Owen Sound Sun Times
January 15, 2015
Group questions Bruce Power negotiations
The Ministry of Energy says its negotiators are acting in the best interest of ratepayers in ongoing negotiations with Bruce Power after a renewable energy advocacy group raised concerns about the process.
The Independent Electricity System Operator and Bruce Power are currently negotiating a commercial framework for the purpose of refurbishing six units at the Bruce Power nuclear generating station, but the Ontario Clean Air Alliance claims the agency negotiating on behalf of the province is in a conflict of interest and it wants public hearings held to look into the deal.
OCAA chairman Jack Gibbons said Wednesday that many employees of the IESO are members of two unions that have ownership stakes in Bruce Power — the Power Workers Union and the Society of Energy Professionals.
“There is an apparent conflict of interest, so the politicians shouldn’t necessarily accept everything their civil servants tell them,” said Gibbons. “If this is really a good deal, then there will be no problems about an Ontario Energy Board review, because the OEB review will confirm it is a good deal, and that will be a very useful process, because obviously there are a lot of people who question it is a good deal.”
But a spokeswoman for Minister of Energy Bob Chiarelli, stated via e-mail on Wednesday that the province is taking steps to ensure that the terms of any deal between the province and Bruce Power are in the best interest of ratepayers.
“Any agreement between IESO and Bruce Power must adhere to the seven refurbishment principles outlined in the 2013 (Long-Term Energy Plan) aimed at mitigating ratepayer risk and maximizing ratepayer value,” ministry spokeswoman Jennifer Beaudry wrote in the e-mail. “Any agreement must also pass both technical and financial scrutiny before being submitted to the government for approval.”
Beaudry also denied there was a conflict, stating that the IESO negotiating team is led by a third-party industry expert who reports directly to non-unionized senior IESO management.
“All decisions around the negotiations including strategy and outcomes are contemplated and made by non-unionized senior management and the agency’s Board,” Beaudry wrote.
Gibbons said the OCAA believes that unionized staff members will be providing analysis and briefing notes for the negotiators.
“I am sure that some unionized staff are providing advice about the negotiation, about what the cost for alternatives are like water power from Quebec, what the cost of alternatives are like energy efficiency or wind power,” said Gibbons.
“I am sure unionized staff are involved in this and they seem to be in an apparent conflict of interest as their unions own 7% of Bruce B and presumably they are getting dividends now . . . and presumably if the deal is signed, the dividends per employee will rise substantially.”
Gibbons said the OCAA has done some calculating and estimates that the value of such a contract would be at least $60 billion.
“Those figures are if Bruce Power comes in at what OPG says the Darlington rebuild will cost, but no nuclear project in Ontario has ever come in on budget,” said Gibbons, who wants public hearings into the contract so members of the public can cross-examine Bruce Power and the government so “we can be absolutely sure that what we are doing is in the best interest of Ontario electricity consumers.”
Beaudry wrote that independent reviews of the contract will be conducted to assure both the government and ratepayers are adequately protected, but Gibbons said that is not enough.
“It is not going to be public, it is going to be some consultant the government has hired, and consultants the governments hire to do independent reviews always conclude the government did the right thing,” said Gibbons. “We need a real public review where the citizens of Ontario can intervene, participate, cross-examine.”
Bruce Power spokesperson John Peevers declined to comment on the matter.
Bruce Power has plans to refurbish six of its reactors in the future, after close to $5 billion was spent on the refurbishment of Bruce A Units 1 and 2, which was completed in late 2012. The next round of refurbishments is expected to start in 2016, last about 10 years and cost in the area of $15 billion.
Peevers wrote in an e-mail that Bruce Power expects the units to have a life of an extra 30 years “when and if they’re refurbished.”