Deja vu all over again

I am enjoying most of the discussion on the NB Power issue (with the exception of some of the funky stuff that I have had to block).  I am surprised at the visceral reaction to this – people talking about sovereignty, and constitutionality and arguing it is a point of pride to have crown ownership of the power company.  And the issue of the Premier breaking a promise – that so outraged the folks calling into the CBC this morning – all politicians change their minds.  Have you ever witnessed one that didn’t?

I have to admit this is strange to me.  This should be debated on its merits no question but this other stuff is bringing a weird level of emotion, feelings and pride into it.  People are acting like their feelings have been hurt by this.

The telephone company is not a crown corporation anymore.  PetroCanada was sold off.  The electricity utilities in PEI, Nova Scotia and Newfoundland and Labrador are owned by the private sector.  Where was the outrage?  The constitutional rights debate?

Why would people care who owns the utility?  Again, the case needs to be made one way or the other but if the average resident in New Brunswick or the average business recieved lower rates and rate stability who would care about the ultimate ownership?

I understand that ownership is a part of this and the debate should be had but this visceral reaction crowds out serious debate. 

Ask yourself if deep down you really care who owns the electricity utility.  I realize there are folks that want to score political points and others who dislike certain politicians and others who just like to fight the power but ask yourself if you really deep down care as long as you get good service at a reasonable cost.

And as to the deja vu reference in the title – remember back to the toll highway debate in New Brunswick. Some of the biggest public voices against the NB toll highway were coming out of Nova Scotia and PEI – two provinces with significant toll highways already in place.  Now voices from those provinces (and NL) are also speaking up – some of the stuff in the Chronicle Herald is downright angry – against the deal as if their own electricity utilities were owned by the crown.  They are not.

Instead of all this righteous indignation over New Brunswick looking to sell its power company the same way they did years ago – maybe they should provide some reflection and insight into what went right and what went wrong.  When Nova Scotia sold off NS Power in 1992, what learning should New Brunswick take into its discussion with HQ?   Beyond that, the sniping is just bad form in my opinion.

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29 Responses to Deja vu all over again

  1. richard says:

    ” some of the stuff in the Chronicle Herald is downright angry”

    And also funny. Some of the ‘outrage’ in NS is apparently because they have been planning a ‘Maritime Energy Strategy’ involving tidal and other renewables. I don’t recall much discussion here in NB about this – I assume NS was going to let us in on the secret at some point (oh yeah, NB, BTW, we’re gonna need your transmission lines, but at a price we like – and you believe regional cooperation, dontcha?).

    I’d guess that a lot of the gut reaction around the proposed sale is that, here in NB, people feel that they do not much control over anything – industries are given tax dollars, then bugger off; people work hard, then get laid off. The citizens own NB Power, and do not want to give up one of the few things left that they feel they own.

  2. richard says:

    ” some of the stuff in the Chronicle Herald is downright angry”

    And also funny. Some of the ‘outrage’ in NS is apparently because they have been planning a ‘Maritime Energy Strategy’ involving tidal and other renewables. I don’t recall much discussion here in NB about this – I assume NS was going to let us in on the secret at some point (oh yeah, NB, BTW, we’re gonna need your transmission lines, but at a price we like – and you believe in regional cooperation, dontcha?).

    I’d guess that a lot of the gut reaction around the proposed sale is that, here in NB, people feel that they do not have much control over anything – industries are given tax dollars, then bugger off; people work hard, then get laid off. The citizens own NB Power, and do not want to give up one of the few things left that they feel they own.

  3. Anonymous says:

    This is an economic development blog so let’s look at the deal from that point.

    The deal buys a few more years of life support for dying traditional industries that have failed to transform themselves and will never be able to compete with the cheap fiber and cheap labour in South America.

    It will help some other industries with their profitability. I doubt that any existing businesses will plan expansions and add jobs based on this deal. It may preserve jobs for a temporary period.

    The wild card is will any energy intensive industries newly locate here? I have not seen many ideas on this as yet so it is a possibility but an unknown.

