Future of the Columbia River Treaty A British Columbia Perspective 2014 PNWA Summer Conference Coeur d’Alene June 23, 2014 Kathy Eichenberger B.C. Ministry of Energy and Mines 1

Objectives Treaty overview BC’ s role Key elements of BC decision Next steps

3 Columbia River Treaty Significant flooding around the Columbia in 1948 and growing US power demand after WWII led to the desire for a water management agreement between Canada and the US Main objective: power and flood control in both countries Treaty was signed in 1961 and ratified in 1964 Diefenbaker and Eisenhower signing the Treaty in 1961 Treaty and Protocol ratified and proclaimed by Pearson and Johnson in 1964

BC Treaty Mandate Under Canadian Constitution: Federal treaty-making power Provincial jurisdiction of natural resources, including hydroelectric development 1963 Canada/BC Agreement transferred most of the Treaty obligations and benefits to BC BC Hydro is Canadian Entity to implement the Treaty Province of BC is the Canadian Entity for the disposal of the Canadian Entitlement 4

5 Key Provisions of the Columbia River Treaty Canada to construct 3 dams to provide 15.5M acre-feet of water storage  Duncan 1967  Hugh Keenleyside 1968  Mica 1973 US had the option to construct Libby dam in Montana –Canada made land available (42 miles) for the reservoir The Treaty continues indefinitely but can be terminated with at least 10 years notice (earliest in Sept 2024)

6 Treaty Power Provisions Canada operates 15.5 Maf for optimum power generation in Canada and US US delivers to Canada one-half the estimated US power benefits (Canadian Entitlement - CE) First 30 years of CE sold to a consortium of US utilities for US $254.4 M

7 Treaty Flood Control Provisions prior to 2024 The US bought 8.45 Maf of primary flood control up to 2024 for US$ 64.4 M Regardless of Treaty continuation or termination, assured flood control ends in 2024, changes to “Called Upon” Called Upon not well defined in the Treaty

Ministry of Energy and Mines led CRT Review for BC Coordination of provincial ministries and federal agencies Consultation with First Nations Engagement of Basin residents and local governments Technical studies and discussion papers Recommendations to BC Cabinet for decision 8

Current Benefits of the Treaty to the U.S. 9 Prevents of significant floods, loss of life, damage to property and infrastructure Increases power production Manages flows for fisheries enhancement, ESA Ensures relief during low flow periods and dry years Provides seasonal availability of water supply for irrigation, municipal, industrial uses Prolongs recreation season

Current Benefits of the Treaty to the U.S. 10 Favorable Commercial Navigation Conditions Predictable minimum flows to prevent grounding late summer releases in Canada for U.S. power supplemented by increased flows during dry years Limiting upper flows to prevent channel siltation and expensive dredging minimize transit delays due to high currents facilitates docking operations Minimizes impacts top navigation infrastructure

Current Benefits of the Treaty to BC 11 Canadian Entitlement  Sold on the market  Currently worth M/year

Provincial Decision 12 Released March 13, 2014 Generally reflects input from First Nations, local governments and public Decision to continue the Treaty and seek improvements within its existing framework 14 principles to guide BC in discussion of any potential Treaty changes

Provincial Decision - Principles 13 High level themes in principles: Goal is to create and share benefits equitably There is a lot of value from upstream regulation provided by Canada to a broad range of U.S. interests Treaty operations continue to impact Canadian basin residents and regional interests

Provincial Decision - Principles 14 Changing flood control in 2024 is a step backwards Risks and impacts of effective use of U.S. reservoirs Disagreement on interpretation of Called Upon Flood Control:  at what flood risk  which reservoirs  when to call BC is open to discussing alternatives

15 Provincial Decision - Principles Treaty should be adaptable to changing conditions Treaty already has flexibility to incorporate ecosystems - further improvements can be explored Climate change will make collaboration even more important BC is committed to continued engagement with First Nations and the public

Next Steps 16 Conduct valuation of full suite of U.S. benefits Pursue further modeling of potential BC ecosystem option(s) Collaborate with Canada on approach to any future negotiations Gain a further understanding of U.S. perspectives and next steps in U.S. process Explore options to increase benefits to both countries

17 Questions ?