NB Power 'albatross around the necks' of NBers
Published Tuesday November 3rd, 2009
Concern is growing that New Brunswick could lose its energy sovereignty in any deal for the assets of NB Power.
The proposed deal, which would wipe out NB Power's $4.75 billion debt and offer ratepayers $5 billion in savings, would give Hydro-Québec greater control of Eastern Canada's power grid.
But Brian Lee Crowley, former president of the Atlantic Institute for Market Studies, says "NB Power has been an albatross around the necks of New Brunswickers," and the agreement is a boon for the province.
"What this deal does is allow New Brunswickers to escape the consequences of poor management, which has plagued the utility for decades," Crowley said in an interview.
The dangers of NB Power's rising debt, future rate increases and dependence on high-cost energy sources far outweigh the potential threat to energy sovereignty, he said.
"We have to calmly assess the real risks and benefits," Crowley said. "There seems to be an exaggerated account of risk and no account of the benefits."
In an opinion piece published in today's Telegraph-Journal, Crowley and energy expert Tom Adams say the proposed deal between NB Power and Hydro-Québec "brightens New Brunswick's future."
"Consumers would reap huge savings while the province's public finances would be transformed for the better overnight," the opinion piece states. "NB Power's government-guaranteed debt, which Hydro-Québec is taking over, is about $12,600 per customer. That monkey will be off New Brunswick's back."
"People are quite right to be concerned (with energy sovereignty)," said Norman Betts, a member of NB Power's board of directors and an associate professor in the faculty of business administration at the University of New Brunswick
"In the short term the financial benefits can be measured quite easily - you can put pen to paper and do your analysis," he said.
"But there needs to be an informed public debate about the long-term benefits and long-term costs around issues like energy sovereignty."
The Conservation Council of New Brunswick says it would be easier for the province to reduce energy consumption and sell renewable power to the grid if NB Power remains a provincially owned utility.
"We need to keep control of the wires and electricity sales in the province in order to make a rapid transformation to a sustainable renewable energy future," said executive director David Coon.
Energy Minister Jack Keir dismissed concerns over the province's energy sovereignty.
"The government of New Brunswick has, and will continue, to set energy policy," Keir said.
"When we took office in 2006 we directed NB Power to put 400 megawatts of wind energy on the grid by 2010," he said. "We'll continue to dictate that kind of energy policy and make decisions on the energy sector in the province.
"The transmission system in New Brunswick is an open tariff system," Keir added.
"Anybody can bid on any capacity that is available, with the caveat that we want the most cost-effective and competitive electricity."
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And when exactly does this happen?
I know the Telegraph Journal doesn't think any of us are smart enough to understand the process, but we need to let the people decide based on fact.
And let's try to look beyond the 5 year mark; what will happen to our power rates then?
Couldn't agree more.
I understand the inflation rate is considered to be a “base” figure to which other costs can be added ,such as wind power or even the added cost of a Lepreau shut down. No politician is going to take responsibility for a needless increase due to the addition of wind or tidal power replacing hydro. So those things won't happen.
I've been around long enough to be suspicious of any political deal that is secretly and suddenly arrived at with a short window of acceptance.
What is the point of future investment in generation? NB won't see a dime of it. It all goes to Quebec. It's not like Quebec is going to reduce our rates because we added additional wind generation.
Would this even help us in any kind of cap&trade setup, either? NB doesn't own it.
After making a total mess of our energy system through dumb agreements like the ore emulsion deal (or non-deal) and refurbishing Point Lepreau, the real albatross, this band of geniuses is now set to sell off the farm. Is there nobody at NB Power with a brain in their head? After a series of crazy moves, we all know that Mr. Graham's gang is missing important brain cells.
If you were running a business and people performed like the government and NB Power, you're fire their a--! The next election can't come soon enough.