NB Power: Now accepting resumes.
The more things change, the more things stay the same at NB Power. With the lastest news indicating NB Power may have to raise rates as the price of a barrel of oil is less than half it was 6-8 months ago, one has to ask, are the executives at the utility incompetent or in on a joke we do not get.
No matter the situation, an excuse to raise rates is always found. Or is it the only answer they have? Whether it is high debt to the province, Orimulsion deals gone bad, High oil prices, now low oil prices, might we simply assume those guiding the ship are not suited for the ever changing characteristics of the sea. If this group of executives cannot navigate an ever changing world why are they there?
"Hay says NB Power does not think it can predict volatile commodity markets well enough to move away from its hedging policy."
The above quote is absolutely frightening. If NB Power does not feel it has the resources or capacity to create a better strategy in dealing with volatile commodity markets, pick up the phone and contact any number of companies dealing with the same issue. Ask questions, remember there is no such thing as a dumb question. Were they told them to do it alone? One company comes instantly to mind, Westjet. Here is a company whose ability to hedge their fuel purchases has allowed them to remain extremely competitive in an industry where survival is closely based on how they manage their fuel supplies. Their last option is to increase prices, not their first option, as seems to be the only option at NB Power.
Continuing along the lines of 'thinking out of the box' (God, I hate that phrase). In an effort to deal with the massive debt, often cited by officials as a cause for increases, why not renegotiate? NB Power is not going anywhere nor is the Province of New Brunswick, lengthening the terms would not seem much of a risk. Even more creative ideas are on the table. Don't forget the precedent set by the province, who is willing to convert debt to shares (SEE Royal Oaks Golf and Country Club). At least with NB Power, the province will have a legitmate chance of a return on the investment.
Why was their no mention by NB Power of the benefits the utility should be experiencing due to the decrease in the dollar's value. Based on the premise states forming New England states are paying for our energy in US dollars, the assumption NB Power stands to earn a premium from those contracts is a valid one. Further more, are the southern cusotomers of NB Power going to experience a rate hike as well or is a better deal in place for them?
Indeed the executives should have a mandate to keep their house in order. However, further incentives should be in place to deviate from the status quo. Simply having the consumer as the safety-valve to more cash should not be part of the equation.
Comments (5)
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You said 'people need learn to conserve their use of electricity rather than slam NB Power for mismanagement and asking for the province to lower rates'
Umm I will slam NB Power for mismanagement because it is mismanagement that has sunk the utility into debt.
How about ore emulsion? How much did that cost?
How about NB Coal? How much waste is there in Minto?
How about Beldune? over 1 Billion dollars for a dinosaur.
How about Pt. Lepreau? Drop any generators into the ocean lately?
I will complain because IT IS mismanagement that has caused this. Make NB Power a private company and sell shares on the stock market...ooh wait...the government ruined that too!
The Mad Ape
www.tatumba.com