Back in the saddle

After a couple of days of reflecting, I have decided the best thing to do is to restart the conversation here about the NB Power sale to Hydro-Quebec as well as other economic development issues that matter to New Brunswick.

I took the allegation of conflict of interest seriously but I have talked with a half dozen people that understand and have dealt with these issues for years and they assure me that there is no issue here and I will leave it at that.

I hope we can have civilized discussion about the issues. I went back through some of the 500+ comments that I have received on the NBP/HQ issue and the majority are mostly rants or restatements of the same theories.  I think there is a FaceBook site if you need a cathartic release.  In that same review of the comments I came across a pile that really were pertinent to the issue.  I guess we need to flesh those out and try and debate them better.  Or least make sure that the folks reviewing this MOU before moving to the outright terms of sale have access to them.

As I have said, I fully believe in the broad strokes of the MOU.  It is shifting the cost structure lower for electricity in this province considerably lower and that will be good news for industry and everyone else.  

I continue to maintain that NB Power – due to a variety of factors from its debt, to generation mix, to age of assets, was on a path that would not allow for industrial power rates that would remain competitive with other industrial jursidictions across North America.  In fact, I talked with an NB Power guy just six months ago and he agreed with me that it would be impossible for New Brunswick to ever compete with Quebec or British Columbia again on power rates (as New Brunswick did for years). 

Of course, one of the aspects of the debate is whether or not that even matters.  There are many economically successful jursidictions that do not have cheap power.  There has been a thread of discussion on this blog that we should not seek competitive industrial power rates rather we should turn our focus elsewhere.

I don’t think it is a binary choice.  I think we need to have a strong and growing industrial economy serving 21st century needs across North America.  At the same time, we need to find our niche in the new knowledge economy.   It doesn’t need to be either/or.

8 thoughts on “Back in the saddle

  1. Welcome back. Your blog has (until recently) been filled with interesting perspectives and thoughtful comments. More importantly, it has generated more talk about serious economic development in New Brunswick than any other initiative. Well done.

    So, giving you a break from the energy talk, today’s 326 page budget contained nothing that I could find to take economic development to an effective place. More money for universities, another slush fund for the north (don’t they have enough golf courses?) and lower taxation (which I think will now dip below the amount they raised it in the first year in office). It seems the BNB shuffle has taken place (check the BNB org charts) and it is just that (unless there is a surprise phase II). Haven’t we seen this all before? Did we think it worked?

    It appears that this government’s economic development strategy is summed up by low taxes, low energy costs (sorry I mentioned it) and an endless money supply to universities. Do you think that will start working soon? I am doubtful.

  2. This blog starts my day and I was a little lost there for a couple. I certainly hope we don’t get too many vehement posters on the NB Power deal going forward, this blog is for ED across all areas of NB and not just one deal, if they want to rage and as you say there are places specifically for that.

  3. Actually, there AREN”T any more places to ‘rage’ anymore. At facebook they put a kibosh on the ‘wall’ because people were simply joining, posting a rant, then leaving. They are ‘directed’ to another facebook group, but most won’t pay attention to that (the numbers have just about crested anyway at 26,000).

    Over the last few days I’ve read more and more about this and definitely feel that ‘rage’ is COMPLETELY justified, but unfortunately there is simply nothing people CAN do except become livid and protest. It’s not like this is a democracy or anything.

    I’ve talked to a LOT of people (30+) and many are ex NBers, the so called ‘best and brightest’:) And people are absolutely infuriated. I have one friend who married an ex pat Irishman who said “If that were Ireland somebody would have burned something down by now”. That DOES say a lot, and at least the most we are seeing is people shouting and getting angry.

    But after awhile rage always subsides. Critical discussion is necessary for many reasons, not least of which is the several court challenges that will be launched at the beginning of the new year, both from an environmental standpoint, a democratic standpoint, and a legislative standpoint (and a couple other initiatives I’m not supposed to mention:) Judges don’t tend to listen to a lot of expletives, but they DO pay attention to things like polls, protests, and the general interest.