    What we do know is this. Quebec Hydro will not be investing in Lepreau II, and other major upgrades that have provided many jobs for engineering, construction and service firms. These jobs have allowed NB companies to develop experience that has won projects in other provinces and countries. For example, Neill and Gunter (now Stantec) who led the Coleson Cove scrubber project won a major contract to lead the Nanticoke scrubber project. The Lepreau experience that many NB companies are gaining will present export opportunities as the other CANDU reactors are refurbished. Quebec Hydro will, over time, utilize their own suppliers causing some NB business to lose business locally and not have a chance to develop experience to win export projects (not anti-Quebec, just what taxpayers would expect in any province). Additionally, there will be some job losses at NB Power else the deal has built in inefficiencies and redundancies that reveal yet another flaw (do we need the same number of managers and employees to run an organization that is 25% of its original size?). There has not been analysis on the impact of the losses to NB business but I expect that the magnitude will shock some people. When NB Power spends $750 million on a scrubber project, most of the money is spent on NB engineering, construction and service providers; this has positive economic impact that is not being considered in this deal.

    We are not talking about privatizing our utility; we are selling it to another province with their own agenda and responsibility to their electorate, not ours. NB Power is already an important economic driver and has underutilized potential to have a bigger impact. From an economic development perspective, we are giving this up to buy some time for some pulp mills.

  4. Claude B says:

    I share your view that this deal should be assessed on an economic basis, but let’s not kid ourselves. The political dimension is unavoidable.

    Some of the visceral reaction in NB has something to do with the identity of the buyer. The government knew full well of the uproar a sale to HQ would cause. And yet they were still ready to go ahead. That’s why they found a million bucks (a million in advertising goes a long way in New Brunswick) to sell the deal to the people.

    What is the trigger for this resolve from the Premier? The Irving positive take will undoubtedly strengthen Mr. Graham resolve (and his war chest for the 2010 provincial election), but there must be something else, something that must be dealt with now. In politics, you don’t do U-turns if it will cost you votes, less than a year before the next election unless this the lesser of two evils.

    There must be something pretty bad going on, something we’re not aware of. But what?

  5. Samonymous says:

    “I have to admit this is strange to me. This should be debated on its merits no question but this other stuff is bringing a weird level of emotion, feelings and pride into it. People are acting like their feelings have been hurt by this.”

    That’s a real good point, David. It reminds me of an exchange that happened between newly elected leader Shawn Graham and just retired/defeated Liberal MP Ann McLelland at a Canada 2020 policy gathering in Montreal in Nov 2006. Graham was fresh off a victory in which he ran on the slogan “Charter for Change.” As he ended his speech/pitch on how NB will become “self-sufficient” by 2026, the attention quickly turned to the floor. A few lob ball questions were presented before McClelland jumped in and said, “as a NBer I’ve witnessed how government after government in my former province have dragged their fellow citizens through these hopeless government led processes, all the while, while falsely raising their expections. In the end, I witnessed how the public’s self-esteem d\bottom out after they were ultimately let down. So why is this any different? And if not, do you risk permanently damaging the public’s positive “collective conscience” for years to come?”

    Well, I remember the look on Shawn Graham’s face. For a split moment, he was speechless. Funny thing is, Ann McClelland was right. When you raise the hopes of NBers and then let them down once again, their faith in government and the province grows thin. I think that’s part of the reason we’re witnessing such anger over the sell off of this utility. They now know that this “self-sufficiency” ship is adrift.

  6. Samonymous says:

    “The electricity utilities in PEI, Nova Scotia and Newfoundland and Labrador are owned by the private sector. Where was the outrage? The constitutional rights debate?”

    Well, it’s a bit different, that is why. Most private companies are within the borders of the jurisdiction they’re operating in and pay taxes and are regulated by the rules and laws which that state or province decide on. However, as my good friend Alec Bruce brought to my attention, the royalties earned by the assets in NB owned by HQ will flow entirely to Quebec coffers. So their isn’t much to gain down the road if you give them away to another government to control.

