In December 1900 City Engineer Andrew L. McCulloch (not the McCulloch of the Kettle Valley Railway) and Mayor Houston made a trip to Bonnington Falls, exploring a site on the south side of the river above the West Kootenay number 1 plant. The City of Nelson was deeded 40 acres on the south side of the river at Bonnington as a power site. With this came a token water licence of 1000 miners’ inches of water or 28 cubic feet per second, much to the chagrin of Lorne Campbell and the West Kootenay Power and Light Company. On March 6th 1904 Mayor Jim Hamilton applies for and is granted a licence at upper Bonnington Falls for 50,000 miners inches, or 1400 cubic feet per second. This brings the total licence to 1428 cubic feet per second, at least three times the capacity of the Cottonwood Falls plant. The municipal council in January, 1905, engaged Mr. Clemens Herschel of New York to design the Power House and the construction was supervised by City Engineer A.L. McCulloch, commencing on April 3, 1905. This original design was to accommodate a total of four units.

January 27, 1907 the new City Power Plant with Generating Unit 1 (750 kW), successfully started operations. All the city lights, except those on Baker Street not previously on the West Kootenay Power and Light Company, came from the City Plant. The remainder was cut in the next day, except for the tramway which was held over until the plant was in perfect running condition.

The use of electricity quickly grew and Unit 1 was soon nearing its capacity to keep up. September 17 1908 voters of Nelson approve a by-law of $85,000 to provide for a second unit at the Bonnington Falls Generating Station plant. Ballot count, Yes votes: 1976 No votes: 24.

Unit 2 (1000 kW) commenced operating on June 1, 1910, at 1:15 p.m.

No major changes were made during the First World War, but as soon as peace came, the North Shore began to agitate for electric power, resulting in a successful by-law for supply to Willow Point in 1923, and eventually to Woodbury Creek to serve the Kootenay Florence Mine. By 1928 the plant had again reached its generating capacity, and a by law was prepared to ask Nelson voters to approve the construction of a third unit at Bonnington. The voters approved, and construction began.

Local Mr. Joe Irving was among the workers on the construction of Unit 3, a young lad at the age of 17 who started his life-long career as an ironworker on this project. The economic benefits of the city-owned utility were listed in a talk that long-time city clerk, W.A. Wasson gave in 1937.

In 36 years of operation of city-owned power plants, $2,776,191 had come to into the city coffers, allowing for such “luxuries” as cheap electricity, the Civic Centre, and the stability of the city finances. By the end of the Second World War, the city was again at the limit of its power generation, and a by-law was passed in 1946 to add a fourth unit of 6,500 horsepower.

The new unit was opened by Mayor Thomas Waters on December 7, 1949. Earlier in 1949, the controller of water rights of B.C. had written to the City suggesting that in view of the possible effects of developments on the Columbia River, Nelson might want to consider the usefulness of an additional 1,400 cubic feet of water over and above its existing license. The City replied that indeed it would like to apply for the additional water, but was advised that the fee for such an application would be about $2,500 and that a refresher fee would be required every six months until the license was issued. Furthermore, a licence could not actually be issued until the water came available some years later. 

The City agreed to leave the matter in abeyance. In 1956, the City applied again and was told that an Order in Council in 1955 had put a reserve on all available water, but needs would be noted for the future. Applying again in 1962, Nelson received the devastating news that a license had now been issued to B.C. Hydro, giving the corporation the rights to store water at the Duncan River, and receive all the downstream benefits. Now, no new licence could be issued to Nelson without consultation with other licences. To cut a long story short the city came close to losing the Plant in the early 1970s because of the construction of BC Hydro Kootenay Canal Project. Land expropriation and loss of water use were the main issues, thanks to the hard work of opposition parties in Victoria and at home, a settlement was made and the City Plant continued to operate at a reduced capacity once the Kootenay Canal Project was completed in 1975. In 1988 the City plant received an additional 265 cubic feet per second of extra water on their license, which would allow Unit 2 to run again. This unit had been shut down since the Kootenay Canal Project was completed.

In 1993 the voters of Nelson approved a record $8.75 million bylaw to build a new Power House and generator just downstream of the old Plant. This was done to remove Unit 2 (1910) and Unit 3 (1930) from full-time use, and to maintain that the Licensed Water was being used efficiently. Unit #5 is quite different from the other units, in that its main shaft runs horizontally rather than vertically and the turbine is a Kaplan type which resembles the propeller of a ship. The blades on the turbine change in angle via computer control to make the most efficient use of the water at a wide range of power outputs, anywhere from 1000 kW to 7000 kW. The turbine receives its water through a 100-meter-long tunnel that was drilled and blasted through the solid rock up to the existing forebay.

The powerhouse is built of concrete and approximately half of its height is located below the water level. This is done to decrease the effects of cavitation on the turbine.

Generator 5 was completed in June 1995, with a rated capacity of up to 7500 kW. It is now possible to perform repairs and maintenance on other generation units and still maintain the licensed total output.