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Hydro-Québec to buy key NB Power assets


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http://ca.news.yahoo.com/s/cbc/091029/cana...power_deal521_1

Hydro-Québec will pay an estimated $5 billion to purchase NB Power's nuclear and hydro generating stations, the transmission system and other assets in a massive deal set to be announced on Thursday.

The combined value of the agreement is estimated at $10 billion, with the remaining $5 billion being attributed to rate relief that will be provided by the deal.

I don't know enough about the deal to say if it is good or bad.

It does look like the other Atlantic provinces are furious at New Brunswick for doing this though.

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http://ca.news.yahoo.com/s/cbc/091029/cana...power_deal521_1

I don't know enough about the deal to say if it is good or bad.

It does look like the other Atlantic provinces are furious at New Brunswick for doing this though.

Looks to me like Hydro Quebec is looking to gain even more control of energy transmission to the USA. Ask NFLD how well it will work out for NB.

Hydro Quebec is a major reason why I think the Federal Government should own and control the power grid. As HQ is blocking Hydro-electricity development in Labrador....

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Hydro Quebec is a major reason why I think the Federal Government should own and control the power grid. As HQ is blocking Hydro-electricity development in Labrador....
How naive you are.

Since one level of government doesn't do what you think is right, you believe that another level will be wiser and make better decisions. As the young optimistic boy said on Christmas Day, "With all this horseshit, there must be a pony buried here somewhere."

----

My thoughts on this deal?

1. Hydro-Quebec is a société d'État - a Crown corporation. It works nominally for Quebec politicians who nominally work for Quebec voters. When it comes to Hydro-Quebec, think Russia's Gazprom.

2. When push comes to shove, Hydro-Quebec managers care more about Quebec politicians than they do the so-called bottom line. (eg. La Caisse.)

3. Hydro-Quebec, like Gazprom, is sitting on a wonder of the world. It can afford to sell electricity to Quebecers at Venezuelan gasoline prices, have a huge, stagnant bureaucracy and still turn a "profit". Is this the kind of management that NB Power wants?

3a. I can understand why Hydro-Quebec would subsidize Quebec taxpayers, it is less obvious to me why it would subsidize New Brunswick taxpayers. (Please don't say that a NB HQ subsidiary would be subject to NB government regulation.)

4. The NB PC opposition has asked for an election on this deal and said that it will obstruct it in the legislature. Without knowing anything about NB politics, I suspect that ordinary people in NB understand this deal well.

5. Wrong or right, Hydro-Quebec has a bad reputation in English-Canada and in the Maritimes in particular because of Churchill Falls. Reputation matters in business dealings of this sort and Hydro-Quebec will now suffer because of perceptions of its past behaviour.

6. Technical point. North American electricity is 120 volts, 60 Hz. This means that electricity in North America switches between + and - 60 times a second, identically everywhere from Winnipeg to Los Angeles - except in Quebec. Quebec has 120 volts, 60 Hz AC as elsewhere but it switches +/- at its own rhythm

Hydro-Quebec cannot directly join the the NB grid and so I wonder what HQ's intentions are?

Edited by August1991
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Hydro-Quebec cannot directly join the the NB grid and so I wonder what HQ's intentions are?

I fail to see how that is true. Hydro Quebec exported $1.1 billion US worth of energy outside of Quebec last year so that can directly export their energy.

It is clear what their intentions are it is too freeze Nfld out of exporting to the US with out going through Quebec who would charge them a carrying fee. It is genius.

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Looks to me like Hydro Quebec is looking to gain even more control of energy transmission to the USA. Ask NFLD how well it will work out for NB.

I'm sure NB, in the short term, will do well enough. It's Newfoundland that's getting screwed.

Hydro Quebec is a major reason why I think the Federal Government should own and control the power grid. As HQ is blocking Hydro-electricity development in Labrador....

Ain't gonna happen. It's a provincial responsibility up to the border, and there's no way in hell that Ottawa is going to freak the Americans out by messing with supply.

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I fail to see how that is true. Hydro Quebec exported $1.1 billion US worth of energy outside of Quebec last year so that can directly export their energy.
Hydro-Quebec has designated generators and transmission lines for its exports to the American phase.

I know that Hydro-Quebec can export electricity. I merely wonder how it will cope with NB Power.

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It is clear what their intentions are it is too freeze Nfld out of exporting to the US with out going through Quebec who would charge them a carrying fee. It is genius.
Huh?
I'm sure NB, in the short term, will do well enough. It's Newfoundland that's getting screwed.
Huh?

----

Newfoundlanders believe that they are rich because there is a large waterfall in Labrador. Well, I believe that I am rich because I have found caviar on the Moon. Unless the caviar is brought to a Manhattan restaurant, my caviar on the Moon has no value. And electricity in Labrador is like caviar on the Moon - it has no value. Newfoundlanders simply cannot understand this.

The critical resource of value is not the waterfall, but access to a market. Because of Hibernia, perhaps Newfoundlanders now understand this.

Then again, it's hard to teach risk-taking fishermen anything.