  7. I guess I need to be a little more clear on this. There are a number of people that I respect and agree with 95% of the time that are adamantly opposed to this deal and seem to be no matter what. So my question is this. If an independent auditor that everyone agreed with came down and decreed that this sale would be in the best interest of New Brunswickers would you (they) still be against the deal? Is there some greater public interest that I am missing here? To me NB Power is an electricity utility that started to go off the rails with the initial nuclear reactor because they didn’t start to pay down the debt in alignment with the wearing out of the asset. Then Belledune was built against the recommendations of the board itself (as I understand). Then Chavez decided to back out of our orimulsion deal (no signed contract if you recall) costing the province somewhere between $700M and a billion. I don’t claim to be an expert in the history and development of NB Power but it seems to me that the model is not working. I want to know if there is some greater good or public interest that needs to be factored in rather than just an economic analysis.

  8. mikel says:

    The point is that in politics there is no ‘best interest’ for everybody. How many political decisions have won EVERYBODY over? It’s been shown that accidents are prevented when governments introduce laws against using cellphones. It’s really a no brainer, but in the end, you don’t get to talk while driving.
    And remember that before now there has been no internet and no facebook. If you don’t think people were pissed when they sold NBtel you’re crazy. But this is New Brunswick, where if Irving doesn’t agree with your view, it doesn’t get printed. So really, where exactly would you SEE the outrage? Heck this is Canada, Tim Hortons became so popular simply as a place for people to meet and gripe about their politicians-it sure wasn’t for their lousy coffee and donuts.
    I can understand being surprised, but remember the anger that was shown by people when the principal stopped having the national anthem every day? For some of us most of this is an academic exercise-or like I said, would be if it weren’t so blatantly anti democratic. The argument that ‘well, politicians ALWAYS lie’ isn’t an excuse to suddenly be complacent. In fact its a HORRIBLE thing to say, and I suggest you don’t let your kids see this because like another guy said-no wonder people don’t vote. Its GOOD that when people get angry they try to do something about it, and just look at the facebook group grow.
    And like I’ve shown, and as said above, on economic grounds this can easily be shown to be a bad deal-so its no surprise people get upset. It’s true and unfortunate that SOME people are upset just because its Quebec and they don’t like the french, I’ve seen lots of that bigotry first hand, but that really is the minority here. But I will admit that I tried to get a discussion going at the facebook site on the NB Power financials and alternatives, and there hasn’t been a lot of takers. However, for many people its ‘one thing at a time’. Keep in mind though that people are different, don’t you get emotional about your family…your house….your community? This is a PUBLIC utility,which means the public OWNS it. For some that makes no difference, but its easy to understand why to some people it would. I suspect this is more ‘I can’t believe people are getting so emotional AT ME’, which is understandable, because there are so few places where people can actually get angry and KNOW that somebody is noticing:) So at least you are also providing a valuable cathartic purpose!

  9. Anonymous says:

    Yes David. The political interference that you refer to is a major factor in NBP’s less than impressive performance. Despite that, we still have competitive power rates; not the lowest but far from the highest.

    That is exactly why this deal is such a cop out. The government is basically admitting defeat and confessing, no, we are unable to allow NBP to operate as a business and not interfere so we’ll hand it over to another government and let them try.

    To be fair, we definitely need a revised (ie less fosssil plants) NBP model on the table for comparison and David Hay and his team should be challenged to produce it. Unfortunately, with the Liberal chairman in place, the script is well defined.

    Do you find it ironic that there were dozens of task forces, committees and consultations on every trivial topic from moose fencing to school bus routes but something as major as the sale of NBP comes out of the blue with an artificial urgent deadline to accept it? Do you find it strange the Chairman of the NBP Board has not commented on the sale of the corporation he and his board are responsible for? Where is the CEO of the corporation? In hiding after he read Moe’s script?

