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New Brunswick government signs agreement to sell utility to Quebec

by admin November 3, 2009

New Brunswick government signs agreement to sell utility to Quebec

by admin November 3, 2009

FREDERICTON (CUP) &- The province of New Brunswick has signed a memorandum of understanding (MOU) with Quebec suggesting the sale of most of NB Power’s assets for $4.75 billion &- the entirety of the utility’s debt &- to Hydro-Québec, Canada’s largest generator of electricity.
The agreement, which was struck on Thursday, Oct. 29, is subject to legislation passing in the upcoming session.
Jordan O’Brien, director of communications for New Brunswick Premier Shawn Graham, says the sale of the Crown corporation will be a good thing for New Brunswickers.
“The Premier has promised in the past to do what he can do to keep power rates as low as possible,” he says. “This is a solution.”
The MOU stipulates that the current rates for power in New Brunswick will stay the same for the next five years. Following that, O’Brien says, numbers will go up by inflation, making the costs “significantly less than in the past.”
O’Brien says this will be a good thing for New Brunswickers.
“Every year from now until forever there’ll be big savings for New Brunswickers on their power bills,” he says.
According to the MOU, if the agreement comes to fruition and NB Power is sold to Hydro Québec, power rates will be frozen for five years. Following this, O’Brien says, rates will grow only by inflation.
“The average [annual] power rate increase has been 3.2 per cent,” he says. Under inflation, he says, it will be a rise of 1.9 per cent.
“NB Power will still be called NB Power; the offices and call centre will still be in New Brunswick,” he says.
The MOU states that Hydro-Québec will give jobs to the people currently employed with NB Power.
The agreement has sparked responses from the other provinces in the Atlantic region.
Matt Lumley, a communications advisor with the Nova Scotia government, says things are up in the air for his province.
“What this means for Nova Scotia is still something I think we’re all trying to figure out. This is an MOU at this point, so I think until all those things are concrete, anything you might say about it is somewhat speculative.”
He does, however, point out that Nova Scotia has legislation in place to prevent the same from happening in that province.
“We have laws that basically ensure that the utility can have very limited out-of-province ownership,” he says. “The other thing is, although we have a private utility, it’s regulated by the utility and review board &- anything the utility does is in the best interest of Nova Scotians. You can’t change electricity rates without their approval. It’s the same for large capital purchases.”
He says this safeguards Nova Scotia, and that “it could never happen, really. Nova Scotians would be able to weigh in on that.”
Newfoundland’s premier, Danny Williams, has been vocal about his opinions concerning the topic. Williams made his thoughts known in a letter to Graham on Oct. 28.
Williams’ letter begins by stating that he is disappointed that Newfoundland was not made aware of the extent to which New Brunswick’s negotiations with Quebec had reached.
He also expressed disappointment at the fact that Graham will not be attending the next Council of Atlantic Premiers meeting this month in Churchill Falls, N.L., at which the primary focus would have been “energy cooperation among Atlantic provinces.”
“I have great fears and reservations about the stranglehold that Hydro-Québec could put in place over the Atlantic region and I hope that you share this concern given your extensive statements on your desire to see your province as an energy hub,” Williams wrote.
Heather MacLean is the manager of media relations for NB Power; she declined to give a comment, except to say the company is “neutral on the activities.”
The New Brunswick legislature will reconvene on Nov. 17, and the sale of the province’s electric utility is expected to overshadow much of the session.
O’Brien says a committee will be struck then to look at the issue, and legislation will be brought to the table in late January based on the feedback of that committee.
The deal is expected to be closed by March 31, 2010.
“This proposed agreement is an exciting opportunity for New Brunswick, and in the public interest,” said Graham in a recent press release. “Homeowners will see rates much lower than under the status quo, and we will now share Quebec’s competitive industrial rates, which, coupled with our plan for lower taxes, positions us for significant economic growth. Moreover, the elimination of NB Power’s massive debt will help us attain self-sufficiency and relieve our children and grandchildren of this burden.”
Hydro-Québec was contacted but declined to give comment before the time of publication.
New Brunswick residents are encouraged to give feedback about the deal by going to lowerratesnb.ca or by calling 1-800-533-3086.

