Debates of March 29, 2004 (day 10)

Thank you, Mr. Speaker. Mr. Speaker, it's my understanding that a number of the community franchises are not signed and in place right now with the Power Corporation. Legislatively, what instrument do we have to prohibit a company coming in, other than the Power Corporation, and competing for power supply in those communities? Right now, at the present time, what's stopping that from happening? Thank you.

Mr. Premier.

Further Return To Question 102-15(3): Community Franchise Recommendations Of The Robertson Report

Mr. Speaker, there are some franchises that have terminated and have not yet been signed off, but we are in the process of doing that. To my knowledge, there really isn't anything that would prevent someone from coming in and setting up a competing structure if they wanted to. In most situations, they would have an incredible task on their hands if they wanted to handle both generation and distribution. Mr. Speaker, I expect that if they were to try and set up a whole new system or duplicate a system, the Public Utilities Board may also come into play on that. Thank you, Mr. Speaker.

Final supplementary, Mrs. Groenewegen.

Supplementary To Question 102-15(3): Community Franchise Recommendations Of The Robertson Report

Thank you, Mr. Speaker. I would like to ask the Premier if he has any plans or if this government has any plans to put something in place from a legislative point of view, that would create a monopoly for those communities which are presently being served by the NWT Power Corporation, to prevent such a scenario from happening. We know that in Fort Simpson it almost did happen, where an outside community came in and took that particular community out of the NTPC revenue base and mix. Thank you.

Mr. Premier.

Further Return To Question 102-15(3): Community Franchise Recommendations Of The Robertson Report

Mr. Speaker, the Member is correct, that there were 22 recommendations in the Robertson report. Franchises certainly was one of them. That is something we are looking at, and certainly will take into consideration the issue about having people come in and try to provide energy services in selected communities. So our intention as we put together our action plan on the Robertson report, which we fully intend to do, is to prevent that kind of cherry picking from happening. But at the same time, also leave it open for northerners who may want to try some alternative methods of generating energy on their own, whether it's solar panels or possibly even generators that they would set up in their own businesses to produce both heat and energy. So we don't want to exclude everyone from having input, but we do want to prevent people from coming in and picking out those that are profitable. Thank you, Mr. Speaker.

Thank you, Mr. Speaker. Mr. Speaker, I would like to pursue questions on the BIP issue. Mr. Speaker, last Friday in Hansard on page 826, the Minister of RWED…My question is to the Minister of the Housing Corporation. I do want to say that the Premier and Ministers McLeod and Bell on Friday made commitments to this House to provide various stats and figures, based on which they made the decision to waive the BIP. It was supposed to be done before session and we still don't have it, so I have to pursue more questions. Mr. Speaker, I am not clear about how these decisions came about to waive the BIP. There was a suggestion that this decision was made in the last Assembly. Then there is a suggestion that we have to go now, we can't put a brake on or else all projects will fail. So I would like to ask the Minister responsible for the Housing Corporation who decided to waive this BIP, this Cabinet or the last Cabinet? Thank you, Mr. Speaker.

Minister responsible for the Housing Corporation, Mr. McLeod.

Return To Question 103-15(3): Waiving Of The Business Incentive Policy

Thank you, Mr. Speaker. Mr. Speaker, there was a commitment made on Friday to provide information to the Members, and I have followed up and we're expecting that information to be here shortly. In response to the question on who made the decision, the initiative was developed in the 14th Assembly, however, the Cabinet of the 15th Assembly confirmed and it was to go ahead to proceed with this whole initiative. Thank you.

Supplementary, Ms. Lee.