    You are correct that there is more to the story. I am sure you have read other blogs where rumors are rampant as to why eg the refinery. Just look how policy has been strangely influenced already; imagine a Liberal government reducing taxes and clamping down on social programs. Is that not the definition of Conservative politics? We may never know the true motivation of such a deal. You are correct that politicians never fall on their sword and there is a lot at stake here; they either mis calculated the massive rejection of the deal or there is more to the story.

  10. Samonymous says:

    “If an independent auditor that everyone agreed with came down and decreed that this sale would be in the best interest of New Brunswickers would you (they) still be against the deal?”

    As far as I know, the New Brunswick Auditor general works objectively from an independent standpoint. I think it was a couple of years ago they were adamant about how most NBers, and businesses, were being grossly overtaxed for years. This didn’t change your position on economic development being, first and foremost, a government initiative solved mainly through regional development agencies as opposed to tax cuts for individuals and businesses spurring on growth. So why a different set of rules when an audit shows something that supports a particular argument you happen to agree with?

  11. Anonymous says:

    The usual abnegation about doing something well ourselves, like successfully managing our own power utility, is ongoing while we are in awe of the idea that someone ‘from away’ will once again save us. Afterall, they must be smarter than us if they are not from here.

    There has been much fanfare about 28% increases over 4 years (thank you David). Here is another way to look at it.
    Over the period in question, oil rose from about $25USD bbl to $85 depending where you draw the lines. So while fuels costs rose over 300%, this “albatross” of a power utility managed to keep rate increase to less that 10% of fossil fuel increases. Just imagine the performance potential if we were to afford our own utility the same luxury we are willing to afford HQ; remove the politically-motivated fossil plants from the books (coleson Cove excluded) but allow someone else to keep the lights on just in case they are needed. Oh yes, if they are needed, the extra generation costs will be passed on to the consumer. Oh, and when carbon credits sort themselves out, they get the value when closing the plants.

    I completely understand why there is a gag order on NBP. If they were allowed to defend themselves and present a plan with the same opportunities afforded HQ, there would not be much to debate.

  12. richard says:

    ” I think it was a couple of years ago they were adamant about how most NBers, and businesses, were being grossly overtaxed for years.”

    Where can I find this report? Got a URL?

  13. Rob says:

    “And remember that before now there has been no internet and no facebook…But this is New Brunswick, where if Irving doesn’t agree with your view, it doesn’t get printed”

    That right there is the biggest factor in this plan. If the internet and Facebook didn’t exist, you would think that there was absolutely no public outcry. Brunswick News can’t be expected to report that thousands of people have outright rejected this deal right out of the gate. The story has already fallen off the front page, and they’re now discussing credit rating agency reactions on page A3. Hardly representative of what’s really being said.

    Yet, every time I log on to Facebook, another three or four friends have joined the “NO to NB Power Sale” group. This comes up on my news feed every time I log on, which is free advertising for the anti-sale crowd. The group has already organized a march on Fredericton, and has outed more than a few paid Liberal staffers posing as “undecided concerned voters”.

    The difference between the two scenarios above is that people who are upset about the deal can easily find out they are in the majority. While the traditional media has moved on to H1N1 and Anne Murray signing books, the people have found a way to organize and discuss without political leadership. This deal and the associated roll-out would have been grudgingly accepted in 1999, but not in 2009.

  14. richard says:

    “There must be something pretty bad going on, something we’re not aware of. But what?”

    That’s a good question. But perhaps they just need to reduce debt in order to borrow more bucks. More bucks means more infrastructure spending = buying more votes next time around.

  15. mikel says:

    I’d almost suggest that this is one side of the Irving family trying to prove to the other side just how much clout they have. The lumber side of the family has always been mad at the energy side for the LNG deal tainting the Irving name, this is just to show that one side of the family has as much clout in fredericton:) If you think that’s far fetched, you’ve never been inside politics:)

    But seriously, to defend David’s position I don’t quite understand the above criticism. I do somewhat think that David is a bit frustrated of years of yelling from the wilderness and now it appears that ‘at least they are doing something’. I think there was similar thinking when there was a couple of blogs on the french immersion legislation-not so much support of the deal, but support of the ‘something’. If I could read the future I would actually THANK Graham because he’s made my new job MUCH easier. NBers DO need shaking up, particularly about energy-and the economy stupid.

