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Dear Mr. Matthews:

Thank you for your message about the proposed agreement the New Brunswick government has reached with the Province of Québec regarding the future of NB Power.

I agree that we have been in the middle of the toughest economic times in decades.  Many industries are struggling and too many New Brunswickers are looking elsewhere for jobs. Fortunately, this proposed agreement will help industries employ thousands of New Brunswickers because it is part of a bigger plan.

In addition to households benefiting from a five-year rate freeze, large industries, the major employers in our communities, will receive an instant rate decrease of up to 30 per cent.   Combined with the tax reductions of more than $380 million featured in the government’s Plan for Lower Taxes in New Brunswick, this will give our province a competitive edge in sustaining existing industry and attracting new investments to the province.  This means more jobs for New Brunswickers.

It is important to note that the intrinsic value associated with NB Power assets is derived, not simply from the long-term incremental revenues of aging generating facilities or tariffs collected for accessing our transmission grid, but rather the long-term financial stability and synergies to grow our energy hub and the significant environmental benefits gained from the partnership.

As the largest utility in North America, Hydro-Québec has the scale to absorb considerable financial risk.  NB Power’s current debt of about $4.8 billion represents about 40 per cent of New Brunswick’s provincial debt or $6,500 per person which is a huge burden for current and future taxpayers.  Replacing aging facilities over the next decade will add further billions to the debt.  Meanwhile, under the proposed agreement, we would stabilize rates and use greener energy.  The proposed agreement will also reduce New Brunswick’s need to import dirty coal and oil from abroad in the long term, which of course is of concern to everyone.

Please note, Mr. Matthews, we are not “selling New Brunswick” but entering into a win-win economic partnership with a neighbouring province to gain access to a reliable supply of hydroelectricity. NB Power, while owned by Hydro-Québec, will still be called NB Power.  The same dedicated employees will continue to work there.  In fact, our skilled workers were a significant asset in negotiating this deal.  Under the proposed agreement, we are protecting jobs not cutting them.  It is important to Hydro-Québec to retain the continuity of the services now in place and ensure a smooth transition should the deal go through.

Hydro-Québec is also interested in investing in the New Brunswick Energy Hub where we have made major advances in renewable energy generation in the last three years.  In addition, our electricity generation and transmission would remain a regulated industry in New Brunswick, just as in other provinces like Nova Scotia and Newfoundland which do not own their electric utilities.  NB Power’s headquarters will remain in Fredericton and I will not conclude a final agreement unless New Brunswick’s interests are protected into the future.

Further to your request to post a plan on the government website (www.lowerratesnb.ca) please see the recent NERA report posting.  The international economic consulting firm’s report estimates that ratepayers would receive about $5.6 billion in rate savings under the proposed agreement.  The report confirms that residential and other small business ratepayers will reap close to two-thirds of the savings under the proposal.  An independent Advisory Panel, chaired by Mr. Ganong, Chairman of Ganong Bros Ltd. and comprised of business and academic leaders has been appointed to examine the proposed agreement.  The six-person panel has been directed to submit a report examining the benefits of the proposed agreement, which will be tabled in the Legislature, by January 15^th, 2010.

Your government has been meeting with New Brunswickers to ensure people have all the facts. We are listening to people’s concerns and are open to ideas and alternatives.  Thank you for writing about the proposed agreement and for taking part in this discussion. 

Sincerely,

Shawn Graham

Premier

General Hydro Quebec, Lower Rates, NB Power, New Brunswick, Response

Here is my email that I sent in to- http://www.lowerratesnb.ca

feedback@lowerratesnb.ca
premier@gnb.ca
info@pcnb.org

I don’t understand half of the arguments in favor of this deal and as a voter I am against this.

After the five-year period, power rates will only increase to keep pace with inflation and new generation needs. That means savings of at least $465 each year. Recent history suggests rates are likely to grow by three per cent a year under the status quo.

The government owns NBPower which means they don’t have to raise the rates by 3 percent every year they just do. I don’t understand why there is a letter from NB Power CEO David Hay who has constantly failed to run a company first by wasting money and lying to New Brunswickers about having a fuel deal from Venezuela, and lately Point Lepreau refurbishment which was promised to be on budget and on schedule ( which is how many millions over budget?).

Why is it Hydro Quebec and can see a way to make a profit in New Brunswick but NB Power can only seem to throw away money? Maybe the problem isn’t the company maybe it’s the people in charge who are failing New Brunswick.

You slash out a big part of our debt but you also will take away any profit the company could make ever again in the future, so if it got turned around in 10 years (if you put in real leadership now) then you are not counting on millions of dollars in lost revenue. You also remove any negotiating power with PEI, NFLD, NS with transporting energy to the States. Our Premier Shawn Graham has said he wants us to be an energy hub, now he is saying he wants us to be a power hub that Quebec controls and profits from.

You are selling out New Brunswick and you have no real proof there is long term benefit for New Brunswickers. I would much rather pay a higher rate that goes to New Brunswick than pay the exact same rate to Quebec. Plus on top of that why are businesses who get to write off costs of operation such as power getting a reduction and we would only receive a rate freeze?

Businesses at tax time get to write off costs of operation % which includes power so if anyone is going to get a break from selling out New Brunswick it should be New Brunswickers who should get the break not companies that make tons of money that already get the benefit of writing off some of the power bill. No working New Brunswicker gets to write off for having a power bill yet they only get a rate freeze for 5 years as we pay money to Quebec.

So as my final statement I will take this issue into serious consideration when the next time an election is called and anyone that wants to sell out my province will not get my vote. I expect to see the other parties in New Brunswick to stand up for me and say Our Province is not for Sale!!

After the tough economic times, many New Brunswickers going to Alberta for jobs, forestry and fishing industries struggling after many mill closures, How can you sell out New Brunswick for a quick cash grab. I want to see on the website http://www.lowerratesnb.ca put up a 20 year plan of how this is truly beneficial to New Brunswick. I also want them to put up a comparison of where it would end up if it was still run by New Brunswick and then a 3rd and final 20 year plan that says how New Brunswick could out perform Quebec in running our own power company.

Also I have posted my email to the people of New Brunswick on my blog – http://blog.elitegd.com/2009/10/31/dont-sell-out-my-new-brunswick/

Blog Responses Lower Rates, NB Power, New Brunswick, Power