December 9, 1999
(Mines and Energy)

The following statement was issued today by Roger Grimes, Minister of Mines and Energy. It was also read in the House of Assembly:

Today, the government is introducing in the legislature a bill which amends the Electrical Power Control Act and the Public Utilities Act. I would like to take this opportunity to place these amendments in context for the honourable members - in the context of the changes in our electrical industry over the last few years.

There has been an electrical industry in Newfoundland and Labrador for about 100 years, but by the early 1960s, power was in short supply and many communities still had no service at all. Government as a matter of public policy became a major industry participant in the 1960s with the development of Bay d'Espoir and the provincial transmission grid. For the next 30 years, we continued to have sufficient supplies of power for both our residential and commercial uses and for industrial developments through an ongoing program of plant construction by Newfoundland and Labrador Hydro. During that time, decisions on what plants to build were made by Hydro and the elected government of the day.

In 1994, government investigated the possibility of privatizing Newfoundland and Labrador Hydro. Our neighbouring province, Nova Scotia, had just done so. But the people of Newfoundland and Labrador clearly indicated they are more interested in continuing to own their utility than were the residents of Nova Scotia. The government of the time heard their voice, and Hydro continues to be owned by the people of this province.

Likewise, this government also listens to the people. It has no intention of privatizing Hydro. In fact, these amendments are designed to restore Hydro to what government believes, and what it understands the people believe, a Crown corporation should be. Over time, amendments to the various pieces of legislation which govern the electrical industry have gradually moved Hydro in the direction of commercialization - a concentrated focus on the corporation itself and its bottom line - to the point where government can no longer use the efforts of the corporation in the best interests of the public. Through these amendments, government will restore its ability to have Hydro carry out projects which are in the best interests of all Newfoundlanders and Labradorians.

This bill will allow the Lieutenant Governor in Council to exempt specific projects from the need for approval by the Public Utilities Board. At present, this approval process is not able to adequately consider and give weight to the special function the people demand of their public utility. The Electrical Power Control Act and the Public Utilities Act as currently written require Hydro to undertake only those projects that best serve the corporation's bottom line profit objective. This bill, which recognizes the special role of Newfoundland and Labrador Hydro and its unique ability to act in the best overall interest of the province, is in keeping with the approaches employed by almost all other Canadian jurisdictions which own their own electric utility.

In short, the current legislation was developed to accommodate the potential privatization of Hydro. This government has no such intention and is therefore providing for the proper functioning of a publicly-owned utility which the people of this province fully support.

1999 12 09 2:35 p.m.