I know people are getting fatigued about this but it does continue to dominant the low level conversation around here because it was one of those once-every-10-years policy debates.
My random thought is this. Why did they announce what customer rate classes would get which rate arrangement? In hindsight it seems to me that added another layer of complexity to the debate. Why not announce the following at the end of October 2009:
We have entered into an MOU with Hydro-Quebec to explore HQ buying substantially all of NB Power, eliminating all debt, migrating our power needs to 100% carbon free power within 10 years, providing rate relief to all user classes for five years and guaranteeing competiting electricity costs for the future.
Let’s have a debate about that.
The problem with cutting industrial rates and freezing residential rates is that additional layer of complexity. Not only is the public required to think about the deal but also the fairness of the rates.
The reason I raise is comes from a story in one of Malcolm Gladwell’s books (Blink, I think, but I can’t remember). In it he talks about a study that was done where researchers sat two people down at a table across from each other and then they gave one person $100. That person was to decide how much of the $100 he would keep and how much the other guy would get. The catch was that both had to agree to the arrangement or neither got anything.
Rational economy theory would say that a $99 – $1 split would be accepted because for the second person $1 dollar is better than zero dollars. However, when they did this experiment over and over they found (as I recall) it was closer to $50/$50. In other words, I would rather lose $30 and deprive the other guy of $70 because his decision didn’t see fair or moral.
To tie this back to the NB Power debate, announcing a 23% cut for industrial users and a rate freeze for everyone else put us in a Gladwellian conundrum. Not only do I (as Joe Q. Public) have to evaluate the merits of selling the utility but I also have to evaluate the fairness of me only getting a rate freeze while someone else gets a 23% cut.
I am not saying the 23% cut was wrong – but that could be discussed and negotiated after the original issue was resolved.
It may have not had a material impact on the deal. I still think the water was poisoned in the early days by various media and punditry that didn’t want to give it a fair hearing.
I still have this sinking feeling we missed an opportunity to address an important issue and I think it was never really debated in a fair way. Emotion trumped reason.