Rebuttal (really a rant) to Grahams blog entry

For those who read the Shawn Graham blog entries at the lowerratesnb website. I picked out the meaty part from the middle of Grahams latest post, and added some comments. Not that it's really so meaty, as most would starve trying to digest what he says, but anyway, it's my rant of the week. My comments are in red, as that is the color most people see when talking of this subject. And my rants don't get links to real information. Trust me, it's all out there in the www. The rant starts here.

The first question most people ask me is "Why was this step necessary?"

Yeah, Shawn, why was this necessary? For each of your statements, I have my own. Enjoy.

First, without a plan, rates would continue to increase. This puts a strain on the pocketbooks of our families and means our businesses and industries will be spending more money just to keep the lights on, instead of making their operations more profitable and hiring more workers.
Rates will still continue to increase. Industrial rates will go up as soon as the deal is signed, and will continue to go up forever. RCW rates only get a five year freeze with a substantial jump in year six.
Second NB Power's $4.8-billion debt is not manageable in the long-term, and as we look ahead at the costs of replacing our fossil fuel plants, that debt exposure would grow by at least $10 billion.

Hydro Quebec is adding $25 billion worth of infrastructure in the next four years to their already existing $36 Billion dollar debt. Plus if they add NB Power’s debt, the total could be over $60 Billion by 2013. Almost equaling their asset value today. No different than the situation NB power is in.

And finally over one-third of New Brunswick greenhouse gas emissions come from energy generation. And we're too dependent on coal and oil from foreign countries to heat and light our homes.

Since when is the US a foreign country? Technically, I guess it is, but I would have to say its a reliable source. Most of Belledune’s coal and petcoke supplies come from the US. Why can we not use the 100 million barrels of oil produced in Newfoundland each year? We have a major natural gas pipeline that supplies the US with natural gas to run power plants and the Bayside power plant in Saint John. The McCully Field in the Sussex Moncton area produces about 10% of the gas that flows through the line, and has the potential to supply more than Sable Island. How is that foreign? 10% of Newfoundland’s oil output would keep NB Power’s Coleson Cove station running at full load everyday of the year. To bad we didn’t put together a national energy policy when we had control, instead of giving it away to our southern friends to pad their pocket, and force us to buy our own resources back on the open market at inflated prices. When Hibernia went commercial, the break even price was $ 9 per barrel of oil produced.

What is your next idea to reduce oil and gas consumption for the transportation sector? Oh yeah, you won’t be around long enough to get to that issue, so no need to worry about it.

These three factors must be addressed if we want to achieve our goal of a self-sufficient New Brunswick.

See above to find out how to address your problems.

So early in 2009, our government sought out an opportunity to lower rates, lower debt and lower our dependence on fossil fuels while maintaining control of our energy policies.

Quebec also sought out new customers as they now can’t compete with the cheap natural gas stations in the US. They also lost an aluminum smelter, pulp mills, mines, and other small industries totaling 8.5 TW worth of sales. This is almost equal to the proposed RCW pool in NB. They needed some new customers. The $25 billion in new dams and transmission lines will cost them a fortune in financing, and the need to pay for it somehow. Fortunately for them, along came you, and guess what? They say there is one born every minute.

As for lowering debt, well that’s a joke.

And we looked for a partner who could help us achieve that.

Partner? I guess when you buy a new car, you could call the dealership that sold it to you a partner. Some one who will give you a five year warranty, and then bleed you dry every time you pull in for even a basic oil change. Eventually you will need a whole new car, and they will be glad to sell it to you.

While we have an excellent partner in Hydro-Québec, we have heard New Brunswickers' concerns about protecting our energy sovereignty. New Brunswick will maintain absolute control over our energy policies. Hydro-Québec is a company operating in a highly regulated industry. Here in New Brunswick, we still set the rules and Hydro-Québec must follow them. That's part of the proposed agreement as it now stands but having heard the concerns from New Brunswickers our government is looking at how we can further protect and enhance New Brunswick's energy sovereignty.

Why would you make the statement that “NB will maintain absolute control” and “look at how we can further protect” in the same paragraph when referring to energy sovereignty. Are you doubting your own beliefs?

Our government will continue to decide what the energy priorities are, what kind of power plants can be built here, and where they can be built.

What kind of power plants? Give it a break. Status Quo or not, because of the economic downturn and loss of industry, NB wouldn’t need a new power plant for 20 years anyway. I thought the future was green. NB has 5000 MW worth of wind power potential. So do PEI and Nova Scotia. Partnering with Hydro Quebec for load control and a place to store all the excess wind energy would be a partnership. That would be progressive thinking. Building wind to hydrogen energy conversion facilities to store excess wind energy, and using it on less windy days would be progressive thinking (no I’m not a paid conservative – but will be voting that way). Newfoundland is looking for customers and a route to the US for it's vast hydro power potential. Partnering with them would have been progressive.

And New Brunswick's Energy and Utilities Board will make the final decisions on whether rates can increase.

This, I can’t wait to see. You can’t even stop the price of home heating fuel and gasoline from bouncing up and down. How come you can’t stop NB Power from doing a simple small 3% rate increase? Is this a smokescreen for the bigger 1 cent per kilowatt hour increase that the Quebec Government (notice I did not say HQ) plans to implement to cover their ballooning debt.
This would be a 26% rate increase to the generation portion of their rate. And about a 16% overall rate increase. I’d like to see the look on the NB industrial customers face on April 1, 2010 when this gets implemented, and they kiss their big rate reduction goodbye. You should put this in your NERA formula and see how many Billions are saved over eternity.

When you ask HQ to tender for any possible new load growth, and all the bids come in at a much higher rate than what is currently paid by the heritage pool, how do you regulate that? Either you pay, or you turn off some customers. Right?

See you at the polls in September.