Risky Gamble of Phasing Out Natural Gas in BC’s Power Grid
From Energy Futures Institute March 3, 2025
The BC Government’s CleanBC policy requires natural gas electricity generation to be phased out in pursuit of a greener energy future.
While reducing carbon emissions is an important goal, the timing and practicality of this shift raises serious concerns.
BC Hydro is already challenged to meet demand, having to import the equivalent of 2 Site C dams worth of electricity in each of the past two years at a cost of $1.4 billion (page 54) in just the last fiscal year. Continued reliance on imported electricity against a backdrop of rising trade tensions with the U.S., and growing electrification pressures, means that eliminating the option of natural gas backup from our power mix is risky and could be a costly mistake.
In fact, BC Hydro recently relied on the 275-megawatt natural gas-fired Island Generation facility near Campbell River to get through the February 2025 cold spell. It was also used extensively during the hot and dry summer of 2024. But under the government's policy, it won't be an option by October next year.
If BC Hydro needed this dispatchable power to maintain grid stability during these extreme conditions, how would it manage similar situations once all natural gas-fired plants are phased out?
Currently, a number of natural gas-fired facilities in BC can provide a combined total of 460 megawatts of on-demand electricity. Eliminating this capacity without a reliable alternative leaves the province vulnerable, especially if future electricity trade with the U.S. is disrupted.
BC Hydro’s Growing Reliance on Imported Electricity
In recent years, BC Hydro has been forced to import approximately 20% of its power—much of it from the United States. This is problematic partly because about 60% of U.S. electricity is generated from fossil fuels, meaning BC’s clean energy goals are effectively undermined by this dependence. Eliminating natural gas generation in BC does not necessarily reduce emissions; it merely shifts them (along with economic benefits such as tax revenue) across the border. This doesn't help the atmosphere.
Relying even more heavily on imports, especially in times of high demand, compromises energy security and economic stability. This risk was highlighted last year by the environmental advocacy group Clean Energy Canada, who cautioned:
“In the past, B.C. could rely on neighbouring provinces and states for electricity imports, but they are now also facing shortages. What’s more, importing just one Site C’s worth of electricity would cost B.C. ratepayers, or potentially taxpayers, around $600 million annually.”
In fact, as noted above, for the past two years BC Hydro has imported two Site C dams worth of electricity. In the last fiscal year alone, this cost $1.4 billion.
The Risk of a Trade War with the U.S.
Further complicating the situation is the growing threat of a trade war between Canada and the United States. Should tensions escalate, electricity imports could be at risk of tariffs, counter-tariffs, restrictions, or outright cutoffs. BC Hydro’s ability to rely on American power to bridge supply gaps would then be compromised, potentially leading to energy shortages and/or skyrocketing costs for consumers. At a time when global energy markets are volatile, reducing domestic generation capacity by removing natural gas could leave BC dangerously exposed to external political and economic pressures.
Low Snowpack and Hydro Supply Uncertainty
Adding to the risks is the current low winter snowpack. BC Hydro relies on snowmelt to refill its reservoirs, which are crucial for hydroelectric power generation. A below-average snowpack means lower water inflows, reducing hydro generation capacity and increasing reliance on imports. This is not a theoretical problem—it has happened before, and with climate variability, it will likely happen again. In dry years, BC has historically turned to natural gas-fired generation to compensate for reduced hydro output. Without this backup, the province could face energy shortages, forcing expensive emergency measures such as importing even more power from fossil-fuel-heavy grids.
Rising Electricity Demand from CleanBC Policies
At the same time, CleanBC policies are aggressively pushing electrification. The government mandates that 26% of all new vehicle sales must be electric by 2026, increasing to 90% by 2030. This target is the most aggressive in the Western Hemisphere, exceeding even California’s 68% mandate for 2030. By 2035, the BC and federal mandate is for 100% EV sales of new vehicles. Of course, this ignores the fact that EV sales plunged 48% in January 2025 in Canada with reduced availability of federal and provincial rebates. According to S&P Global "British Columbia's decline in market share signals potential challenges that the province will need to address".
If all personal vehicles in BC were EVs, we would need the equivalent of 2 more Site C dams worth of electricity just to keep those vehicles moving.
While the government and certain environmental groups point to the limited amount of electricity EVs will require by 2030, this obscures the fact the current BC mandate only rises to 90% starting that model year. Obviously, every year thereafter the market penetration of EVs would dramatically increase, along with the demand for electricity, as the vehicle fleet turns over.
Additionally, natural gas is effectively being phased out for residential and commercial heating. These policies will significantly drive up electricity demand, yet as noted BC Hydro is already struggling to keep pace. Removing natural gas from BC’s energy mix, when demand is already set to increase at a record rate, will put immense pressure on an already stretched grid. This risk has been specifically flagged by the North American Reliability Council.
A More Balanced Approach is Needed
Rather than eliminating natural gas-fired generation outright, BC should adopt a more balanced approach. Promoting energy efficiency, further diversification of electricity sources and investigating emerging technologies like small modular nuclear reactors and geothermal energy could provide cleaner, more reliable alternatives. In the interim, maintaining a strategic reserve of natural gas generation would ensure energy security, especially in years of low hydro availability or external supply disruptions.
Clean energy is the right goal, but pursuing it recklessly could do more harm than good. BC needs a pragmatic, reliable energy strategy—one that emphasizes reliability and affordability while working toward a lower-carbon future.