Edited by August1991
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Island people? They're impossible.

Think Newfoundland knows what Quebec has their eyes on.

http://www.cbc.ca/canada/newfoundland-labr...c-labrador.html

However, a map attached to survey results — posted on the website of Quebec's Natural Resources Department — shows large parts of southern Labrador as being inside the Quebec boundary.

John Ottenheimer, Newfoundland and Labrador's minister of intergovernmental affairs, said the map is the latest in a line of claims that Quebec has made about its boundary and Labrador.

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Well, lo and behold...

Emera mum on talks with Hydro-Quebec

http://thechronicleherald.ca/Business/1150179.html

Emera and its subsidiary, Nova Scotia Power, are staying tight-lipped about Hydro-Quebec’s reported interest in taking over the power company.

A report in Thursday’s Globe and Mail quotes an unnamed Quebec government official as saying Hydro-Quebec, a Crown-owned utility, is looking at buying Nova Scotia Power.

There is legislation in Nova Scotia to present a takeover. Guess it is okay for Emera to buy other people's energy assets but not have someone buy theirs.

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The Trojan Horse !

It is an evidence that current Quebec's PM Jean Charest made a huge "coup" with yesterday's

Hydro Quebec's Memorandum Of Unterstanding confirming the intention to acquire NB Power.

Strangely the Rest Of canada ( ROC ) did not see it coming at all and are now "surprised"

and "trapped" with a very big problem to come for them.

Yesterday's Quebec ( pop.7,750,704 ) strategic move in New Brunswick is only the begining, Prince

Eduard lsland ( pop.140,402 ) and Nova Scotia ( pop.935,962 ) electrical power plans being future

easy targets to acquire by Hydro Quebec.

The ROC like Quebec when it is silent, quiet, smaller and smaller, more and more bilingual and

generally less and less important within the Canadian Federation.

Most recent events indicate a turn for Quebec to compensate its future decrease of influence

within the Federation with the coming redesign of the federal electoral map proposed by the current

canadian government.

Quebec is now using other tactics to maintain and even increase its weight and influence within

the Canadian Federation and the current target is the Maritime provinces.

The choice of moves toward the Maritimes is also strongly symbolic, NB, PEI and NS having french

speaking "Acadiens" minorities on all 3 provinces.

If the Canadian Government follows Newfondland's PM wishes and try to block the Hydro Quebec

NB Power transaction and succeed, the reaction within Quebec province will be so huge that the

support for the separatist movement for a fully Independant Quebec, will dramatically increase

implying more and more votes for the Parti Québecois and the Bloc Québecois and even a new

( winning ? ) Referendum for Independance within the next 5 to 10 years.

If the Canadian Government permits the transaction, the separatist movement will continue to

decrease within "La Belle Province" but ...... it will create a "case law" within constitutional Canadian's

history that will freely open for Quebec similar transactions to buy PEI and NS power plans.

Quebec increasing influence on the Maritime provinces will then be a "cold" fact that the rest of Canada

will have to accept and deal with, in exchange for a stronger case for canadian national unity.

In fact, most recent Quebec's boldly move toward the Maritimes and future other moves is a real Trojan Horse,

most probably meaning the begining of the a new type of Independance for Quebec .......not by separation ...

...... but from within the Canadian Federation structure.

On thing sure, narrow minded attitudes againts Québec, like Nfld PM Danny Williams who would stupidly ignore

Quebec if he could and put it out of the the Canadian Equation have no longer any future at all.

VaporZ

Rimouski

Quebec

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There is legislation in Nova Scotia to present a takeover. Guess it is okay for Emera to buy other people's energy assets but not have someone buy theirs.

What legislation is that? Could be, but I thought Nova Scotia privatized power along time ago. I'd like to see the restrictions that hold it at 15%.

Edited by madmax
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What legislation is that? Could be, but I thought Nova Scotia privatized power along time ago. I'd like to see the restrictions that hold it at 15%.

The legislation is in place to hold it at 15%.

Nova Scotia has legislation in place that bars any company from owning more than 15 per cent of Nova Scotia Power...

From the Chronicle.

Edited by jdobbin
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  • 2 months later...

I love the picture in this article?

How will this effect NB electricity delivery?

http://www.theglobeandmail.com/news/politics/in-revised-deal-nb-power-to-retain-some-assets/article1435619/

Is this a good event or a bad one.

Hydro Quebec is pretty big, it does have me wonder why hydro1 quebec hydro etc... exist provincially, why isn't there a federal power crown corp?

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You're stereotyping based and then criticizing based on your particular world view. I don't know what else to call that.
In theory, the federal government regulates international and cross-provincial transmission of electricity.

In the case of Churchill Falls, what Newfoundlanders fail to understand is that the valuable resource is not the Falls; the valuable resource is the ability to transfer this energy to people who want it. That is why Quebec earns the large share of the Churchill Falls contract, and why Quebec will also earn a large share when the contract is renewed in 2041.

