Local officials in the Kootenays say communities have the resources to generate their own electricity, but are being blocked from doing so under current policies.

“So, essentially, they’re not able to operate,” said Aimee Watson, board chair of the Regional District of Central Kootenay (RDCK). “They have solutions, but policies and pricing prevent them from being solutions in their own communities.”

In a March 5 letter, the RDCK is calling on the province to review how small hydro projects are supported.

The issue reflects a broader challenge across B.C., where centralized power systems can be vulnerable to outages caused by extreme weather, geography and aging infrastructure. At the same time, electricity demand is expected to grow as more homes, vehicles and industries shift toward electrification.

Local governments say small hydro and other decentralized energy sources could help improve reliability by allowing communities to generate power closer to home. But they argue the current system is not designed to support small or remote producers. 

Watson says many communities in the Kootenays are surrounded by creeks that could support micro-hydro generation, offering both a stable local power source and an economic opportunity. 

But she says pricing remains a major barrier. 

“The rate that is available to purchase that power is much less than the actual cost of producing it,” Watson said. “Those rates may work at a certain scale, but they don’t work for small and remote communities.” 

The Village of Slocan, a small community in the West Kootenay region, began developing the Springer Creek micro-hydro project more than a decade ago, and by 2017 had secured permits and federal funding and applied to B.C. Hydro’s Standing Offer Program. 

The Standing Offer Program, which allowed small producers to sell electricity to B.C. Hydro at fixed, long-term rates, was later cancelled as part of a provincial review aimed at reducing electricity procurement costs and keeping rates affordable. 

Without that agreement, the project was halted in 2021.

Watson says similar challenges have affected businesses in the region. 

Some mills have tried to generate their own electricity to maintain operations during frequent outages, including investing in solar energy.

“They invested in solar and then were unable to sell back into the grid,” she said. 

Officials say those limitations are affecting both local energy production and economic development in rural communities. 

Silversmith Power & Light, a run-of-river hydroelectric facility in Sandon, B.C., has been operating for about 129 years. It is one of the last locally owned utilities of its kind in the province. 

The issue was raised in the B.C. Legislature on April 15, where Abbotsford South MLA Bruce Banman warned the facility could be at risk of shutting down within months. 

Banman said the utility is facing challenges related to pricing and long-standing land issues, and argued the situation reflects broader concerns about how small, local power producers are supported in the province. 

Energy Minister Adrian Dix responded that B.C. Hydro’s role is to act in the public interest and keep electricity rates affordable, adding that contract negotiations with independent producers are ongoing. 

In a statement, B.C. Hydro said it manages the cost of power it purchases from independent producers, and looks for opportunities to reduce those costs in order to keep electricity rates affordable. 

Watson says without changes, those challenges are likely to continue. 

“Geographically and technically, they could do it, but they’ll never get the rates to pay for the system. It stops it at the door,” Watson said.