Lethbridge Herald
OUR EDITORIAL: WHAT WE THINK
THURSDAY, DECEMBER 4, 2014
It is now official — AltaLink is in the hands of Berkshire Hathaway. Last week, the Alberta Utilities Commission (AUC) and Industry Canada greenlighted the sale, with a price tag of $3.2 billion, which in the end gives a foreign company ownership of some very critical infrastructure in the province. AltaLink transmits electricity to 85 per cent of Albertans, and now Berkshire Hathaway will have a large hand in shaping that process for the foreseeable future. Approval was given despite criticism from Alberta’s opposition parties, and several market observers, who raised serious concerns at the possible implications. Earlier this year, former Wildrose MLA Joe Anglin, one of the most outspoken opponents of the proposal, said it will now be an American corporation who will benefit from our “deliberately overbuilt transmission network,” which could pave the way for Berkshire Hathaway to maximize its profits by sending Alberta power south of the
border when the price is right. With few safeguards in place to control electricity sales across borders, Anglin was fearful Albertans would face a future of price instability, brought upon us through the Progressive Conservative government deregulation scheme, which has created what he called an auction like method whereby power generators set prices throughout the day.
Albertans have reaped the consequences of this system, particulary during periods of peak power demand in the summer, when prices skyrocketed. Attempts have been made to better inform the public of this fluctuation, and an Edmonton-based company, Gray Energy Economics, has even created the Alberta Power Price app, which constantly provides real-time power price information. But it appears most Albertans have simply resigned themselves to the fact
this province’s system will continue to operate in a manner unlike those witnessed across Canada, where provincial ownership or control of their transmission lines is commonplace. It is a different world in Alberta, however, where giant corporations often rule the day, and agencies like the AUC, tasked to regulate the system, often fail to protect everyday Albertans. For its part, the AUC, in its Nov. 28 ruling, approved the sale based on its “no-harm test” for financial impact on customer rates and service quality.
The AUC maintained it will continue to regulate AltaLink in the same manner, and suggested the sale to Berkshire Hathaway would have a positive impact on customer rates, because of the financing capacity of its new owner, with
AltaLink still in the process of a large transmission build. Having the ability to purchase and sell assets is necessary to ensure continued investment in energy transmission and foster a stable investment climate, AUC continued in its ruling. That appears to be the company line anyway, similar to the assertion deregulation would create a competitive energy market, and create investment in new energy plants, two outcomes which have failed to develop. The AUC also downplayed fears AltaLink could export electricity to the U.S., as it maintained the company is a mere conduit through which market participants purchase and sell electricity , and AltaLink simply does not buy sell or own electricity. In the same breath,
the AUC added it does not have jurisdiction over electricity commodity pricing; however, it does control pricing of transmission services. However, a quick examination of Albertans’ power bills, and the rising delivery charges and rate riders, show just how effective the AUC has been fulfilling that responsibility. In the end, it is very possible Albertans will continue to pay the price for a deregulation scheme which has simply not had its desired impacts. The sale of AltaLink, a company which generated profits of over $107 million last year, according to the Alberta NDP, is another example of a system gone awry.
