres could also consume significant amounts of power — or very little, if the AI boom goes bust. B.C. has also recently implemented caps on electricity provision for AI centres to moderate that demand.

So far, BC Hydro is hedging its bets. Despite Eby’s recent comments on CBC’s Early Edition that the forthcoming Ksi Lisims LNG project “will be electrified,” BC Hydro did not factor the project’s pending power needs — roughly the size of the Site C dam — into its forecast. It also excluded demand spikes from other forthcoming projects, like LNG Canada Phase 2 and Cedar LNG.

To help lure LNG facilities to the province, B.C. and the federal government offered companies subsidies, including for more than $1 billion in transmission and other infrastructure costs for LNG development. It’s possible, says Lee, that the utility will also be persuaded to cover the cost difference between LNG operators burning their own supply of gas in their operations and using BC Hydro’s electricity. Lee’s recent research suggests LNG producers would need at least an 80 per cent discount off the cost of Site C’s electricity to equal the cost of burning gas.

Lee says BC Hydro’s customers could end up shouldering the cost differential through their power bills — rate increases that could put B.C.’s electrification goals even further from reach.

BC Hydro’s financial conundrum

B.C. has relatively cheap electricity prices — less than half the global median, according to Clean Energy Canada.

But those prices are thanks to a legacy supply of hydro-power dams that are expensive to build but cheap to run. BC Hydro’s recent $16-billion dam-building effort, Site C, indicates that its future efforts will be more expensive.

To get more power, BC Hydro is looking elsewhere.

So far, BC Hydro’s most recent electricity purchase acquired energy from independent power producers selling wind and solar — currently the world’s cheapest source of electricity. Those projects will supply power for less than the cost to build and operate Site C. To balance out the variable production depending on the relative abundance of sun or wind, BC Hydro plans to leverage its vast reservoirs as storage systems and to invest in batteries, the cost of which has also dropped precipitously, by 90 per cent in the last 15 years.

But even with those low power prices, BC Hydro’s finances offer little room for extravagance.

As is common for utilities, BC Hydro used debt to cover the costs of its dam-building efforts. Less commonly, BC Hydro piled copious amounts of those debts into 29 special accounts that allow it to delay payments far into the future. That has left the utility one of the highest debt loads among Canadian utilities, leading the auditor general to express repeated alarm.

Harrison can understand BC Hydro’s caution against overspending lest it “be caught holding the bag for the expensive projects that the government doesn’t follow through.”

That means it’s up to the government to fix the “missing link” between B.C.’s climate targets and its electricity supply, said Harrison.

“We need government to be more transparent and put in place the process to ensure that there will be sufficient electricity capacity in place to meet our climate commitments,” she said.

“The government is the one that will be accountable for that.”

Opportunity costs

Harrison warns against the steep costs of inaction. “I think there’s a much greater risk that we will undershoot the capacity we need than oversupply.”

“If we don’t produce clean electricity, then we won’t reduce our emissions,” she said. “People will burn gas.”

In its plan, BC Hydro acknowledged that the risks of undersupply outweigh the consequences of buying too much power. Zacharias echoes that concern, adding that a shortfall could dampen B.C.’s economic prospects.

“B.C. has an opportunity to produce massive amounts of very cheap power,” he said.

“It’s our secret sauce competitive advantage.”

Zacharias said renewable power could attract new industries to B.C. or the government could sell it to places like Alberta, which faces high electricity prices and a fossil-fuel-heavy grid.

Cross-provincial trade could also save BC Hydro money by helping to balance power demand and reduce costs on energy storage and transmission. Currently, Alberta’s power system constrains energy trade between the provinces, but efforts are underway to unblock it.

To make those economic opportunities a reality and hit the province’s climate targets, Jack Magnus, Clean Energy BC’s director of engagement and operations, said his organization and its First Nations and industry members want to see a clearer path forward in BC Hydro’s energy plan.

“It takes lots of time to build trust and to plan these large projects,” he said.

“It’s important to have a scenario that accurately reflects what success looks like.”

With files from Tyler Olsen.

[Top photo: BC Hydro has curbed its expectations on the rollout of commercial and industrial electric vehicles, focusing instead on light-duty and personal vehicles. Photo by Tyler Olsen.]