I suspect that energy will be a key part of the election. Maybe not to the extent that auto insurance was last time, but it does seem to be an issue. So, I’ll take an initial crack at what I have seen so far in this area.
Jiggered with the structure of NB Power a couple of years ago – somebody fairly senior at NB Power told me that this just added confusion.
Said the Point Lepreau refurbishment could not go ahead without Federal subsidies. Said this would push up power rates by something like 8% per year. The NB Power board recommended against it. Lord went ahead and did it anyway. Not that I disgree with doing it, I found it amazing but typical how the process played out.
The Orimulsion issue. No discussion needed here.
Now comes the time to pay the piper. No more delays. Rates are going up dramatically. However, Lord decides to rebate the NB portion of the HST on electricity bills to cushion the blow. Cost to New Brunswickers? Some have estimated this to be $50 million or more per year.
No interest in developing the McCully gas field into a economic develpment tool for that region.
No real interest in supporting Saint John in its desire to be an Energy Hub.
So, in a nutshell absolutely it seems there is no interest in using the energy industry in New Brunswick for economic development.
Then we have Mr. Graham’s plan. I won’t comment on it too much but I will react to one point in the media this a.m – Graham’s call for a feasibility study on converting Dalhousie to natural gas. This was called ‘foolish’ by the industry lobby and others. Over the life it would cost $1 billion more, the expert said.
Interesting. That’s just about how much Lord’s HST break on electricity will cost the province over 20 years. The difference is that Lord’s HST break is a political move with no direct economic benefit to the province and Graham’s is a move designed to open up Northern New Brunswick to natural gas in the hopes it may support economic development.
Do I like the Dalhousie/nat. gas thing? I don’t think I have the credibility to comment on it. Do I like the idea of a government thinking about energy as a tool for economic development – even if it requires some public cross-subsidization? Absolutely.
And before you get your hackles up, look at it from my perspective. From the perspective of opportunity cost.
Canadian taxpayers spend about $400 million per year on EI payments for northern New Brunswick. If things remain roughly the same (and they are actually increasing), that will mean about $8 billion over 20 years.
I am not an economist but there is at least $1 billion per year in Equalization that is going to subsidize northern NB because the region does not generate the tax base to sustain its public services. That’s $20 billion over 20 years (this is rising too).
Now, on top of that, the region is shedding population on a daily basis. Thousands of people gone since 1999.
And you are going to quibble about $1 billion spred over 20 years?
I would spend $10 billion over 20 years if it meant revitalizing that economy and reducing society’s $28 billion dollar deficit up there over 20 years.
It’s absolutely funny how we indignantly talk about the ‘cost’ of any ideas that are meant to stimulate economic development and don’t even mention the hundreds of millions more paid out in EI – so that people don’t have to work.
Priorities, folks. That’s what it’s all about. We have a government now that spends every spare nickel on health care (and HST rebates on electicity) and brags about it. Health care is an expense. We need a government that will spend a little more on investing in our future.