Kerry McCluskey
Northern News Services

Iqaluit (Nov 29/99) - In a decision that he said made better business sense for the territory, Ed Picco announced last week that Nunavut would form its own power corporation.

The decision brings to an end the long and rather tumultuous process that saw the Government of Nunavut and the GNWT try to decide by March 31, 2000, the fate of the Northwest Territories Power Corporation (NTPC).

Specifically, both parties had to decide if they should continue with their joint-ownership of NTPC or if they would split the corporation into two independent companies.

"The Government of Nunavut has chosen the model of having our own Nunavut power corporation," said Picco, the GN's minister responsible for NTPC.

The announcement last Wednesday afternoon, which came a full four months before the transition agreement required the decision to be made, was based upon information and analysis contained in the report put together by the Ikuma Working Group, a body Picco established in the summer to consider the options and provide him with a set of recommendations.

Made up of representatives from the GN, Nunavut Tunngavik and various utility experts, Ikuma advised Picco on Nov. 1 the best route for Nunavut to take was a solo one.

"The number 1 benefit is that it's Nunavut owned and Nunavut directed," said Picco.

The new power company will take over on April 1, 2001, when the transition agreement that is in place expires. Picco said it would be business as usual until that point, although the planning for the Nunavut Power Corporation theoretically began earlier this fall when a request for expressions of interest went out to power corporations across Canada.

A total of seven providers applied -- including NTPC, Manitoba Power and Quebec Hydro -- and a shortlist with three candidates has been formed. Picco, however, has declined to name them.

The next step he said, was to ask the three finalists to propose what they could do over the next five years to build Nunavut's capacity and to help get the entity up and running.

"We want to go back and say what have you got for Inuit employment opportunities and training programs and can you be responsive and proactive to our needs," said Picco.

The new service provider will be chosen sometime over the next six months and the chief executive officer and the location of the headquarters -- Baker Lake is expected to be named -- will also be revealed.

Picco said the result would be a leaner corporation that functioned at a fraction of the current headquarters costs, provided more jobs and put emphasis on hiring Inuit, and paid attention to much more than just the profit margin.

"It gives us the opportunity to look at building more capacity, more skills, more technical ability in Nunavut. That's good news," said Picco.

But not everyone has welcomed the decision.

"I'm disappointed," said Charles Dent, the NWT cabinet minister responsible for NTPC.

Citing philosophical differences as the key reason for the split, Dent explained that he was afraid Picco's decision would leave ratepayers in both territories paying more for their electricity.

"If you reduce the number of people who pay the headquarters costs for a corporation, that drives up the costs per kilowatt hour," said Dent. "Everyone is going to wind up paying more for their power."

Not so, said Picco.

Nunavut currently generates about 44 per cent of NTPC's revenue. With an independent power company in place, Nunavut will require just one-third of the current headquarters staff and that's a savings that will be passed on to users in the East.

Dent also pointed to the corporate downsizing that would necessarily follow the division of assets and liabilities, but he said he hoped staff wouldn't lose their jobs.

In fact, Dent said he hoped those staff would be able to continue to work and provide the services Nunavut needs if NTPC won the upcoming bid.

"The bottom line is that the Power Corp. is anxious to be selected and we'll offer a good proposal that will cover all the bases to build capacity. We've got the experience working in the territory."