Power deal bad for New Brunswick: coalition

NEW BRUNSWICK - A coalition opposed to the proposed sale of NB Power assets to Hydro-Québec says a new analysis shows it's a bad deal for New Brunswick.

The group, made up of about 20 business leaders, energy experts and former government employees, contends the benefits of low electricity rates do not adequately offset the loss of assets and loss of control of energy in the future.

It has sent a copy of its report and a letter to Premier Shawn Graham, calling on the government to abandon the plan.

"From my standpoint, losing control of your energy future is, in fact, worth... to me, there's no price I can put on that," said group member Bob Neill, a prominent Fredericton businessman, who co-founded the engineering firm Neill and Gunter.

The group does think New Brunswick should still work out a deal with Quebec - but one that would provide a guaranteed supply of electricity at a guaranteed price, which would benefit both provinces, he said.

As it stands, the deal heavily favours Quebec, said Neill, who held a news conference to explain the group's position, along with former NB Power executive Frank Ryder and former deputy minister of Transportation Lyle Smith.

In the short-term, New Brunswick would pay a stable rate for electricity, Neill said.

For Quebec, however, it would be an immediate windfall because the power grid between the two provinces can only handle about 85 per cent of the power needed, he said.

The rest would come from New Brunswick generators, which Quebec would own.

"They can produce it for $2.35 and they sell it back to us for $7.35. And that's why they make 12.8 per cent on the deal," said Neill.

The long-term scenario is even worse under the deal, he said.

Although New Brunswick would own distribution and management of NB Power, the reality is that Hydro-Québec would have control of future energy decisions in this province.

"Would you rather have those opportunities being decided upon in Quebec, or would you rather have them being decided here in New Brunswick? It's that simple."

The group has recommended Graham instruct NB Power to undertake negotiations with Hydro-Québec to arrive at a firm power purchase agreement.

"It can benefit both provinces and continue our good relations in the future," it stated in its letter.

"We also recommend that your government undertake to develop a clear energy policy for New Brunswick. This should be completed after full consultation with all stakeholders," it added.

The revised $3.2-billion deal, announced last week and expected to be finalized by the end of March, involves the sale of most of NB Power's electricity-generation assets.

It is a significant shift from a $4.8-billion memorandum of understanding proposed last October, which would have also given Hydro-Québec control over the province's power transmission and distribution.