    And thats not surprising, even ‘bad deals’ can be seen to ‘make sense’. I have an old worthless car I hardly use, and if somebody gave me 2 grand thats more than its worth. But I DO use it sometimes and would then have to rent a car. So how do you decide? In business you quickly find out that there is NO WAY to actually decide between options because you can only pick one, and since time moves on, the conditions are never present again. Renting may cost me more in the long term, but what if the old car breaks down?

    Why this is too bad is because some are calling for a referendum on the SALE of the asset. That’s too bad, in a functioning democracy YEARS ago people would have been voting on whether to break NB Power into multiple entities, what percentage of power to provide by new renewables and the time frame and even investment costs. What effect THAT would have we don’t know, but contrary to the above that would be MORE political involvement. I don’t think that Lord told NBPower to switch to orimulsion, that was a deal that ‘made sense’ at the time, then fell through for reasons beyond their control.

    By the way,for proponents there is finally a facebook group of people in SUPPORT of the deal. Since the government DOES pay attention to such things, I’d suggest joining. Several tory MLA’s are members of the group opposing the deal, they will have a MUCH harder time switching their vote in the house.

    Its a different kind of political interference though, more like public control, which is what a public utility SHOULD have. I certainly dont’ mean day to day operations, but general questions. Richmond, BC was the first canadian municipality to introduce citizen initiatives, and the FIRST citizen initiative that succeeded was to raise taxes specifically to replace their aged water system. The tax went directly to that project (not to ‘general revenue’) and now they have one of the best water filtration systems on the continent. The people VOTED to raise taxes.

  16. Bill says:

    I’m not sure what media outlets people have been reading or listening to but I’ve seen and heard quite a few that have been negative regarding this deal. btw … as far as I can see, in order to comment on the Facebook page against the deal, you have to “join,” which suggests you are against the deal. You therefore see few posts and comments debating the question. You could say it’s a bit of Internet flim flam. I know a lot, if not most people, are against the deal. But I wouldn’t be overly swayed by anything I see online.

  17. richard says:

    “But I wouldn’t be overly swayed by anything I see online.”

    I think that is a good point. Facebook and other social media are really more for reinforcement than discussion.

    Although there has been a lot of hot air on this issue, there has been very little nuts and bolts offered. A number of questions raised re what is in or not in the MOU have not been dealt with. Graham will have a hard time saying the deal must be done now, when he has been saying everything is hunky-dory with NBP until a few weeks ago. The official opposition has been vocal but I have yet to see any meaningful plan to deal with NB Power’s problems: does Alward et al have a plan to deal with Dal, Belledune, Coleson, Lepreau? Do they have a financially reasonable plan to promote wind and tidal power? If an election is called and Graham is thrown out, does anything really change? The mess will remain; the accounting for it is just delayed.

  18. Anonymous says:

    Alward does not need a plan for Belledune etc. As the owner of a Crown Corporation, they should be providing direction and guidance to NB Power and setting priorities. He should be developing an energy policy and mandating NB Power to comply with that policy.

    When you meddle in the detail instead of allowing the people you hired to manage the business, you create a mess. For example, Belledune was built because of political interference.

    What the government should be doing is directing NB Power to set strategic goals. For example:
    – reduce fossil fuel generation to XX %
    – reduce GHG by XX %
    – be in the lower quartile for industrial power rates in the country
    – increase renewable energy generation to XX %

    Of course they need to work with NBP to establish reasonable objectives, but micro managing will not work. Either fire the management and run it yourself or allow the people you hired to do their job.

