Wednesday, September 29, 2010

THE WHITE ELEPHANT IN THE BACKROOM

I will be in my native province of New Brunswick during the next few days; fresh in the aftermath of this week's defeat of the first term Liberal Government of Premier Shawn Graham.

During the month-long election campaign, the Liberal Party of Mr. Graham was hobbled by a laundry list of initiatives that on successive occasions during his government's term had residents of the province taking to the streets in protest.

The most controversial issues involved the provincial public utility energy corporation - NB Power. It was a two-fold element; a One, Two Punch really: More than four years ago another government, that of Conservative Premier Bernard Lord, committed to a contract with Atomic Energy Canada Limited (AECL) to rebuild the Point Lepreau Nuclear Power generating station along the Bay of Fundy. "Lepreau" is unique in that it was the first next generation CANDU 6 reactor to be built. It became operational in 1983 to support energy consumption in the Maritime Provinces and sales to the American northeastern states. It had been designed to be permanently shut-down 25 years later in 2008. But, anxious to demonstrate the viability of re-building and refurbishing its reactors - Which have since been also installed in China, South Korea, India, Pakistan and Argentina - AECL and NB Power entered into a contract to refurbish Lepreau. The effort is a gigantic money-pit which is several years behind schedule and the estimated cost of $1.4 Billion will likely be doubled. That excludes the $1-Million per day NB Power is spending to purchase elsewhere the energy the generators haven't produced since being shut-down in 2008.

Lest I digress; the project and its process are so acutely compromised that sources indicate that "starting over" is a real possibility, and technical assessments are now underway to determine whether that's the only viable solution.

Saddled with this spiralling debt at NB Power; and the province's own fiscal accumulated shortfall now near $10-Billion (About $12,000 for each man, woman and child in N.B.); Premier Graham's government entered into secret negotiations a year ago to sell NB Power to the Quebec public utility - Hydro Quebec. Hydro Quebec is a titan amongst giants, the largest public utility corporation in North America (perhaps the world) and the biggest exporter of electrical energy to the United States. Graham planned to apply the nearly $5-Billion profit against the public debt. It seemed like a wise decision...Well, at least a good idea at the time: It went over like a "pair of rubber crutches in a polio ward." (Or lest you be offended: " a pay toilet in a diarrhea ward.") - This week the fallout cost Mr. Graham the election, earning him the dubious title of the only one-term government since the Confederation of 1867.

The incoming Premier, Progressive-Conservative Leader David Alward, is committed to the key element of his Party's election platform...a check-list dubbed: "Ten By Ten" - To wit 10 promises to be completed in the remaining 10 weeks of 2010. Number two is the appointment of an "Energy Commission" by October 15th. A group composed of politicians, energy representatives, the public and various other stakeholders to crystal-ball the future and presumably avoid..."four more years of risky schemes and reckless behaviour" as Mr. Alward has said.

You know: In a provinces of under 750,000 people with an unsustainable debt of close to $10-Billion and with time running-out. It may take some mighty hefty balls (crystal or otherwise) to come to anything but the inescapable conclusion that selling NB Power is just about the only solution. Except perhaps this time 'round it will be a buyer's market.

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