Supplementary To Question 103-15(3): Waiving Of The Business Incentive Policy

I wonder if anybody notices the irony that the Cabinet could take a whole assembly to make a decision like this, but Members on this side have no say whatsoever. We get two weeks' notice and we have to go with it or else. We are being told over and over the government will not revisit this, that he will not put any brakes on this. Mr. Speaker, I think there is less than full information that we know about what is surrounding this contract. All the Ministers have suggested that they are waiving the policy, because having the policy in this contract has the potential to increase the cost. The Ministers also suggest that they have to go with the most economically feasible one, and that northern contractors have the option to apply, suggesting that everybody is open to bid on it and whoever bids the best will get it. But, Mr. Speaker, I have information that suggests that the Minister and the government is really going for the southern contractors. So I would like to know from the Minister whether or not there has been any direct communication between the department with the southern contractors to see this contract go to the south. Thank you, Mr. Speaker.

Minister responsible for the Housing Corporation, Mr. McLeod.

Further Return To Question 103-15(3): Waiving Of The Business Incentive Policy

Thank you, Mr. Speaker. Mr. Speaker, I'm not aware of anybody in the south who has been contacted. There may have been some contacts made in terms of assessing what the average cost of these units would be, but I have not seen any information in that regard. We are quite comfortable that there are many, many people picking up the tenders, including northern people interested in bidding on these things. But in response to the Member's question, no, I am not aware of any companies that were contacted, at least not any that have been brought to my attention. Thank you.

Supplementary, Ms. Lee.

Supplementary To Question 103-15(3): Waiving Of The Business Incentive Policy

Thank you, Mr. Speaker. I would suggest that the Minister speaks to his officials and confirms as to whether or not southern companies were contacted about this contract and, if so, whether any northern contracts were contacted as well. Mr. Speaker, my last question; I do not understand the rationale that if we put a break on this tender process until some questions are answered that are being raised by the Members in this House, that we're not going to see housing this fall. I don't understand that rationale. I would like to ask the Minister again whether or not he would consider extending the time by one month? Thank you, Mr. Speaker.

Minister responsible for the Housing Corporation, Mr. McLeod.

Further Return To Question 103-15(3): Waiving Of The Business Incentive Policy

Thank you. As the request from the Member indicates, there seems to be some dissatisfaction with the communication. We are having a Cabinet meeting on Thursday, and it's something I will bring up for discussion. However, we have to keep in mind if this project is deferred by a month, we certainly will not meet the barge deadlines and, therefore, may not be able to go ahead. However, I will commit to the Member that I will bring it forward for Cabinet's discussion. Thank you.

Thank you, Mr. Speaker. I will continue where my colleague, Ms. Lee, left off. I have some more questions for the Minister responsible for the Housing Corporation. The Minister states that if we delay the tender, that the units will not get into the communities, and I must say I don't disagree. This has to happen and it's the timing of the whole thing. But, Mr. Speaker, what evidence is there that the Housing Corporation has consulted and communicated with northern manufacturers? Will the Minister provide this House with that information? Thank you, Mr. Speaker.

Minister responsible for the Housing Corporation, Mr. McLeod.

Return To Question 104-15(3): Waiving The Business Incentive Policy

Thank you, Mr. Speaker. Mr. Speaker, I already made the commitment that I would go back to my officials and get that information. Thank you.

Supplementary, Mr. Ramsay.

Supplementary To Question 104-15(3): Waiving The Business Incentive Policy

Thank you, Mr. Speaker. I will remind the Minister that the tender closes on Friday, which would in effect cut the northerner manufacturers out of the equation on this tender. When the Minister speaks of it being less expensive by waiving the BIP, where is the proof of this, Mr. Speaker? Can the Minister show us the proof? Thank you.

Minister responsible for the Housing Corporation, Mr. McLeod.

Further Return To Question 104-15(3): Waiving The Business Incentive Policy

Thank you, Mr. Speaker. Mr. Speaker, what was done in this instance was a general average of what it would have cost for mobile homes to be utilized. In terms of proving it would be more expensive, that's a very difficult task as the Member knows. All we can provide and use as estimates is a best-case scenario, which is a general average, and a worst-case scenario, and anything in between. There is potential for up to a 15 percent increased cost. We will provide that information to the Members. Thank you.