  19. mikel says:

    Facebook is more for ‘organization’ which is what is happening. If you want to ‘discuss’ the deal, anybody is free to open up a group for the sole purpose of discussion. The name of the group is people AGAINST the sale, so discussion is moot. There have been a few posts on the wall, unfortunately for the ‘pro’ side they have been far more inflammatory than even some of the ‘con’ side. It does seem that the democratic angle has been quite popular there, people feel betrayed and lied to, and thats more HOW the decision was made rather than the ‘deal itself’. So its hard to sell a deal when you’ve botched it so much from the start. Once you start lying to people, its hard for them to know when your not.
    And actually there IS a lot of discussion on the deal itself, thats why such organization is good. There are lots of people who have gone through the MOU line by line looking for ammunition to criticize, and thats good because it brings it out in the open.

    And again, its unfair to call on the tories and say ‘you’ve got no alternatives’. That’s misleading. They don’t NEED an alternative. From a certain point of view, wind power is already starting to get ramped up, 2009 is supposed to provide as much wind energy as would come from Dalhousie and there are hardly any turbines. So by some measure the status quo is NOT as unresponsive as some may believe. It could easily be better, NB Power itself could invest in wind turbines instead of waiting for others. But ALward can’t be criticized for not having a policy when this decision was so suddenly sprung on everybody.

  20. Anonymous says:

    SO, here is a simplified version of the deal.

    We give up our revenue generating assets with an unspecified value but we know it is something beyond $5 B. The 2008 annual report lists the assets at cost at $7B. Add the Lepreau refurbishment (accounted for in the debt) and you are at a asset value (at cost) approaching $10B. Factor in the market value and it is most likely in the $15 B range. If the government was smart enough to have a market evaluation done for the assets, they have keep it secret so far. (BTW, would anyone sell their house or without first determining a market value?)

    For that, we get $5 B in potential rate savings over the next 5 years (debatable). Residents realize somewhere south of $0.50 B (this would assume everyone heated by electric so it is a high number). The remaining savings of $4.5 B are enjoyed by high energy users. We don’t know exactly who those are but it would include the Irving Pulp Mill and the Fraser Mill. Not sure how many more but it would be a very exclusive club, maybe 6-10 ?

    After 5 years, there are lots of mechanisms for increases. Rather than use the fear factor that QH will immediately try to recoup their investment, let’s give the benefit of the doubt there will be compassion and they hold increases to levels that NB Power could achieve. That nets out the deal after year 5. This is over simplified I know as projections are we will be exceeding our negotiated limits at year 5 so the power beyond that is in a new rate class not subject to this deal.

    The 3% residential energy savings are not going to change my life, or most other New Brunswickers. Think about it, we just had a 2% HST reduction that would exceed the annual power rate savings for most people; did it change your life? Existing energy intensive industry enjoy rate relief. So, we give up the assets of NB Power and we get rate relief for Irving and Fraser. We sell perhaps $15B in assets for $5B and give up direct control of our energy resources to achieve $4.5B in rate relief for our pulp mills.

    I am a supporter of big business but not to this level. Just how is this a good deal for “the people of New Brunswick”?

  21. richard says:

    “But ALward can’t be criticized for not having a policy when this decision was so suddenly sprung on everybody.”

    That is patently ridiculous. Go to the PCNB website and check out the banner in red showing the provincial debt growing by the second. Look at their press releases. If the Opposition is going to call for an election, then they have a responsibility to provide their plan to deal with NB Power’s problems and the growing debt load. It foolish to think that the status quo can prevail given NBs current fiscal situation and the outlook for the next decade.

    “Facebook is more for ‘organization’ which is what is happening”
    Thanks for agreeing with me. Social media are not for discussion, they are for reinforcement.

  22. Anonymous says:

    There is a difference between unsecured debt from overspending and debt secured against assets. Think of having a .ortgage versus a credit card debt.

    Yes, NBP has debts but they have revenue generating assets. The debt to be concerned about is over spending. The current government overspent by at least a billion this year alone and none of that will result in revenue generation in years to come. Unless of course toll roads are back on the table.

