B.C. gains from Alberta power misfortune

By Mabell, Dave on October 24, 2014.

Dave Mabell

Lethbridge Herald

[email protected]

Albertans are being gouged by their electrical system, and it’s their politicians’ fault.

That’s the verdict from one politician, who’s become its vocal critic.

The made-in-Alberta pricing system, MLA Joe Anglin says, guarantees Alberta’s power generators the highest possible price. And while Alberta consumers are forced to pay more and more, he told a Lethbridge audience, British Columbia residents are benefitting from our misfortune.

Meanwhile, Alberta consumers are picking up the bill for a deliberately overbuilt transmission network, Anglin told a session of the Southern Alberta Council on Public Affairs. No wonder American billionaire Warren Buffett wants a part of the action.

“There are so many questions, and so few answers,” Anglin said, yet the Conservative government is taking no steps to halt the sale of the province’s largest transmission network to one of Buffett’s companies. In every other jurisdiction, the province owns or controls its transmission lines.

Southern Albertans should not believe assurances that the high-capacity loop now being built here is just for local customers, he maintained.

“They’re reinforcing it to export a significant amount of power.”

Buffett’s empire includes power facilities in Montana, Anglin claimed. Once it controls most of the Alberta network, it will be able to maximize profits by sending Alberta power south – or importing it when the price is right.

Within Alberta’s layers of utility regulation bureaucracies, he said, there are no provisions to control sales across the border.

“That’s a problem with multi-national companies.”

Anglin, the Wildrose MLA for the Rocky Mountain House area, said Alberta residents are already paying – but British Columbians are winning – from the Alberta bureaucracy’s inability to control interprovincial sales. Overnight, he said, publicly owned BC Hydro buys excess Alberta power sent through the Crowsnest Pass, for about three cents per kilowatt hour.

That allows the B.C. utility to conserve water stored behind its hydro dams – while selling Alberta power to American utilities. During peak daytime hours, he explained, BC Hydro sells power to the Alberta grid for six cents per KWH.

“BC Hydro is ‘gaming’ the system in Alberta.”

A questioner from Saskatchewan reminded Anglin that province’s public utility generates the power, carries it to Saskatchewan communities and retails it to residents and businesses – then pays a dividend to the taxpayers. The Alberta system is “mind boggling.”

The jury is still out whether Alberta consumers find any advantages in their system, Anglin said. But the new premier must address some of its greatest weaknesses.

One of those, he said, is the auction-like method by which power generators set their prices through the day. It’s a little like a cattle auction, he said, where every buyer is forced to pay the price obtained by the best animal in the ring.

For Alberta’s longtime power producers, “It’s a licence to print money.”

The current system, brought in during Ralph Klein’s days as premier, was copied from some American jurisdictions, Anglin said. But many have abandoned “deregulation since then.

The reason Albertans are still forced to pay and pay, is that elected officials are unable or unwilling to face the big questions. Albertans can only hope they will, he added.

“When they politicized the system, they made a mess of it.”