In effect, it is Quebec that has the rare resource - not Labrador. Quebec provides a way to get the energy to market. What would be the value of gold or caviar on the moon? If you can't bring a commodity to market, to people who want it, you have nothing. (And for heaven's sake, the Falls are not even in Newfoundland.)

If the Canadian Government follows Newfondland's PM wishes and try to block the Hydro Quebec NB Power transaction and succeed, the reaction within Quebec province will be so huge that the support for the separatist movement for a fully Independant Quebec, will dramatically increase...

If the Canadian Government permits the transaction, the separatist movement will continue to

decrease within "La Belle Province" but ...... it will create a "case law" within constitutionalis a question Canadian's history that will freely open for Quebec similar transactions to buy PEI and NS power plans.

It is sad that for some people, every political issue can be narrowed to a question of Quebec independance.

When such people dominate a society, then the society is frozen. Such is Quebec today.

Edited by August1991
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In theory, the federal government regulates international and cross-provincial transmission of electricity.

In the case of Churchill Falls, what Newfoundlanders fail to understand is that the valuable resource is not the Falls; the valuable resource is the ability to transfer this energy to people who want it. That is why Quebec earns the large share of the Churchill Falls contract, and why Quebec will also earn a large share when the contract is renewed in 2041.

Not quite!

http://www.canada.com/montrealgazette/story.html?id=17f52755-7ede-45a5-8b2f-6a8b7d004957&k=46670

"In the 1960s, Newfoundland began talks with Hydro-Quebec to sell power from Churchill Falls, because Quebec would not allow Newfoundland to transmit the power through Quebec to other markets.

Quebec still gets power today at bargain-basement prices from Churchill Falls, and has a legally binding contract to do so for a total of 65 years, until 2041.

That contract was initially designed to last only 40 years, from 1976 (the year Churchill Falls power came onstream), to 2016.

According to the new study, a letter of intent, or draft contract, signed between Hydro-Quebec and CLFCo in 1966 gave each side the option of renewing the contract - under mutually agreeable terms and fresh negotiations - upon its expiry in 2016.

By 1968, however, after years of negotiating under such terms, Hydro-Quebec suddenly altered its demands, only months before the final deal was signed.

It wanted an automatic renewal of the contract, without negotiations, for another 25 years starting in 2016. And it wanted a guaranteed price even lower than the original price paid before the renewal.

"That's like me asking you, 'Why don't you agree to sell me your product at a lower price than prevails today, starting 50 years from now and continuing up to 75 years from now," Feehan said. "It's so incredible, you wonder how anyone could have conceived it." "

So your model is not quite accurate. What would you say about an American company making a deal for a gold mine in a third world country that did not have the resources to mine it themselves? Let's suppose that this deal gave the country an absurdly low price for the gold, like $10 per ounce. Let's further suppose that America was able to get a 25 year deal extended for another 25 years, for $5 per ounce!

"In a speech in 1996, former Newfoundland premier Brian Tobin estimated that Hydro-Quebec received windfall profits of $1.4 million a day from redistributing Churchill Falls power. He said Newfoundland and Labrador, the resource owner, received only $45,000 a day."

You argue like a skinflint lawyer, sir! Quebec's deal may have been perfectly legal but nobody likes a skunk at a picnic.

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  • 2 weeks later...

"In a speech in 1996, former Newfoundland premier Brian Tobin estimated that Hydro-Quebec received windfall profits of $1.4 million a day from redistributing Churchill Falls power. He said Newfoundland and Labrador, the resource owner, received only $45,000 a day."

Time to build a really big dam.

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So your model is not quite accurate. What would you say about an American company making a deal for a gold mine in a third world country that did not have the resources to mine it themselves? Let's suppose that this deal gave the country an absurdly low price for the gold, like $10 per ounce. Let's further suppose that America was able to get a 25 year deal extended for another 25 years, for $5 per ounce!
Your comparison betrays your bias, and ignorance.

Is there only one American company that has the resources to mine the gold, as you put it. Why? Presumably many foreign companies can mine the gold and will compete for the contract.

The gold mine is the rare resource - and its owner will be rich.

In the case of Churchill Falls, the rare resource is not the waterfall - it's the ability to transmit the electricity to a market where people want to buy it.

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Your comparison betrays your bias, and ignorance.

Is there only one American company that has the resources to mine the gold, as you put it. Why? Presumably many foreign companies can mine the gold and will compete for the contract.

The gold mine is the rare resource - and its owner will be rich.

In the case of Churchill Falls, the rare resource is not the waterfall - it's the ability to transmit the electricity to a market where people want to buy it.

Encore, M l'enfant de Voltaire, I am not quarreling with the legalities. There was a time when it was legal to rape your wife.

You've expressed the lawyers' view quite adequately. I'm saying that to anyone who is NOT a lawyer the entire deal reeks terribly!

What's more, someday Quebec will not be able to extend the deal any longer. Or they will need Newfoundland's support on some other project.

At that time expect Newfoundland to exact their revenge!

Do unto others as they have done unto you. It's the only way to teach some people!

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