    So in that this blog serves a valuable purpose. David really hasn’t had the readership or the issues that generate the crazy posts like Charles Leblanc’s site, but just because a person talks crazy doesn’t mean they don’t have a point.

    In the last couple of days there have been several CBC articles, one of which is in David’s pet peeve area-namely where the CBC is talking to somebody who endorses the deal. Unfortunately the person does more ‘fear mongering’ with statements like “NB has the dirtiest coal power in North America” but when a search was done, NB isn’t even on a list of the worst 200 coal pollution producers in the world. More than 50 of those are in the US, and two are in Alberta.

    It’s also ‘mostly’ his opinion, and like David he only agrees with the ‘general outline’ of the MOU. The unfortunate thing is that BOTH sides have said they aren’t interested in making ANY changes.

  4. Welcome back, David. What I expect to see over the next few months is more disclosure re the condition (fiscal and otherwise) of NBP. One of the reasons for the ‘shock’ is that GNB has rapidly reversed itself publically wrt NBP. For a number of years, the storyline was that NBP was basically in good shape and was going to weather the thermal plant problems, the refit of Lepreau, etc. Now, we are told the reverse. Therefore it is incumbent upon GNB, and the commissions they have established to review the deal, that we get disclosure. Then a discussion can be had; at present, its just ‘he said/she said’. That encourages the ranters but does little else.

  5. I think that is right. I was in a group discussion tonight and it felt like out of 7-8 business people I was the only one defending the NBP deal. I look and the broad strokes and can see the value. I certainly want clarification on power outside the pool, incremental costs for new transmission infrastructure, etc. but I see the value. Problem is that the vast majority of people don’t agree and some of the arguments don’t even make much sense. One person told me that we should just buy cheap power from Quebec and shut down our dirty generation. Another said the Alward line that Quebec will charge whatever they want after the five years. Another made a novel point – he said that Quebec would never let NB compete with them for new industry and another made the catch all point that we are screwed after five years. All interesting. All not really based in reality.

  6. Welcome back David. It’s encouraging to see that you’ve decided it’s more important to be a continued part of this debate. I feel it’s provided a platform where other underlying challenges in the province had a chance to be exposed.

  7. I understand why logically-thinking people in favour of this deal are baffled by the people who passionately reject it. But the answers do not lie in the logic of the deal itself.

    The reason people are passionately against the deal (sometimes blindly or radically) is people perceive they were tricked/taken advantage of/lied to/misled or whatever politically correct spin you want to put on it. The Graham government acted as though NBP was fine and liked the leadership so much extended Hay’s contract by 3 years. Everything was in line with the party policy of not selling NBP then all of a sudden out of nowhere there is “crippling debt” and NBP is “unsustainable”. No explanation, no humble pie, no explanation why we are changing our policy, just ‘we know best so shut up and accept this or you’ll get a 3% rate increase in April’. Very poorly handled. Right up there with Tiger’s PR people. You can analyze whether a policy is a promise and so on but the important thing is, the general public (understandably) thought NBP was fine and the Graham government had no intention to sell it.

    This deal will be historic not because of the energy aspects but for the public relations disaster and the power of social media to organize (Facebook, web sites, Youtube). Watch for it to be a case study in text books and the material for a best seller or two. Despite political, government and taxpayer-paid spin doctors (some of the best), they read the public all wrong from the moment Graham denied he was breaking a promise (since adjusted to “changed his mind”) to the current antagonistic government web site that avoids answering questions, answers questions that were not asked and responds like some sort of kid’s pull-string talking doll cycling through pre recorded messages. Graham and others express surprise at the public’s passion for NBP; that is not it, it is the passion for their own self-respect which they feel has been violated.

    The best deal you can imagine will not be accepted by people if you don’t have the respect and trust of the public. Graham violated both then followed it up with arrogance to amplify the problem. So, if you are baffled by the widespread, sometimes radical rejection of this deal, don’t look for answers in the details of the deal, look at the leadership and the PR team that pitched it.

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