Thank you, Mr. Speaker. Again, my questions are for the Premier with respect to power-related issues. Mr. Speaker, information would indicate that with respect to the Taltson Hydro Dam expansion that our government has invested a fair amount of money in posing that question as to whether or not that is a good idea, and whether or not there is a market for additional hydro from the Taltson River, at least $1 million on an engineering study and at least $1 million on an environmental study. The market that is being targeted for that hydro is from mining companies, and we have heard reference to the Snap Lake mine as one of the potential customers for that. Mr. Speaker, I realize that we need to invest money in order to make money, and this seems to have some financial viability for the Power Corporation and ultimately for this government, but I am wondering how confident the Premier is with respect to those markets given the amount of money that is being invested in pursuing this Taltson expansion. Thank you.

Mr. Premier, Mr. Handley.

Return To Question 105-15(3): Taltson And Bear River Hydro Projects

Mr. Speaker, there has been about $2 million invested up until now. Most of that money is from the Power Corporation, not from the government, and if the Member wanted a break out I would have to get the numbers for her. Mr. Speaker, we have had letters of interest from all of the operating mines in the slave geological province telling us that they are interested in the potential of hydro power if we can make it available. We don’t have any negotiated deals signed off yet, but all of the mines are interested if we are able to do that. As well, Mr. Speaker, there is also opportunity to sell that power south, and we will do some work over the next few months to look at that as an alternative. Thank you, Mr. Speaker.

Supplementary, Mrs. Groenewegen.

Supplementary To Question 105-15(3): Taltson And Bear River Hydro Projects

Thank you, Mr. Speaker. Mr. Speaker, when the whole idea of generating additional hydro power in the Northwest Territories began to be spoken of, there have been studies on the books for years about this, but most recently in the 14th Assembly there was a great deal of anticipation and excitement about this potential because of all the merits of hydro power. I still think that we need to be cautious, ensure that we have a good business plan in front of us as we pursue some of these initiatives. So I would like the Premier, if he would, to also speak to the challenges of the transmission. He has spoken to the markets and the letters of interest from the mining companies, but the transmission infrastructure is always a big question in this equation given the life of the mines and their requirements, and I would like to know whether the Premier believes that those transmission issues can be addressed adequately. Thank you.

Minister responsible for the Power Corporation, Mr. Handley.

Further Return To Question 105-15(3): Taltson And Bear River Hydro Projects

Thank you, Mr. Speaker. Certainly from a technical perspective, the transmission issues are doable. We have checked out that a 400 and some kilometre line would be necessary, is feasible, particularly if we have all of the mines on contracts with us. We do have other issues that we need to deal with in terms of the length of contracts and so on. From a financial perspective of the cost of putting a line from Taltson to the diamond mines, it is expensive, it is in the neighbourhood of $170 million. The viability of that, or the feasibility and the economic viability is determined largely on the price the mines are ready to pay, and the length of contracts we can enter into, as well as our estimate of the potential power that will continue to be needed in that region. Thank you, Mr. Speaker.

Final supplementary, Mrs. Groenewegen.

Supplementary To Question 105-15(3): Taltson And Bear River Hydro Projects

Thank you, Mr. Speaker. Mr. Speaker, I would just like to further ask the Premier a question with respect to the Bear River proposal. I know we haven’t invested as much time and money in that particular initiative, but the market that has been suggested there is the pipeline. I am not as confident perhaps as the Premier is that that is a market that is going to pan out. So before we go charging down that path, I would like to ask the Premier if there are any alternative proposed markets for hydro in the foreseeable future for the Bear, or is the government hinging all of their hopes for this resource on the pipeline? Thank you.

Minister responsible for the Power Corporation, Mr. Handley.

Further Return To Question 105-15(3): Taltson And Bear River Hydro Projects

Mr. Speaker, the Member is correct that not nearly as much technical work has been done on the Bear River potential. We have certainly had good discussions with Imperial as the leading partner in the pipeline project. We know that they are interested. Again, as in any business deal, price is important to them. We know that they are interested in initially about 90 megawatts of power. That is equivalent to the amount of power the Power Corporation sells to all customers in the Territories right now. So it would double the business the Power Corporation does, which is necessary to get over the economies of scale issues, as was mentioned in the briefing we gave to AOC at noon today. Mr. Speaker, if this project works out, then they would need up to 300 megawatts of power, making it a very viable one to have a hydro transmission line right down the valley serving all of the communities along that route from Inuvik all the way south. The other alternative, Mr. Speaker, is if we work out a deal with the pipeline then it also opens up a market to sell power south as well. So that one has huge potential, but neither of these projects will move ahead unless they have regional support. Thank you, Mr. Speaker.

