Hay River Mayor defends move toward power corp
Northland challenges GNWT- owned utility to make its proposal public
Paul Bickford
Northern News Services
Monday, March 14, 2016
HAY RIVER
Hay River town council's decision to opt for a different power distributor wasn't easy but it was the best decision council could have made, according to Mayor Brad Mapes.
Council voted to take the next steps for Northwest Territories Power Corporation to acquire the electrical distribution system and franchise agreement in the community March 3.
The town and the corporation say once that happens, customers could expect an overall decrease of about 20 per cent in the cost of electricity.
"The whole idea of what we're trying to achieve is trying to find the cheapest power cost for our community," said Mayor Brad Mapes.
The decision follows a request for proposals in May for the supply and distribution of electricity within the town.
The council vote was not unanimous, as Coun. Steve Anderson opposed the measure.
Anderson told News/North his concern is there's nothing to say how long a 20 per cent reduction would be in place.
"If anybody wants to come into the Hay River market, be it a retailer or whatever, they're going to lowball the price just to get in," he said. "What I'm concerned about is what is the price going to be in five years. Nobody is going to know."
Emanuel DaRosa, president and CEO of NTPC, said the 20 per cent cost reduction is a conservative estimate.
"We would certainly much rather under promise and over deliver, rather than the other way around," he said.
"There are significant savings to be had but those will be determined ultimately by what we have to purchase the assets for."
Rates are made up of three components - wholesale, distribution and back-up generation. The rate for wholesale power, which NTPC provides to Hay River from the Taltson River hydro site, is regulated by the Public Utilities Board.
The town and NTPC say the cost of distribution would be reduced more than 30 per cent, while back-up generation would be reduced in excess of 15 per cent.
Doug Tenney, vice-president for Northern development with Northland Utilities, said no value has been placed on the distribution system, although he has previously put the price tag of Northland's territory-wide assets at $180 million.
He said that process of determining a price won't begin until the existing franchise expires on Nov. 30.
"The franchise agreement does contemplate that kind of a situation happening," he said.
"We would carry on for whatever period of time it took the third-party arbitrator to come up with the price."
Tenney said the public should be able to see the proposals put forward by the two companies, and Northland Utilities has put its proposal online.
DaRosa said NTPC has no plans to put its proposal online.
The town received a total of three responses to its request for proposals.
