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A victory for community power in Powell River (qathet)

The Powell River (qathet) Council of Canadians chapter is celebrating a major win for public interest and community power, after a ruling that struck down a deregulation request from a major multinational company.

Along with Energy Democracy for BC, the chapter made a submission to a BC Utilities Commission (BCUC) inquiry into whether Powell River Energy Inc. (PREI), the owner and operator of two hydroelectric dams on BC’s upper Sunshine Coast, should be exempt from regulation as a public utility. The two groups presented key arguments in favour of public regulation. 

PREI is a subsidiary of Brookfield Corporation, one of the world’s largest investment management companies. The company’s lawyers had argued that PREI should not be regulated as a public utility because the power it generates is not sold to the public in British Columbia. PREI sells electricity to another Brookfield-owned subsidiary, which in turn exports that electricity to the United States. PREI’s parent company is registered in the tax haven of Bermuda, meaning the profits made from PREI’s dams are unlikely to be subject to corporate tax in Canada.

On December 6, the BCUC issued their final ruling rejecting the company’s bid for deregulation. The Utilities Commission agreed with Energy Democracy for BC’s submissions that said the company should not be able to use its complex corporate structure to avoid regulatory oversight. As local Council of Canadians chapter chair Drena McCormack put it, “The BCUC decision can be seen as an example of where a small community can win despite the resources and influence of a large transnational corporation.”

To understand the significance of this victory, a little backstory is needed. The town of Powell River was initially built in 1911 as a company town centered on a pulp and paper mill—the first in western Canada, and once the largest in the world. The mill was built on the site of a forcibly displaced Tla’amin village called tiskʷat. The site was chosen for its proximity to valuable timber and potential hydroelectric power sources, and nearby dams were constructed to generate hydroelectric power for the mill.

In operation for over a century, the mill was supplied with hydroelectric power by two dams at Powell Lake and Lois Lake. In 2021, the mill was permanently shuttered by its current owner Paper Excellence, a sprawling multinational corporation that now controls the largest share of pulp production in Canada. Following the closure of the mill, PREI began exporting all the electricity from the two dams to the United States. For residents of the upper Sunshine Coast, the loss of mill jobs, the weakening of the local tax base, and the export of locally generated power were the consequence of decisions made by two enormous multinational corporations with no concern for their impact on the local community.

The local COC chapter’s intervention in the BCUC inquiry is part of its ongoing work in coalition with Energy Democracy for BC. A key objective of this partnership is to ensure that locally generated hydro power benefits the Tla’amin First Nation and the broader community in the qathet region. The Columbia Basin Trust offers a model that shows how this goal can be achieved. Enacted in 1995, the Trust has resulted in hundreds of millions of dollars flowing from hydroelectric projects in the Kootenays to local First Nations and other communities. The founding principle of the Trust is simple: people living in an area that has been negatively affected by resource development should receive benefits from that development, and this objective should be achieved by working in partnership with First Nations.

Key Points

  • The Powell River (qathet) Council of Canadians chapter joined Energy Democracy for BC in submitting arguments to a BC Utilities Commission investigation
  • The Commission agreed with the chapter’s position that local dam operator Powell River Energy Inc. should be regulated as a public utility
  • The chapter continues its campaign to ensure that the benefits of locally generated hydroelectricity are shared equitably with the qathet community and Tla’amin First Nation