New developments cannot threaten energy hub: Premier

FREDERICTON, NEW BRUNSWICK - Premier Shawn Graham sent a shot across the bows of his Atlantic Canadian counterparts, saying the other three provinces cannot simply expect to build new energy projects and then ship the electrical power to the United States through New Brunswick's power grid.

As well, Graham took what is his perhaps his most aggressive stance yet in dealing with the federal government. He referred to Ottawa as "Johnny-come-lately" in assisting energy projects in the region, while also questioning new funds he contends will help the other Atlantic provinces compete against New Brunswick in supplying power to the U.S.

"New Brunswick has been out in front on developing an energy hub for the past two years," he said in an interview. "Our government is not going to allow other jurisdictions to catch up to us (to the) detriment of what we're trying to obtain here."

Graham's comments came just days after Ottawa announced $4 million to support the development of renewable energy in Atlantic Canada, a move intended to help the East Coast tap a growing market in the U.S. northeast for hydro-, wind-, tidal- or nuclear-generated electricity.

The region's senior federal cabinet minister said the cash will help the region produce surplus power to sell to "energy-hungry" states.

"There is potential for Atlantic Canada to reap significant economic development benefits from the development and export of clean and renewable energy," said Peter MacKay, the minister responsible for the Atlantic Gateway.

MacKay said there are already proposed projects that could increase the output of renewable energy in the region and he suggested the federal money may assist with their completion.

For example, he pointed to Newfoundland and Labrador's hydro projects at Lower Churchill Falls.

The Newfoundland government's hydro corporation is currently in negotiations with several utilities in the Maritimes, discussing the possibility of bringing that electricity to the region via sub-sea cable.

Not so fast, Graham said.

The premier, at an event in Toronto promoting his tax reforms, said he was "surprised" by MacKay's comments.

While Graham said he will co-operate with Ottawa and the other provinces, he warned that New Brunswick won't be taken advantage of or pushed aside.

In a follow-up interview, he went further.

"That energy has the potential to flow through our province, but we want to make sure it doesn't jeopardize the projects that we're trying to achieve here," he said.

"The marker that we're putting in the ground is: we're not just going to (allow) the erection of lines for electricity transmission in New Brunswick that benefit other regions, but not (us)."

Graham said New Brunswick receives no benefit from offshore oil and gas resources held by Nova Scotia and Newfoundland and Labrador.

So, the province will use its location on the U.S. border in the same manner.

"We don't begrudge our sister provinces in the region" for having taken full advantage of their resources and their geographic location," he said in his speech to the Economic Club of Canada.

"But in New Brunswick, we are going to leverage every advantage we have to the absolute fullest.

"And since our geography is so advantageous to us" we are not going to give it up for another jurisdiction to simply run wires through our province.

"Our government will fight in the best interests of New Brunswickers to ensure we can take full advantage of what is rightfully ours."

Graham also highlighted a list of potential projects he hopes will result in an energy hub in the Saint John area. Irving Oil is planning to build a second oil refinery and is considering constructing a 1,500-megawatt power line to New England, along with facilities to generate power from wind and natural gas.

As well, the Graham government is bullish on a second nuclear reactor at the Point Lepreau Generating Station solely for exporting power.

But David Alward, the Conservative Opposition leader, said Graham is acting like New Brunswick is the only province eyeing new energy projects.

"Last time I checked, Prince Edward Island is a leader in wind energy and Newfoundland is certainly a leader in developing hydro energy," said the Woodstock MLA.

"I don't think you grow by tearing your neighbours down.

"It's quite a bizarre and short-sighted statement by the premier."

According to the federal government, total energy demand in the U.S. northeast is now 31,000 megawatts - a figure it expects to increase by more than 20 per cent by 2020.

The federal funds announced by MacKay are intended to help all four provinces tap that market.

MacKay said a new energy committee will be announced in the coming weeks. It will include representatives from all four provinces, as well as officials from the Atlantic Canada Opportunities Agency and Natural Resources Canada.

MacKay said he will also be inviting the four Atlantic premiers to an Atlantic Energy Summit to discuss their projects.