    BTW, the heros at HQ that are about to save us have about the same debt load as NBP adjusted for population.

  23. richard says:

    “NBP has debts but they have revenue generating assets. ”

    It is not of course just about the current debt, but what the future is likely to hold. NBP has Lepreau and fossil fuel plants on its plate. Hydro plants need repair. The only real asset seems to be the transmission grid, and only then if it is distributing power into the US. What will be the costs to power consumers in NB to pay for the cost-overruns and shutdowns of those plants. What will be the cost of replacement power (wind, tidal, reneable, etc)?

    Some have speculated that Graham et al have received from very scary news either re NBP debt or GNB debt and perhaps have been frightened into this deal. Regardless, the economic future for NB looks pretty bleak. NB has been mis-managed for decades and the bill is mounting. Misguided tax cuts, pandering for votes, always taking the short-term approach, etc, all these have gotten us in a big mess. Neither an election nor a referendum nor a protest march or three will change that.

  24. Anonymous says:

    Lepreau will be good for 25 years when the refurbishment is complete. Mactaquac is good for another 20 before needing replacement. Just how long do you think an asset should last before you reinvest or rebuild?

    Don’t fool yourself. HQ will have some big bills down the road for replacement and refurbishment.

    You raise exactly the point many people are making; we have not seen a revised plan for NB Power that removes the political handcuffs of things like Grand Lake, Belledune and Dalhousie. Let’s see that plan. Right now we are blindly just giving up on our utility and taking the first deal that comes along that appears to be an easy escape.

    Graham likely has received scary news. You cannot continue cutting taxes and spending a billion more than you collect. However, if the answer is to start selling assets to pay your debt, we might as well cut to the chase and just sign over the province to someone willing to take us.

  25. richard says:

    “just sign over the province to someone willing to take us.”

    Since we have botched things up so well, perhaps that isn’t a bad idea.

    “Lepreau will be good for 25 years when the refurbishment is complete”

    Ha ha. Bridge in Brooklyn anyone?

    “Mactaquac is good for another 20 before needing replacement”

    Have you been to Mac recently? They are patching it up on a yearly basis. And do I need to mention the fossil fuel plants again? NBP has few assets apart from the transmission grid and its customer base. Those are what HQ is paying for.

    “Graham likely has received scary news.”

    On that we agree. Wonder what is was? Lepreau can’t be fixed? GNB debt climbing much much faster than forecast? Bad news from Harperites re transfer payments? Inquiring minds want to know.

  26. Anonymous says:

    Lepreau is of course viable and will be running. If not, we can forget the $4.75B in cash involved in this deal. The MOU specifically references the withholding of funds for Lepreau until it is tested, running and licensed.

    Your comments regarding Lepreau are unfair, offensive to the NB Power workforce and a product of media rhetoric.

    The 600 professionals at Lepreau have done an excellent job with the reactor. In the early days, for a 10 year period they ran at 90% capacity factors and have been over 80% the last 10. They have an excellent safety record. Their expertise is highly respected and is consulted by CANDU operators throughout the world. The Lepreau effectiveness has been a gem for New Brunswick and we can be thankful we had it (especially when oil was at $140 bbl).

    The negative aspect of Lepreau is the unreliable construction schedule. This construction is led and managed by AECL. The cost over runs are the responsibility of AECL. NB Power pays for replacement power which they would have to do anyway if we did not have Lepreau. I would agree that AECL has been less than impressive. However, when Lepreau starts back up,it will be a tremendous asset. I have full confidence that the employees will deliver another 25 years of outstanding performance. If you want to take cheap shots, take them at AECL.

    Yes, I have been to Mactaquac. Yes, you do need to do maintenance on hydro facilities. Yes, as you reach end of life maintenance increases. End of life is 20 years away.

  27. richard says:

    “Your comments regarding Lepreau are unfair, offensive to the NB Power workforce and a product of media rhetoric.”

