Long-awaited downtown Kelowna Tolko project’s first tenant will be a power substation — for West Kelowna

Kelowna has its first tenants for a new 40-acre plot of blank downtown waterfront canvas — a two-acre power substation.

It’s not quite the pop many envisioned from the once-in-a-lifetime opportunity for the city that opened up with the closure of a waterfront mill. Evolving into a bustling planned neighbourhood may take decades, but before it buzzes with hype and interest, it will be buzzing with transformers and power lines for the 3,500 anticipated lakefront homes — but also Westbank First Nation and West Kelowna across the lake, too.

Power is a sensitive issue in the Central Okanagan. The entire Westside needs a backup power source, in case the one source it does have is damaged in, say, a forest fire. Meanwhile, Kelowna’s rapid growth has already put pressure on the electrical grid in the region, and some developments have been slowed or stalled because of it.

It will be years before condos and storefronts fill the largely vacant Tolko land, but Kelowna’s power utility took the opportunity while it could as the region is increasingly pressed for electricity.

FortisBC said it needed the land to guarantee the 3,500 new homes on the long-awaited Tolko site get power, but it likely would have needed a new substation either way as BC Hydro builds toward a cross-lake connection for the westside’s backup power.

“To continue to meet future power needs, a new substation is required on the site,” spokesperson Gary Toft said in an emailed statement.

The entire site encompasses 40 acres of waterfront property, including an eight-acre plot behind the Manhattan Point neighbourhood. It’s on that property, furthest from the lakeshore along Manhattan Drive and the Okanagan rail trail, where FortisBC plans to build a new substation.

It’s roughly a block away from an established substation on Recreation Avenue and Richter Street. Toft said the older one could serve as a temporary connection for Westside power, but the upcoming Tolko site is FortisBC’s “preferred” option.

The location has one new city councillor questioning whether it’s the best use of prime Kelowna real estate.

“I do understand that Kelowna needs a lot more electrical power,” Coun. Davis Kyle said. “But it does seem frustrating to me it’s going to be taking away land in the highest-density part of the development, where there was a greater opportunity for park land or housing as opposed to a lower-density area with less people.”

While the design isn’t known, FortisBC is wary of costs associated with burying power lines, while it doesn’t typically build underground substations either. So, the two-acre plot in Kelowna’s next highly anticipated neighbourhood could also be home to a buzzing collection of electrical equipment geared toward powering the Westside.

It cost FortisBC $7.4 million, but Tolko wanted more. Toft said they couldn’t negotiate a price, so FortisBC stepped in to expropriate the two-acre plot instead, finalizing the deal this summer.

Tolko has now filed in court to challenge the payment, arguing it should have been more. It did not say how much it should have been paid, and FortisBC hasn’t responded in court. BC Assessment values the entire property, more than eight acres, at around $28 million.

According to city hall reports, Kelowna has anticipated a substation to be included in the project since 2024, but FortisBC doesn’t yet have a design or timeline for the project to be built.

City officials on both sides of the lake have voiced their desire for the lines to be buried, but Toft said that could be a costly commitment.

“Because those costs are ultimately passed on to customers through electricity rates, we place a strong emphasis on keeping energy affordable and carefully weigh whether undergrounding is the most effective way to serve our customers, and safely and reliably deliver the energy they rely on,” he said.

The Tolko redevelopment remains a couple decades away from its eventual completion, replacing an industrial engine at the centre of Kelowna with a densely-packed neighbourhood. For now, it is 40 acres of largely vacant land, with a smattering of relics as a reminder of the 80 years mill workers toiled on the Kelowna waterfront.