Thank you, Mr. Speaker. Mr. Speaker, the Bear River hydro project caught my ear, so I want to ask a question to the Premier. In light of the Bear River project, I wanted to talk about the power rates that we have in the small community of Colville Lake. The amount that they have to pay for their power in light of the potential for the Bear River project, what can we tell the people in Colville Lake in terms of seeing a decrease in their power rates? Thank you, Mr. Speaker.

Minister responsible for the Power Corporation, Mr. Handley.

Return To Question 106-15(3): Power Rates In Colville Lake

Mr. Speaker, the present strategy with the Power Corporation is to try to increase the size of our customer base and the amount of power we sell. If we are selling more power, then that helps to cut down our fixed costs that make it more economical for everyone. Though I think, Mr. Speaker, in answer to the Member’s question, we can tell people in the small communities and throughout the Territories that if we are able to put together these deals which result in us selling more power through the Power Corporation, earning more revenue, then we would have more capacity to be able to deal with their needs. Mr. Speaker, it is always a challenge to deliver electrical power to a small number of customers because the capital costs are huge, and even with our subsidy it means terribly high power rates. Thank you, Mr. Speaker.

Supplementary, Mr. Yakeleya.

Supplementary To Question 106-15(3): Power Rates In Colville Lake

Thank you, Mr. Speaker, and thank you, Mr. Premier. In light of the Bear River hydro potential for power in the Sahtu, and the rest of the Northwest Territories, between now and whenever that project comes to reality, what can we tell the people in Colville Lake and other communities like Colville Lake in terms of how to reduce the cost of power in their communities? I understand that the Bear River could be a significant benefit to a lot of people in the Northwest Territories, but between now and then I would like to know what type of plans the NWTPC has in terms of reducing the cost of power…(inaudible)…consumers are paid. Thank you, Mr. Speaker.

Minister responsible for the NWT Power Corporation, Mr. Handley.

Further Return To Question 106-15(3): Power Rates In Colville Lake

Thank you, Mr. Speaker. For the past year or so, the Power Corporation has done a number of things to help with the cost of power. First of all, they’ve done up to 500 audits and they would be very pleased to go in, if they haven’t done it already, and do audits of power usage by customers in communities like Colville Lake to help them come up with ideas on how to cut down the power. We would also be willing to take the same message to the Energy Alliance. The Department of RWED also has some capacity to help people to find ways to cut down on their power. Mr. Speaker, in the short term, we will help people try to manage their power consumption, but it’s very difficult to change the cost of providing that power in the short term. We need to look at those immediate things we can do as well as the longer-term picture. Thank you, Mr. Speaker.

Supplementary, Mr. Yakeleya.

Supplementary To Question 106-15(3): Power Rates In Colville Lake

Thank you, Mr. Speaker. When I had a community meeting in Tulita, at Willow Lake, one of the elders mentioned the Great Bear River hydro. They told us we have the power. So he was making a comment that we had the resources in the Sahtu along the Bear River. One of the elders in Colville Lake mentioned to me also that there were alternative ways that the community of Colville Lake could be looked at as a pilot project in terms of reducing power. We have a huge power plant with a limited number of houses using it. The co-op is suffering in terms of making profits. So one of the elders asked if the government would be willing to come in and get some alternative power, generators or initiatives, that could serve the community in terms of not paying out a lot of money out of pocket to the Power Corporation, Mr. Speaker. Thank you.

Minister responsible for the NWT Power Corporation, Mr. Handley.

Further Return To Question 106-15(3): Power Rates In Colville Lake