Keir says Hydro-Quebec to inherit Lepreau woes
Published Thursday November 5th, 2009
New Brunswick taxpayers will save $275 million in replacement fuel costs caused by the problem-plagued Point Lepreau refurbishment under the proposed deal to sell NB Power to Hydro-Quebec, says Energy Minister Jack Keir.
Keir said Hydro-Quebec will be responsible for all Lepreau power replacement costs after March 31.
"Hydro-Quebec would take on that risk and responsibility for providing that replacement fuel," he said Wednesday.
NB Power and the provincial government originally budgeted $400 million to purchase replacement power while the Point Lepreau nuclear power plant was undergoing an 18-month refurbishment.
The project is now projected to take 36 months and Keir said the province and NB Power were looking at a bill for another $400 million, for a total of $800 million.
Atomic Energy of Canada Ltd. (AECL) is responsible for cost overruns of the refurbishment but not replacement power.
Point Lepreau generates 635 megawatts of power, which is enough to supply 30 per cent of the province's needs.
Electricity generated by nuclear power is the cheapest source after hydro.
Keir said the projected cost of replacing the energy generated at Point Lepreau between Sept. 30 and March 31 - when the deal to sell NB Power is expected to be signed - is $125 million.
That means the province would end up paying $525 million, not $800 million, he said.
"I think it is important we get the facts out there, that folks understand not only what the opportunities are with this MOU (memorandum of understanding) but what the status quo means," said Keir.
The savings could be even higher if the Lepreau refurbishment isn't complete after 36 months because all that risk is transferred to Hydro-Quebec, he said.
"I am not going to stand up and commit on behalf of AECL ever again," said Keir. "AECL let me down once in terms of what they believed was a good schedule."
But he said he believes in the people working on the refurbishment in Saint John.
The memorandum of understanding also states if Point Lepreau doesn't work after its expensive refurbishment, Hydro-Quebec doesn't take ownership of it and all expenses - including the replacement power costs - reverts back to New Brunswick.
But Keir said that would be the same situation if NB Power wasn't sold to Hydro-Quebec.
And if Lepreau doesn't work after the refurbishment?
"My guess is there would be a wonderful battle with AECL and the federal government on why that did not occur," said the energy minister.
He said he's confident that the project will be successful.
Keir also said he will pursue the federal government to recover the $125 million in unbudgeted replacement power costs from Ottawa.
"The debate will still be on with the federal government," he said.
Official Opposition leader David Alward said the savings don't change his opinion that the sale of NB Power is a bad deal.
"I don't think there is any news today," he said Wednesday.
Alward said the Opposition expressed worries about the Lepreau refurbishment months ago and sought an investigation but was told there were no problems.
"People should be a little bit cynical about the minister on this," said Alward.
"The minister of energy is nothing more than a snake-oil salesman."
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Wait a minute, aren't you the same guy who wouldn't hear anything on using renewable energy sources and that refurbishing was the only way to go and that we should build a lepreau 2?
"I am not going to stand up and commit on behalf of AECL ever again," said Keir. "AECL let me down once in terms of what they believed was a good schedule."
I'm going to bookmark this page to see how long before you start lobbying for them again.
Watch Shawn and crew next, they'll try to sign the deal as quickly as possible so we can't get out of it, and certainly won't let the public decide. Then they'll leave the province and get cushy jobs at Hydro Quebec.