Change is constant and it can be very costly on a megaproject.
Oxford University professor Bent Flyvbjerg’s “iron law of megaprojects” theory says that megaprojects tend to be delivered “over budget, over time, over and over again.”
Take BC Hydro’s Site C dam, for instance. The BC Liberal government said in 2010 that it would cost $6 billion, later it ballooned to $8.8 billion. Further cost overruns were exposed by the B.C. Utilities Commission’s expedited review last year. When Premier John Horgan decided in December to keep building, he revealed the new cost of $10.7 billion. Higher and higher it goes. Where it will end, nobody knows.
Horgan vowed in December that a new board would offer “enhanced oversight” to keep the project under control. But the NDP government has not moved on promises to reform public disclosure laws, policies and procedures. Outlets like theBreaker are already aiming to provide the public independent “enhanced oversight” of public spending and policymaking. It appears little has changed at BC Hydro since the Horgan Horde took over from the Clark Clique last July.
On June 16, just four days after the Clark minority government’s post-election cabinet swearing-in, theBreaker asked for the Site C change order log, showing the individual cost changes to the project since Jan. 1, 2017. Change order logs are standard for any major construction project, and tell the story of how a project evolves.
On July 28, BC Hydro refused to release any of the records, because it feared undue financial loss or gain to a third party. theBreaker complained to the Office of the Information and Privacy Commissioner.
On Jan. 22, BC Hydro finally released 10 heavily censored pages. The Crown corporation continues to stubbornly withhold all the costs of each of the contract changes. theBreaker will continue to seek the full documents, because, on a similar case decided last October, the Office of the Information and Privacy Commissioner ruled that the government cannot withhold change order logs.
The documents obtained by theBreaker as a result of the decision showed another $11 million in costs, which cast doubt on BC Liberal claims that the troubled Millennium Line extension to the Tri-Cities cost $1.43 billion. The OIPC ruling said there was no legal basis for maintaining secrecy of costs from a negotiated contract. In fact, the lawyer representing the government favoured release. Only Evergreen Line contractor SNC-Lavalin opposed disclosure, but did not offer any evidence that disclosure would harm its business. (SNC-Lavalin, the scandal-plagued Montreal engineering and construction giant, is also a contractor on Site C.)
So what are some of the changes at Site C?
A budget transfer from procurement to construction management. An increase for the independent environmental monitor. Transfer of staff from public affairs to environmental management and administration. A change to the contract value for the turbines and generators contract and a separation of the sub-project for the Generation Station and Spillway and Turbine and Generator. A radioactive pipe was disposed. A change to the Doig River First Nation burial site identification. And a contingency draw and budget transfer for the Portage Mountain Quarry.
Those are just the tip of the iceberg, as you can see from the documents below.
Were there any cost savings or did all of these contribute to cost overruns?
theBreaker will endeavour to find out and let you know.
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