Nova Scotia’s NDP has taken to regurgitating the demagogic ignorance and malice of Newfoundland’s former Conservative Premier Danny Williams in the NDP’s recent Youtube ad attacking a political opponent for proposing Hydro Quebec as an alternative supplier for the province.
The thrust of the NDP’s claim is that Hydro Quebec is not a good energy supplier to do business with.
To illustrate the ignorance of the NDP’s rant, consider Hydro Quebec as a supplier from the perspective of consumers in Vermont. HQ has been a reliable supplier to Vermont for decades. In 2010, Vermont consumers got a 26-year, market-indexed deal with a starting price of 5.8 cents/kWh.
Compare that with the Muskrat Madness the NDP is defending. During the first 5 years of the deal, Nova Scotia consumers get a discount on the block of power that Emera has contracted. With the discount, the price is only about 11 cents/kWh. By 2022, the price jumps to 16 cents/kWh then escalates from there (see figure Figure 4-4 of Exhibit M-2 of Nova Scotia Power Maritime Link’s application to the NS regulator). While it is true that Emera is hoping to dilute down this absurdly high cost by buying surplus energy from Newfoundland at a price close to what HQ now charges Vermont, those rates and volumes are uncontracted.
Nova Scotia’s NDPers are trying to score political points by joining a Newfoundland tradition of bad mouthing the Upper Churchill power deal signed with Hydro Quebec in the 1960s. Rather than rehashing the twisted Williams version of ancient history, it would be more informative for Nova Scotians to consider Hydro Quebec’s recent record of dealing with Newfoundland and Newfoundland’s own recent track record of dealing with other power interests.
Starting in 2009, Quebec negotiated an agreement allowing Newfoundland to wheel power from the Upper Churchill that Newfoundland has rights to — so-called “recall” power — but is in excess of Labrador’s needs. This excess recall power is wheeled through Quebec’s grid to the U.S. border for sale to other utilities. In addition, Hydro Quebec has waived its rights to the TwinCo power block when it expires in 2014 — another key element of the Upper Churchill deal from the 1960s.
Both of these recent negotiated settlements look to me like exemplary fairness on behalf of Hydro Quebec.
If any province faces a credibility challenge as a supplier to Nova Scotia, it isn’t Quebec but Newfoundland.
Newfoundland capriciously and unfairly treated participants in its 2005 “Expression of Interests (EOI) and Proposals” process related to Lower Churchill development. For the announcement canceling the EOI process see: NL cancels EOI. Many firms and government agencies participated in good faith in that EOI process, only to have Newfoundland pull the rug out from under them.
The Newfoundland government’s actions in confiscating power assets from Abitibi in 2008 should also raise questions about the risks of depending on Newfoundland as a supplier.
Post script Feb 28, 2:30 pm EST:
The Halifax Chronicle Herald today has an editorial discussing the NDP’s attack ad and making the point that it is bad form for the government to politicize an issue that is currently before the utility regulator. Here is the editorial.
Another example of a utility that has benefitted immensely from a close commercial relationship with Hydro Quebec is NB Power. NB Power announced yesterday what appears to me to be an excellent investment in the refurbishment of a transmission connection asset linking HQ with NBP.