im

Affidavit #1 of Marc Eliesen

Affirmed February 14, 2016

No. S159064

Vancouver Registry

IN THE SUPREME COURT OF BRITISH COLUMBIA

BETWEEN:

BRITISH COLUMBIA HYDRO AND POWER AUTHORITY

PLAINTIFF
AND:

KEN BOON, ARLENE BOON, VERENA HOFMANN, ESTHER PEDERSEN also known
as Rachel Blatt, HELEN KNOTT, YVONNE TUPPER, JANE DOE, JOHN DOE and all

other persons unknown to the Plaintiff occupying, obstructing, blocking, physically

impeding or delaying access, at or in the vicinity of the area in and around the south

bank of the Peace River upstream (west) of the Moberly River, including the area in and
around the heritage site known as Rocky Mountain Fort
DEFENDANTS

AFFIDAVIT #1 OF MARC ELIESEN

I, Marc Eliesen, of 9294 Emerald Drive, Whistler, British Columbia, AFFIRM THAT:

1. I am a senior executive within the energy sector, and, as such, I have personal
knowledge of the facts and matters hereinafter deposed to, save and except for
information imparted to me by other people, in which case I believe the source of
the information to be reliable and I believe the information to be true.

2. I have had a lengthy and successful career in senior executive positions in both
the private and public sectors, Including the following:

President, International Power Development Group (1998-present)

Chairman and President, BO international Power Group, a joint venture of
Asea Brown Boveri Inc., Westcoast Energy Inc. and BO Trade
Development Go. (1994-1997)
President and Chief Executive Officer, British Columbia Hydro and Power
Authority (1992-1994)

Chairman and Chief Executive Officer, Ontario Hydro (1991-1992)

Deputy Minister, Ministry of Energy, Province of Ontario (1990-1991)

Chairman of the Board of Directors, Manitoba Hydro (1984-1988)

Deputy Minister, Ministry of Energy and Mines, Manitoba (1982-1984)

Chairman and Chief Executive Officer, Manitoba Energy Authority (19821988)

Deputy Minister to Premier of British Columbia, Planning Secretary to the

Cabinet (1974-1975)

Assistant Deputy Minister of Finance, Deputy Minister to Premier of

Manitoba, Planning Secretary to the Cabinet (1970-1974)

3. I have worked for seven governments in Canada, both federal and provincial, and
have been a Deputy Minister of Government for nine Ministers of the Crown. I

have held a partnership with the management consulting firm Peat Marwick
Stevenson & Kellogg (KPMG), and held the position of National Director of

Government Services. I have been a corporate director of many organizations

and businesses, including Suncor Corporation, Manitoba Hydro, Ontario Hydro

and BC Hydro.

4. I have obtained a Bachelor of Commerce degree in Economics at Concordia

University (1958-1962) and have undertaken post graduate work in Economics at
Carleton University (1962-1964).

5. I certify that I am aware of my duty as an expert witness under the British

Columbia Supreme Court Civil Rules to assist the court and not to be an

advocate for any party. The contents of this affidavit conforms with that duty. If I
am called on to give testimony, I will do so in conformity with that duty.

6. I have reviewed the Affidavit of Michael Savidant affirmed January 28, 2016, the
Affidavit of Michael Savidant affirmed August 12, 2015 and the Affidavit of
Michael Savidant affirmed February 13, 2015.

7. The historical review and analysis provided by Michael Savidant in his Affidavit
regarding the proposed development of Site C is deficient and thus

fundamentally flawed. Itfalls to provide the proper and comprehensive historical

context of BC Hydro's determinations regarding this project.

8. Michael Savidant indicates that BC Hydro adopted a five stage planning and

evaluation of Site 0 in 2004 as ifthis is when BC Hydro began considering the

project. This is misleading and thus renders the representations Michael Savidant
makes that this is a logical and fulsome consideration as without merit. This lack

of understanding of the historical context may be due to the fact, as disclosed in

Michael Savidant's resume, that following his employment with Enron Canada

Corporation, Michael Savidant commenced working for BC Hydro in 2004.

Michael Savidant may not be familiar with the efforts undertaken by BC Hydro
over a number of decades that refuted the feasibility of Site C.

9. Site C construction was first proposed for development by BC Hydro in the late

1970s and early 1980s. Following public hearings and a review in 1982 by the
BC Utilities Commission, the Commission determined that BC Hydro had failed to

adequately demonstrate that Site C was the best project from a provincial
perspective and that "conditional approval with the Certificate to be withheld

pending evidence as to need for the project and timing."

10. In the early 1990s, following further reconsideration of Site C by BC Hydro, I can
attest to the fact that as President and Chief Executive Officer, I released a public
statement on behalf of the Board of Directors of BC Hydro, that Site C would not
be developed in the future by BC Hydro. The reasons provided were related to
First Nations rights, economic, social and environmental factors.

11.Michael Savidant in his Affidavits itemizes numerous submissions made by BC

Hydro to the Joint Review Panel established pursuant to the Canadian
Environmental Assessment Act and the British Columbia Environmental

Assessment Act to justify the need for the project based on long term forecasts of
both the energy and capacity to meet its customers. The Joint Review Panel
released its Panel Report to the Minister and Executive Director of the

Environmental Assessment Office on May 1, 2014. The Panel Reportconcluded

that "the Proponent [BO Hydro] has not fully demonstrated the need for the

Project on the timetable set forth" and recommended that issues of project costs
and the need for the project be referred to the BC Utilities Commission for

detailed examination. To my knowledge, neitherthe Minister nor BC Hydro

referred the issues of project cost and project need to the BC Utilities
Commission.

