A recent report issued by the Independent Power Producers Association of BC (IPPBC) in February 2010 presents some impressive economic projections for the renewable energy sector:
The study by PricewaterhouseCoopers LLP (PwC) reports that “independent power producers could grow BC’s economy by as much as $9 billion by 2020. IPP construction could support 87,000 person-years of employment for British Columbians over the next decade, and more than 9,100 full-time jobs for their operations and maintenance.”
It’s important to connect what’s happening with the renewable energy sector to the prospects of economic renewal for First Nation communities. It’s really quite exciting. Independent power producers in BC are legally obligated to consult and accommodate First Nations. Many of the new power generation projects will be located within the identified traditional territories of BC First Nations.
Certainly many First Nations will and already are benefiting from the employment and royalty benefits associated with having such projects built within their territories. However, an increasing number are seeing the bigger picture—the prospect of actually becoming owners of these assets.
Owning shares in a company that builds and operates a power plant makes available a long-term income stream that can far exceed those related to the historically offered benefits of employment and royalties. And purchasing equity does not preclude First Nations receiving those historical rewards as well. Let’s be clear: when a First Nation considers buying equity this does not require or imply they need to give up the idea of receiving royalties or other historically established economic benefits from IPPs.
Unlike royalty and employment agreements however, an ownership stake requires investing money and accepting the associated business risk of doing so and an increasing number of First Nations are opting to take this on. The idea, a simple concept, is for the IPP and the First Nation to share both risk and return. Hopefully more IPPs will view this as another tool for crafting mutually beneficial agreements with their First Nation partners.
The economic benefits aside, renewable energy is good for First Nations for a number of other reasons. Through participation is these projects First Nation communities are often able to achieve greater energy self-sufficiency and sometimes replace diesel power with local clean power. Generally these projects, such as low impact hydro facilities, have a lower environmental footprint than the conventional power production systems.
For more information on how Ecotrust Canada and its Aboriginal partners are supporting First Nation communities to realize these benefits go to www.regenerationfund.ca.
– Bill Girard
Program Director, Capital Management