The BC Utilities Commission has announced that it will be holding a Community Input Session at 1 p.m. on Saturday, Jan. 13 at the Fireside Inn Hotel in Castlegar, regarding the proposed sale of the Waneta Dam. (Trail Times file photo)

Dam meeting in Castlegar on Saturday

BCUC will hold a Community Input Session at 1 p.m., Jan. 13, in the Fireside Inn Hotel

More than $1 billion cash was going to exchange hands, no matter the buyer.

That said, Saturday is your chance to voice concerns about the impending sale of Teck’s Waneta Dam shares to BC Hydro.

The BC Utilities Commission is holding a Community Input Session regarding the proposed sale at 1 p.m. on Saturday, Jan. 13 at the Fireside Inn Hotel in Castlegar.

Trail Mayor Mike Martin says he will be attending as an observer to this part of the process.

“It is open to the public to make it possible for any community member to make an oral submission to the commission members,” he said.

“I don’t believe the commission will be responding to questions or making comment,” Martin explained. “It (is) for them to explain the process and hear from community members.”

Since the announcement was made in spring 2017, local concerns have been expressed about the long-term impact and sustainability of Teck as a major industry and employer in the area, as well as the potential impact upon the tax assessment base. The latter point is particularly concerning for Beaver Valley communities, as the Waneta Dam in located in Area A of the Regional District of Kootenay Boundary.


In early May 2017, Teck announced it had reached an agreement to sell its two-thirds share of the Waneta Dam and generating station to Fortis Inc. Teck Metals would sign a 20-year power lease with annual payments beginning at $75 million.

This was not a done deal, however, because of a previous Co-Ownership and Operating Agreement between BC Hydro and Teck.

When BC Hydro purchased one-third share of Waneta in 2010, the company negotiated a right-of-first offer on any future sales of Teck’s remaining two-thirds interest.

As a result of this agreement, Teck offered to sell the two-third interest to BC Hydro on substantially the same terms and conditions that it was prepared to sell to Fortis Inc.

BC Hydro released a statement later in May, saying the company had 60 days to review the transaction and make a decision. In August, the BC Hydro announced it would buy the remaining shares from Teck Resources for $1.2 billion cash.

The agreement, however, was subject to a number of conditions, including approval by the BC Utilities Commission.

Notably, Fortis Inc. will not walk away entirely empty handed.

“Under the Waneta purchase agreement with Fortis, Teck expects to pay Fortis a break fee of approximately $28 million,” Teck stated in an August news release.

The company also confirmed there were no material changes to the commercial terms of the previously announced Waneta purchase agreement between Fortis Inc. and Teck.

Under the BC Hydro agreement, Teck Metals Ltd. will be granted a 20-year lease to use the two-thirds interest to continue powering the Trail smelter, with the option to extend the lease for another 10 years at comparable rates.

Annual payments will begin at approximately $75 million annually and escalate at two per cent per annum, equivalent to an initial power price of $40/MWh based on 1,880 GWh of energy per annum.

Background from the BC Utilities Commission website:

• The Waneta Dam is a concrete hydroelectric dam located close to the Canada-US border, near the mouth of the Pend d’Oreille River just before it enters the Columbia River, near Trail, BC. The Waneta Dam was originally constructed in 1954 to generate power specifically for use at Teck Metals Ltd.’s (Teck) Trail smelter. Generating units at the dam have a capacity of approximately 490 Megawatts (MW) and they currently produce approximately 2,670 Gigawatt hours per year. In 2010, BC Hydro purchased a one-third interest in Waneta for $825 million (the Waneta 2010 Transaction). Teck remained the owner of the remaining two-thirds interest;

• As part of the Waneta 2010 Transaction, a right of first offer (ROFO) was established in regard to the subsequent sale by either party of their interest in Waneta, which permitted the non-selling party the first right to acquire the seller’s interest. In May 2017, following a competitive sales process, Teck informed BC Hydro that it had reached an agreement to sell its two-thirds interest in Waneta and related transmission assets to Fortis Inc. for $1.2 billion;

• On June 1, 2017, Teck delivered a Sale Notice to BC Hydro which provided BC Hydro with the opportunity to match Fortis Inc.’s offer and purchase Teck’s two-thirds interest in Waneta under terms substantially equivalent to the Fortis offer. On August 1, 2017, BC Hydro delivered a Reply Notice to Teck which, together with the Sale Notice, constituted BC Hydro’s legally binding election to purchase Teck’s two-thirds interest in the Waneta Dam and associated assets. Attached to the Reply Notice was an executed Waneta Purchase Agreement which sets out the sale by Teck and purchase by BC Hydro of Teck’s two-thirds interest in Waneta for $1.203 billion cash. The parties agreed that closing of the Waneta 2017 Transaction must occur by August 1, 2018;

• A key term of the Waneta 2017 Transaction is that the two-thirds interest in Waneta will be leased to Teck for a 20-year period (extendable to 30 years at Teck’s option) in consideration of lease payments from Teck to BC Hydro;

• Upon expiration or earlier termination of the lease, BC Hydro will purchase Teck’s transmission assets, including Line 71 (collectively, the Transmission Assets) for $20 million. After the lease period has ended, and after BC Hydro has acquired the Transmission Assets, BC Hydro will provide a transmission wheeling service to Teck between the US border and Teck’s smelter load, pursuant to the Teck Wheeling Agreement, as well as certain ancillary services, pursuant to the Waneta Interconnection Agreement;

• On November 24, 2017, pursuant to Order G-169-17, the Commission determined a public hearing is necessary for the review of the Application and established a regulatory timetable including intervener registration, one round of information requests and further process to be determined.

• On December 7, 2017, FortisBC Inc. (FBC) submitted a letter to the Commission requesting an extension of the deadline for intervener information requests. FBC further indicated it contemplates a second round of information requests and procedural conference will be required;

• On December 12, 2017 BC Hydro submitted a letter to the Commission supporting FBC’s requested delay, and with proposed dates for extension. BC Hydro further indicated its support for a second round of information requests;

• By letter dated December 14, 2017, the Commission extended the regulatory timetable further to FBC’s request, and to BC Hydro’s reply supporting the requested delay; and

• The Commission has determined that a further regulatory timetable for the review of the Application should be established including a Community Input Session and an extension to the deadline for intervener registration.

NOW THEREFORE the Commission orders as follows:

1. A further regulatory timetable for the review of BC Hydro’s Waneta 2017 Transaction Application is established as set out in Appendix A to this order.

2. A Commission-hosted transcribed Community Input Session is scheduled for January 13, 2018 at 1 p.m. in Castlegar at the Brit Fireside Inn Hotel & Conference Centre (Columbia Room) at 1810 – 8th Avenue, Castlegar, British Columbia. The Community Input Session is open to the general public and no registration is required.

3. Intervener registration is extended until Friday, January 19, 2018.

4. Interveners who wish to participate in the regulatory proceeding are to register with the Commission by completing a Request to Intervene Form, available on the Commission’s website at, by the extended deadline of Friday, January 19, 2018 in accordance with the Commission’s Rules of Practice and Procedure.

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