Thank you, Mr. Speaker. Like my colleagues, through Members’ statements and questions, I will continue the issue of the Taltson expansion and the Deze partnership.
We have to be very clear, the GNWT represents the social interests of all residents of the Territories. To be crystal clear, the Deze interest is a group of partners that are represented strictly on economic interests, not public and social interests.
The challenge I see here is who represents the public interest in this partnership. That’s the question to the Premier right now, is how will the public be plugged into this partnership through accountability and in the context of public interest in this deal.
Thank you, Mr. Hawkins. The honourable Premier, Mr. Roland.
Thank you, Mr. Speaker. The public interest is represented by the Government of the Northwest Territories as a shareholder through the Power Corporation or through the Hydro Corporation itself. The public interest being served by the fact that there would be revenues accrued from that. The public interest would be in supporting aboriginal governments and building capacity and having long-term revenue sources going into them so that they can build on their capacity. The public interest would be reducing 100 million litres of fuel. The public interest would be 280 kilo-tonnes of CO2 reduced annually. That’s where our public interest is. That’s where the big picture is.
The Premier did not talk about how the public interest has a position in this. The public interest was not discussed in his answer about how the public interest gets represented. If we represent a one-third interest in a corporation outside of the territorial government, that’s way beyond arm’s length, then the public interest is lacking. What is stopping the Premier from evaluating fairly and strategically with all the proper information about the route that we’ve discussed in this House, which is either over the Simpson Islands or under the water? What is stopping this department of NWT power from evaluating that fairly and weighing and balancing the social interest and social benefits of this opportunity?
The interests are being represented, one, to help growth of the Northwest Territories through an economically viable project. Members have already said on a number of occasions that we do not want a repeat of where we are guaranteeing or backstopping and having to put additional dollars at risk. This model is based purely on the business-case scenario.
What I think I’m starting to hear is that, well, as a government maybe we should step in and put more involvement from the government side. That is a different scenario altogether. It’s been based on a business case. It’s been built on building capacity with our aboriginal partnership in the Northwest Territories. It’s built on a business case of extending mine life which would keep growth and revenue coming overall to people working, companies keeping their jobs and the Government of the Northwest Territories keeping its corporate taxes going.
The additional routing through the environmental phase has been done. That information has been provided. Again, if it’s the government’s will that we do this, then we have to accept that we’re going to stop the process where it’s at. We’re going to potentially add to the uncertainty of our economic climate at a time when that’s not the best solution.
Earlier in a response to Mr. Abernethy the Premier was touting the GDP growth because of this opportunity. To be honest, GDP growth in the Northwest Territories is all either theoretical or useless, because the piper being paid is Ottawa over the Northwest Territories. Yes, people are working, but those who are getting the money from the resources and those revenues go straight to Ottawa.
The Premier says this is all based on a business case. I’d like to hear the Premier explain to this House where the money will be coming from for this potential project as we all well know this is worth way more than any money that this territorial government could ever raise even at a one-third partnership. Where is the money?
The partnership that has been put together that has built this business case, this model is based on the fact that the power purchase agreements make this project viable. That is why the most economical routing has been put forward. If we decide as a government to socially engineer this, as some of the wording that has been used, then the Government of the Northwest Territories needs to find some of its own-source revenues to offset that cost, otherwise it gets passed on to the rate base. Who in the communities along that side can stand an increase in power generation and the cost of power generation from their existing areas of power generation?
The other part of the Member’s question leading up to that is, yes, the federal government gets the royalties from those mines. But let’s not forget that we just passed a budget that had over $800 million of transfer back to this government from the federal government.
The Premier raised the issue of power purchase agreements. Those are all well and good. But to date I have yet to see these power purchase agreements. As I said in my Member’s statement, if they are such a great deal for the diamond mines company, they would drag us to the table kicking and screaming and make us sign them with them. The point being, Avalon wants to sign a deal, Fortune mines is interested, the City of Yellowknife has a life of in perpetuity that we could be hooking up. Don’t forget about Dettah, Ndilo, Behchoko, Whati, and many other customers that we could create a grid with. The point being, the power purchase agreements are here today in living proof, not short-term mine life. Where are the power purchase agreements that they keep waving that are the key to this deal?
The city of Yellowknife and the surrounding area served by it, hydro facilities up to the city of Yellowknife over 70 percent is served by hydro. We have to run the diesels from time to time to offset some of the outages and the high demand times. The fact is if we were to build this project purely on the existing rate base, it is unaffordable. We could not pass that extra cost on to the individuals.
The Member spoke about Avalon. We would like to see that development occur. The issue is, at six cents per kilowatt hour we’re unable to develop any new extension of our facilities at that cost. We don’t have the customer base for that. Those are some of the areas that we’re looking at new customers to pay for this. That right now would be the mines.
Thank you, Mr. Roland. Final supplementary, Mr. Hawkins.
Thank you, Mr. Speaker. Where are the power purchase agreements? That really is the question. Where are the diamond mines who are willing to sign on the dotted line and say they are willing to buy power at ‘X’ rate? Where is the proof that they are behind this project? That could settle a lot of uncertainty today.
There have been ongoing negotiations for quite some time with the mines. In fact, there will be a meeting held in the very next...probably within the next week with the key folks from the mines. That will tell us if in fact we’re going to put any more effort into this. It is based on power purchase agreements that have to be signed off. But before we can get there, much like the Mackenzie Gas Pipeline, much work needs to be done to build the business model to go through the environmental phase, then a final decision on should the project go or not. We’re faced with the same scenario in the Taltson system.
Thank you, Mr. Roland. The honourable Member for Weledeh, Mr. Beaulieu.
