Wednesday, January 12, 2011

Hydro-Quebec, Serious Cold, Dark Winters, and Why a Premier Lost his Job

This blog draws upon material in two New Brunswick newpapers, a Times &Transcript article, Jan. 1, 2011, and a Daily Gleaner article, December 31, 2010.

In the province of New Brunswick, the news story of 2010, possibly of the decade, was the proposed deal to sell NB Power, or at least a large part of it, to Hydro-Quebec. The deal fell through, and analysts are now conducting the post-mortem.

On October 27, 2009, amidst great “fanfare and ceremony,” New Brunswickers woke up to learn that their Premier, Shawn Graham, had struck a deal to sell almost all of NB Power’s generation and transmission capacity to Hydro-Quebec in return for a 30% cut to industry’s rates and a freeze on residential rates. For five years. After that, HQ would set the rates. The deal had to be confirmed in just five months, March 31, 2010. On March 25, 2010, HQ pulled out, and the deal was dead. The NB party in power, the Liberals, lost the 2010 provincial election. Graham is gone.

What happened?

UNB political scientist Don Desserud explains that it was a “bad deal” for NB because the deal makers forgot the most critical point: “the company that provides [NB] with our heat and light in a province that has serious cold, dark winters should not be owned by anybody except the people of the province.” David Alward, leader of the opposition party, condemned the lack of transparency in the negotiation process and predicted that NB would go from “self-sufficiency to self-destruction” if it allowed HQ to take over.  

Further, the surprise announcement to the citizens of New Brunswick stunned, then outraged them. “Where on earth did this come from? It just came out of nowhere, the enormity of the proposal and the clear lack of consultation with people.”

Citizen response to the province’s loss of ownership, unequal treatment of customers, and the secret negotiations began immediately. It came via social media, the internet, and highly visible opposition. A 25,000 member Facebook protest group emerged; multiple marches on the lawn of the provincial legislature in Fredericton occurred, one with upwards of 4,000 protesters. The Council of Canadians, with its web presence, got involved. “These days,” said Energy Minister Craig Leonard, “it’s very easy for people to engage.”

Both Desserud and Leonard conclude that the successful protest has changed the face of politics in NB for a very long time. There are certainly other factors in the death of the deal, but people now feel empowered to turn a government around, and that feeling won’t go away any time soon. Desserud notes that “political parties have to treat the civically engaged public differently because the voters could turn on them en masse in the next election.” Leonard draws the lesson for politicians: “when you plan on doing something that massive, if you don’t consult, if you don’t engage people beforehand, it’s very easy for them to voice their opinion against you.”

Great fanfare and ceremony. The trappings of a coronation, as Jeff Woodburn phrased it.  Surprise announcements. Creating a sense of urgency. Enormous plans. The clear lack of meaningful consultation with the real “stakeholders,” the citizens of New Hampshire. Serious cold, dark winters. The danger of allowing Montreal to call the shots on energy prices and supply in this country when the going gets tough, as it did in the recent drought in Quebec that dropped hydro dam resources by 25%. The parallels between the NB-HQ deal and the proposed Northeast/PSNH-HQ deal are obvious. It’s an old story.

The new actor in it, however, is the engaged, cyber-networked “grass roots” opposition. These days it’s easy to link up with people as appalled as you are and share information, take action. In fact, utilities industry “playbooks” target public opposition as the number one downfall of transmission projects, not the regulators, the terrain, the environment, or any other factor. Public opposition galvanizes political resistance and leads to legal action.

One such playbook warns its corporate clients that utilities used to be able to decide what they wanted to do and largely do it. It was “decide, announce, defend.” With an alert, informed, networked public and deregulation, now it is often “decide, announce, defend, abandon.” Many transmission projects are indeed abandoned as bad deals for the people.

The utilities industry tries to discredit the public opposition that blows the whistle as NIMBY (not in my backyard) sentiment, or even BANANA (build absolutely nothing anywhere near anyone). We’ve heard PSNH trivialize us as NIMBY; perhaps we’ll earn the BANANA badge too before it's all over. But no one really believes this rather desperate effort to minimize the issues. This is about serious cold, dark winters, about not ceding energy control to a foreign government, and about many other critical issues. This is wrong for the White Mountains, as former state Senator Deb Reynolds argues, and a bad deal for all of New Hampshire. New Brunswick figured it out quickly and correctly. So have we.

Bury the Northern Pass, a group of concerned citizens in Grafton County, is a member of the No Northern Pass Coalition. To join the email list, write to