BC Hydro has confirmed its $1.2 billion purchase of the Waneta Dam is a done deal.
The company said Thursday it had finalized the acquisition of Teck’s two-thirds interest in the Waneta Dam and Generating Station.
“The BCUC (British Columbia Utilities Commission) approved the application last week, confirming the purchase is in the best interest of BC Hydro customers,” said Chris O’Riley, BC Hydro President and Chief Operating Officer.
The transaction followed a thorough internal review by BC Hydro prior to it submitting an application to the British Columbia Utilities Commission, the release read.
“This purchase provides ongoing financial benefits to BC Hydro, helping to keep rates affordable for our customers,” said O’Riley . “Through a 20-year lease agreement with Teck, two-thirds will be leased back to Teck and one-third will continue to supply BC Hydro customers.”
Workers, local politicians, and the community-at-large were blind-sided in May 2017 when Teck revealed the company was selling its remaining interest in the 65-year old utility to Fortis Inc.
Cheap power from Waneta Dam has long been attributed to the sustainability of mining operations in Trail.
Employees and Trail residents were worried about the impact of the sale on the city and economy.
What happened next, is BC Hydro exercised its “right to first offer” over Fortis. The B.C. utility negotiated that right when it bought one-third interest of Waneta Dam from Teck back in 2010.
More than $1 billion cash was going to exchange hands no matter the buyer, so the BC Hydro option was considered much more palatable on the home front.
“Recognizing the fact Teck had put the Waneta Dam up for sale, the best possible outcome would be for the dam to be purchased by the province through BC Hydro rather than a private sector and unregulated entity,” said Trail Mayor Mike Martin after the sale was announced.
The Waneta Dam was originally constructed in 1954 to generate power specifically for use at the Trail smelter. Generating units at the dam have a capacity of approximately 490 Megawatts and currently produce approximately 2,670 Gigawatt hours per year.
“Congratulations to BC Hydro and Teck on the finalization of BC Hydro’s purchase of the Waneta Dam and Generating Station,” said Katrine Conroy, Minister of Children and Family Development and MLA for Kootenay West. “The terms of the purchase agreement will support jobs and economic development in Trail and the Kootenays, generate revenue for BC Hydro and ensure a long-term supply of clean, affordable electricity.”