    First you praise the NB Power workforce, then you condemn AECL. Kindly make up your mind – I was talking about the refurbishment and you are introducing a red herring. NBers are paying for the replacement power; the cost overruns are substantial. Who will pay them is up for debate. GNB is threatening lawsuits, so the case cannot be as clear as you claim. Then we will have to pay for closing and containment. Sounds like a white elephant to me, quality workforce or not.

    “End of life is 20 years away.”

    And how many billions of dollars away. The cost is not just the cost to repair the infrastructure; its also the cost of replacement power. All of which will be done with borrowed money.

    NB Power has aging ‘assets’, a sizable debt, and is unfortunate enough to be located in a province with an anemic growth rate and its own substantial debt load. Both NB and NBP are going to have more and more trouble servicing that debt. That means large cuts to govt services.

  28. Anonymous says:

    Agreed. We can afford the size of government that we have nor the level of service we are offering.

    Not sure if you are being sarcastic or do not understand but NB Power has contracted AECL to do the refurbishment. They are two seperate crown corporations. Any cost over runs are the responsibility of AECL. NBP has to buy replacement power while AECL is finishing the job.

    It is a red herring regarding NB Power’s market. If NB does not buy it, we sell it to the highest bidder for profit.

    Regarding the maintenance costs, once again we are in agreement. We need a long term plan fron NB Power. We should not just accept the first and only offer. I would be even more concerned about the QH debt at $36B. There extra costs will affect our rates.

    There is a fund that is paid into for closing costs. If you read the MOU you will see it gets transferred to QH too.

  29. mikel says:

    Again, you CAN afford the level of services and the size of government IF you follow responsible taxation policies. Don’t you find it odd that just before an argument about debt the provincial government reduces taxes? And reduces taxes to the wealthiest? What evidence is there that corporations are beating a path to NB’s door to take advantage of those low rates? They were simply aimed at those making over 100 grand and the Irvings and McCains.

    This is the same thing Reagen and Harris did, you lower taxes so that things start to crumble, then tell everybody they have to ‘live within their means’. Canada wouldn’t even have a deficit if GST hadn’t been lowered.

    But again, the ENTIRE debt of NBPower can be simply put in with the government’s general debt and NB would be no worse off than Nova Scotia or PEI or Manitoba. Here in ontario they are talking about a 20 billion dollar DEFICIT, and if you think that means ontario hydro is going to get sold forget it.

    IF they did that, NBPower would be debt free, and could offer those low rates people are talking about as well as make other investments. Nova Scotia can’t do that, they are still paying on almost a $2 billion dollar debt for a utility they don’t even own anymore (that may not even be included in their total debt which would put NS’s debt even higher than NB’s).

    Like I said, I have a beat up old car. It doesn’t run great, but it does run, and it makes me money. To badmouth all the assets like they were nothing makes no sense. The St. John pulp mill is ancient, but it still FUNCTIONS. The Mactaquac dam is WORTH what the power it creates is worth (at least), and thats quite a bit. A little bit of repair on it each year is nothing.

    As for facebook, a new group called ‘low rates nb’ has been set up ‘for discussion’. And people are free to ‘discuss’ as much as they want. I’ve gotten more information from facebook than I have from this website, but that doesn’t mean Davids site is ‘not for discussion’. It’s as much discussion as people want it to be.

    An interesting aside is that it MAY appear that the guy who started and moderates that site which is generally in support of the deal, actually works for Revolution Strategies-the marketing firm that Graham hired to help sell this. There are over 300 members now, but many of them are people from the no side seeing what they are up to, as well as people who have no idea that its to support the sale (because of course the rates aren’t actually ‘lower’ YET).

    On the ‘no’ webgroup has been a number of people who have opened up numerous facebook accounts and have been posting as different people. Say what you want about facebook, its where the real action on social issues is, not on blogs (which is both good and bad for David:)

    People in Canada have been screaming ‘unsustainable’ every time an issue comes up. There is no evidence for it, only ‘opinion’. If you happen to think there is no value to a bunch of dams, three thermal plants, a nuclear facility, etc., thats an opinion, not a fact.

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