A new provincial law in British Columbia will require data centers and artificial intelligence (AI) firms to vie for electricity from B.C. Hydro. The competitive bidding process, initiated on Friday, enables B.C. Hydro to effectively manage the power grid concerning rapidly expanding high-load sectors like AI and data centers. Energy Minister Adrian Dix, during a recent news conference, highlighted the necessity for this process to prevent overwhelming power requests without structure, as per Charlotte Mitha, B.C. Hydro’s president and CEO.
The initial phase of projects will contend for 400 megawatts of electricity over a two-year span. Dix emphasized that this amount, equivalent to about 35% of the power from the Site C dam, is substantial and won’t restrict the industry. The bidding will be evaluated based on various factors, including data sovereignty, environmental impact, Indigenous community involvement, and pricing, to ensure that electricity is allocated to sectors that offer the most significant advantages. Canadian companies are expected to have a favorable position in this process.
Concerns have been raised about the potential impact of data centers on water supply due to their cooling system requirements. The B.C. energy ministry stated that projects promoting energy efficiencies, such as heat recovery and water-use optimizations, will be favored in the competitive process. Meanwhile, traditional sectors like mining, LNG, forestry, and manufacturing will continue under current procedures without the need for bidding. Existing advanced projects will be exempt from the new bidding rules.
The B.C. Conservative Party criticized the government’s “rationing” of electricity and the selection process that they claim favors specific entities. The party’s B.C. Hydro critic, David Williams, pointed out the challenges in meeting the rising demand for power due to inadequate generation and transmission infrastructure. The Conservatives warned that limiting electricity access could impede data center construction, increase costs for approved projects, and shift risks to ratepayers. The application deadline for the bidding process is March 18, with decisions expected by early fall.