Energy has become a major contributor to the provincial economy. Since 2000, energy has overtaken forestry in revenue to the government.

Energy issues on the West Coast of Vancouver Island center around the development of additional energy sources, including "green" energy sources, for the growing energy needs of Vancouver Island, and the generation of energy for commercial export. The recent interest in exploring offshore oil and gas deposits off the west coast is an example of energy development for commercial purposes, with a goal of providing revenue for the province.

A federal ban on oil and gas exploration drilling off British Columbia has been in place for 32 years. Lifting this moratorium, as proposed by the B.C. government, is currently under debate in the province. (Several news items, above, refer to this issue.)

Vancouver Island power comes mostly from hydroelectric dams. "Green" power refers to energy generated from renewable energy sources, such as wind and solar power, geothermal, hydropower and various forms of biomass. Although only a fraction of the power needs of Vancouver Island are currently provided by green power sources, there is a growing trend in the development of this energy sector in British Columbia. In 2000, BC Hydro committed to meet 10% of increased demand for electricity by 2010 through a variety of new green energy sources.

For large scale energy development projects, the only financially viable way to engage with this sector is to sell power back to BC Hydro for a premium price as a partner independent power producer (IPP). These projects must be located in areas that are able to access the existing Hydro grid system. BC Hydro pays a premium for every MW hour that is produced, providing the financial incentive for these investments. To date, all the projects pre-approved for a partnership with BC Hydro involve well-established technologies utilizing resources such as small hydro and biomass. Wind energy, micro hydro (systems with an installed capacity of less than 2 MW), tidal current, geothermal and building-integrated photovoltaic solar options are being researched.

There is currently a surge of applications to Land and Water BC for river development permits - over 300 are currently pending in the province. BC Hydro received 70 green power project submissions from IPP's in response to its 2002/03 Green Power Generation Request for Qualifications process. In the past year, 8 micro-hydro projects have proceeded around BC, and another 12 are in the final process of meeting approvals and beginning construction.

There is concern about impacts to recreational use of rivers and streams, as water is diverted between the intake and the powerhouse; the river bed is never dry because IPP's are required to leave a percentage of Mean Annual Discharge in the river. However, the section of river in a dammed area often has very low flow and can be unrunable for canoes and kayaks.

BC Hydro has recently announced the projects that successfully bid into the 2002/03 Green Power Generation (GPG) procurement process. Four of these projects are within NTC traditional territory: China Creek Hydro Project in Port Alberni, Cypress Creek Hydro Project and the Ucona River Hydro Project in Gold River, and the Zeballos Lake Hydro Project. All projects must be operational by September 30, 2006.

Wind and wave technology are also renewable sources of energy which have high potential on the West Coast. Two potential wave energy sites were identified by BC Hydro's Cartography study; the one with the greatest potential located in Barkley Sound near Ucluelet. An independent company, Sea Breeze Energy Inc. is proceeding with plans to collect data to determine the viability of this site.