Decision Date: February 5, 2019

Panel: Brenda Edwards

Keywords: Water Act – ss. 1 – definitions of licensee, owner, 7, 27; conditional water licence; dam; reservoir; undertaking

Clara London appealed a conditional water licence (the “Storage Licence”) issued by the Deputy Comptroller of Water Rights (the “Deputy Comptroller”), Ministry of Forests, Lands and Natural Resource Operations, to the BC Hydro and Power Authority (“BC Hydro”). The Storage Licence authorized BC Hydro to store water in a reservoir created by a dam on the Peace River. It was issued together with another licence that authorized BC Hydro to divert and use water from the Peace River for power purposes (the “Diversion Licence”).

Both water licences were issued as part of the Site “C” Clean Energy Project (the “Project”). The Project will be located downstream of BC Hydro’s two existing hydroelectric stations and dams on the river. Before the water licences were issued, the Project was subject to environmental assessment processes, which resulted in the issuance of an environmental assessment certificate (“EAC”) in October 2014.

Specifically, the Storage Licence authorizes the storage of 165 million cubic metres of water in the reservoir in support of the power purpose authorized in the Diversion Licence. The authorized works under the Storage Licence are the dam, spillways, a reservoir, a shoreline protection berm, and ancillary works associated with the dam. The Storage Licence states that it is appurtenant to BC Hydro’s “undertaking” to generate power at the generating station authorized in the Diversion Licence.

When the water licences were issued, a permit over Crown land (the “Land Permit”) was issued under the Land Act by a different statutory decision-maker. The Land Permit authorizes BC Hydro to occupy 9,580.10 hectares of Crown land by flooding within the reservoir, and to place the licensed water works on Crown land.

Mrs. London appealed the Storage Licence on several grounds. She submitted that the ground in the Peace River area is unstable and prone to landslides, which makes the area unsuitable for a dam and a reservoir. She submitted that the construction and operation of the dam and reservoir poses a risk to private property, the environment, and public safety. She also argued that BC Hydro was ineligible to hold the Storage Licence because BC Hydro did not own all of the land that will be affected by the Storage Licence. She requested that the Board reverse or vary the Storage Licence.

The Board found that BC Hydro was eligible to hold the Storage Licence, because the Water Act did not require BC Hydro to “own” or acquire all of the land or land tenures needed for the Project before obtaining the Storage Licence. Section 27(4) of the Water Act provides that the holder of a licence that authorizes the construction of a dam “has the right to expropriate any land that would be flooded if the dam were constructed and utilized to the maximum height authorized.” Section 1 of the Water Act defines “licensee” to mean “an owner of any land … or undertaking with respect to which a licence is issued”. BC Hydro was the owner of an undertaking; namely, the Project. In any event, when BC Hydro acquired the Storage Licence, BC Hydro was an “owner of land” within the meaning of section 7(a) of the Water Act with respect to all of the Crown land, and most of the private land, needed for the Project, and it was continuing to acquire any additional private land rights it needed for the Project.

Next, the Board considered the environmental and safety risks posed by the dam and reservoir, including the risk of flooding caused by:

• dam failure or the slopes of the reservoir collapsing into the reservoir due to unstable soil in the area;
• landslides, including the potential for damage due to wave action or the reservoir flooding its banks;
• accumulated silt and sediment entering the reservoir and causing it to flood its banks; and/or
• cascading failure of a dam upstream of the Site C dam.

The Board considered a great deal of technical evidence, including numerous expert reports, regarding these risks and how BC Hydro would mitigate the risks. The Board found that the risks of slope instability, landslides, silt and sedimentary deposits, and the associated risk of flooding were the subject of extensive and ongoing study, and BC Hydro was required by its environmental assessment certificate and water licences to take numerous steps to monitor and mitigate those risks. The Board concluded that the conditions in the Storage Licence reflected a cautious approach to ensuring public safety and managing the risks associated with the construction and operation of the Project, which added to the requirements imposed in the environmental assessment certificate.

Although the stability of upstream dams was considered by the Deputy Comptroller before he issued the Storage Licence, the Board found that dam safety is regulated in other provisions of the Water Act and the Dam Safety Regulation. The Board held that the risk of upstream dam failure was being appropriately managed and mitigated through the environmental assessment certificate, and the oversight of Dam Safety Officers under the Dam Safety Regulation.

For all of these reasons, the Board dismissed the appeal.