NB Power deal with Quebec scrapped but New Brunswick's energy woes still remain

The controversial deal to sell NB Power is now off the table but the question of how the province will tackle the tough energy challenges that lie ahead still remains unanswered.

New Brunswick Energy Minister Jack Keir said last Thursday he was frustrated the deal with Hydro-Quebec had broken down because he believed it was a viable solution to the province's long-standing energy worries.

"I was probably the most disappointed New Brunswicker in the province yesterday," said Keir in a phone interview a day after the government announced it would not be proceeding with the proposed energy agreement.

He insisted the deal with Quebec would have helped NB Power manage its multi-billion dollar debt, looming rate increases, and future refurbishment costs for the province's power plants. Without it, however, the province is back to square one.

"The problem isn't going to go away, this problem has been around for a while," said Keir.

"So now it's incumbent on us to come up with another solution."

Negotiations between New Brunswick and Quebec came to a head early last week after a number of concerns were raised by Quebec over some of the risks it would be taking on in the agreement.

According to the Liberal government, Hydro-Quebec asked for unacceptable changes to the agreement that would have taken away some of the value and increased some of the risks for New Brunswickers.

Now that the deal has collapsed, Keir said the government will need to make some monumental decisions on how it will move forward from here.

But he admitted it won't be an easy task.

"If there was an easy solution to this, it would have been done long ago," he said, noting that the utility's burgeoning debt and its reliance on fossil fuels have been issues up for debate since Frank McKenna's days in government.

For now, Keir said he has asked NB Power's interim CEO Gaetan Thomas to find short-term efficiencies within the organization to mitigate the coming rate increases as much as possible.

"But we still have to come up with a long-term solution," he said, pointing out that even those who opposed the deal over the past five months have acknowledged that the status quo can not be allowed to continue in the province.

Tantramar Conservative MLA Mike Olscamp said although he agrees that changes are definitely needed in order to reduce the utility's debt and the province's dependence on more expensive fossil fuels, he isn't convinced that the Liberals' proposed deal with Quebec was the best way to achieve those goals.

Olscamp said he's pleased the deal has been scrapped because of the concerns that were brought to him by many of his constituents.

"We were hearing from the public that there were too many 'ifs' in the deal, too many unanswered questions," he said.

Olscamp said he thinks the deal lacked a long-term energy policy vision, and it was seen by many New Brunswickers as a "quick fix" to the province's energy woes.

"There are problems there, there's no doubt about that; something's got to change."

Whether it's through a partnership deal or a power purchase agreement, Olscamp said the Conservatives are looking at all possible options and "will present a policy when it makes sense."

"At the end of the day, there's a problem and we need to deal with it."