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FREDERICTON (CUP) &- The province of New Brunswick has signed a memorandum of understanding (MOU) with Quebec suggesting the sale of most of NB Power’s assets for $4.75 billion &- the entirety of the utility’s debt &- to Hydro-Québec, Canada’s largest generator of electricity.
The agreement, which was struck on Thursday, Oct. 29, is subject to legislation passing in the upcoming session.
Jordan O’Brien, director of communications for New Brunswick Premier Shawn Graham, says the sale of the Crown corporation will be a good thing for New Brunswickers.
“The Premier has promised in the past to do what he can do to keep power rates as low as possible,” he says. “This is a solution.”
The MOU stipulates that the current rates for power in New Brunswick will stay the same for the next five years. Following that, O’Brien says, numbers will go up by inflation, making the costs “significantly less than in the past.”
O’Brien says this will be a good thing for New Brunswickers.
“Every year from now until forever there’ll be big savings for New Brunswickers on their power bills,” he says.
According to the MOU, if the agreement comes to fruition and NB Power is sold to Hydro Québec, power rates will be frozen for five years. Following this, O’Brien says, rates will grow only by inflation.
“The average [annual] power rate increase has been 3.2 per cent,” he says. Under inflation, he says, it will be a rise of 1.9 per cent.
“NB Power will still be called NB Power; the offices and call centre will still be in New Brunswick,” he says.
The MOU states that Hydro-Québec will give jobs to the people currently employed with NB Power.
The agreement has sparked responses from the other provinces in the Atlantic region.
Matt Lumley, a communications advisor with the Nova Scotia government, says things are up in the air for his province.
“What this means for Nova Scotia is still something I think we’re all trying to figure out. This is an MOU at this point, so I think until all those things are concrete, anything you might say about it is somewhat speculative.”
He does, however, point out that Nova Scotia has legislation in place to prevent the same from happening in that province.
“We have laws that basically ensure that the utility can have very limited out-of-province ownership,” he says. “The other thing is, although we have a private utility, it’s regulated by the utility and review board &- anything the utility does is in the best interest of Nova Scotians. You can’t change electricity rates without their approval. It’s the same for large capital purchases.”
He says this safeguards Nova Scotia, and that “it could never happen, really. Nova Scotians would be able to weigh in on that.”
Newfoundland’s premier, Danny Williams, has been vocal about his opinions concerning the topic. Williams made his thoughts known in a letter to Graham on Oct. 28.
Williams’ letter begins by stating that he is disappointed that Newfoundland was not made aware of the extent to which New Brunswick’s negotiations with Quebec had reached.
He also expressed disappointment at the fact that Graham will not be attending the next Council of Atlantic Premiers meeting this month in Churchill Falls, N.L., at which the primary focus would have been “energy cooperation among Atlantic provinces.”
“I have great fears and reservations about the stranglehold that Hydro-Québec could put in place over the Atlantic region and I hope that you share this concern given your extensive statements on your desire to see your province as an energy hub,” Williams wrote.
Heather MacLean is the manager of media relations for NB Power; she declined to give a comment, except to say the company is “neutral on the activities.”
The New Brunswick legislature will reconvene on Nov. 17, and the sale of the province’s electric utility is expected to overshadow much of the session.
O’Brien says a committee will be struck then to look at the issue, and legislation will be brought to the table in late January based on the feedback of that committee.
The deal is expected to be closed by March 31, 2010.
“This proposed agreement is an exciting opportunity for New Brunswick, and in the public interest,” said Graham in a recent press release. “Homeowners will see rates much lower than under the status quo, and we will now share Quebec’s competitive industrial rates, which, coupled with our plan for lower taxes, positions us for significant economic growth. Moreover, the elimination of NB Power’s massive debt will help us attain self-sufficiency and relieve our children and grandchildren of this burden.”
Hydro-Québec was contacted but declined to give comment before the time of publication.
New Brunswick residents are encouraged to give feedback about the deal by going to lowerratesnb.ca or by calling 1-800-533-3086.

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