12. In my opinion, the Affidavits of Michael Savidant do not demonstrate that the Site

C hydroelectric facility has been subject to an adequate level of due diligence

which would determine that the project is needed, that alternatives have been

adequately explored and that the timing of construction is appropriate. Neither

are Michael Savidant's assertions that the submissions to the Joint Review Panel
represent evidence of need consistent with the facts since the Panel concluded

the demonstration of need was not established, and the Panel did not conclude
that the time schedule is reliable or that the forecasts were credible.

13.As a general practice within Canada and the United States of America, all

proposed public and private electrical generation facilities are subject to rigorous
and open review at public hearings held by specialized regulatory tribunals to
assess whether they are necessary and financially viable. Rigorous review is
considered indispensable to reducing uncertainty and minimizing downside

financial risk. In the case of BC Hydro that risk is borne by the BC ratepayer. In
the past in British Columbia, regulatory hearings before the British Columbia

Utilities Commission were the method of subjecting proposed generating facilities

to review. In this case the Site C project was not subject to that review level and
that due diligence.

14.Absent appropriate standards of scrutiny, not only Is there a high risk that the
estimated construction costs and planned timing of the project will deliver
substantially Increased hydro costs for BC ratepayers, there Is also a high risk
that the Site C will cost much more than forecast to build and that the electricity It

produces will not be needed for many years after Its expected In service date.
This would further, and dramatically. Increase hydro rates to British Columbia
rate payers including residential, commercial and Industrial users.

15. Michael Savldant's alleged construction cost delays are effectively illuslonary
because he relies on an unsubstantiated need for the project based on long term
forecasts that have not been properly vetted. Delay of the project Is likely to save
British Columbia ratepayers more than the alleged estimated $420 million costs
itemized by Michael Savidant. This situation is Increasingly obvious given current
developments In load demand. According to BC Hydro's Fiscal 2016Second
Quarter Report, domestic demand has decreased by 1,740 gigawatt hours in
comparison with its service plan forecast for the year. As stated by BC Hydro,

"forecast sales in the large industrial and commercial categories have decreased
largely as a result of lower forecast customer load in the mining and pulp and
paper sectors due to metal mine closures, closure of a major pulp and paper mill

in July 2015 and lower commodity market outlook."

16. Proceeding with the Site C project without appropriate regulatory scrutiny is
highly Imprudent and It is my opinion that the construction of Site C should be
postponed until adequate regulatory scrutiny Is completed because of the
excessive costs to be borne by ratepayers Ifthe project proceeds under the
existing time horizon. In my opinion. It is imprudent to continue with Site C
construction at this time and it will continue to be Imprudent to construct Site C

until due diligence is performed on the cost of the project and need for the project
established.

17.The Auditor General of British Columbia has publicly identified an audit of the
Site 0 project to determine "whether 80 Hydro's recommendation and
government's decision to build Site 0 was supported by sufficient information and

analysis to demonstrate that it would meet government's economic, social and

environmental goals."
18. A list of citations is attached as Exhibit "A" to this affidavit.

AFFIRMED BEFORE ME in the

Municipality of Whistler, in the Province of

British Columbia, this 14*^ day of

February, 2016

MARC ELIESEN

A Commteoner for taking Oaths in and

for the i?rovince of British Columbia

This Affidavit is Commissioned by Jason Grati of Grati &Company, Barristers and Soiioitors
601-510 West Hastings Street, Vancouver, BC V6B 1L8 Tei: 604-694-1919 Fax: 604-608-1919

LIST OF CITATIONS

BC Hydro and Power Authority Quarterly Report Second Quarter 2015/2016

https://www.bchydro.eom/content/dam/BCHydro/customerportal/documents/corporate/accountabillty-reports/flnancial-reports/quarterly-reports/f2016-q2report.pdf
British Columbia Auditor General Performance Audit Coverage Plan 2015/2016-2017/2018

https://www.bcauditor.eom/sites/default/files/publlcations/reports/OAGBC_PerformanceAuditCoverag
ePlan_FINAL.pdf
Annual Report of British Columbia Utilities Commission 1982

http://www.bcuc.eom/Documents/AnnualReports/1982/DOC_41386_Annual-Report-1982.pdf

Report of the Joint Review Panel Site C May 1,2014 https://www.ceaaacee.gc.ca/050/documents/p63919/99173E.pdf

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No. S159064

Vancouver Registry

IN THE SUPREME COURT OF BRITISH COLUMBIA

BETWEEN:

BRITISH COLUMBIA HYDRO AND

POWER AUTHORITY
PLAINTIFF

KEN BOON, ARLENE BOON, VERENA HOFMANN, ESTHER

PEDERSEN also known as Rachel Blatt, HELEN KNOTT,
YVONNE TUPPER, JANE DOE. JOHN DOE and all other

persons unknown to the Plaintiff occupying, obstructing,

blocking, physically impeding or delaying access, at or in the
vicinity of the area in and around the south bank of the Peace
River upstream (west) of the Moberly River, including the area in
and around the heritage site known as Rocky Mountain Fort
DEFENDANTS

AFFIDAVIT #1 OF MARC ELIESEN

GratI & Company

Barristers & Solicitors

601-510 West Hastings Street

Vancouver, BC V6B 1L8

Tel: (604) 694-1919 Fax: (604) 608-1919

Jason GratI