23 October 2009

Competitive Advantage versus the Albania Solution

New Brunswick and Quebec have some interesting common energy interests, not the least of which is New Brunswick’s electricity interconnection with the United States.

No surprise therefore that the two provinces are talking about co-operation, possibly including the sale of some of NB Power’s assets to Hydro-Quebec.

What  parts of the New Brunswick company might be of interest to Quebec aren’t clear.  One thing is certain, though:  the nuclear division is mired in cost over-runs on the up-grade for the Point Lepreau site.  That might well make it a huge liability for NB Power in any broader sale.

The one competitive advantage the province has is its transmission lines and a strong, continuing relationship with New England customers.  By contrast, Newfoundland and Labrador can’t even figure out if they are still working with Rhode Island.

Expect a local talking point that heads somewhere close to the giant conspiracy theory floated earlier by the Premier.

What you get by putting the real stories together is that NB Power is considerably more attractive than a fanciful project in Labrador that is both far from market and far from existing. A recent Telegram report by Rob Antle [not online] noted that the project is behind schedule in delivering detailed answers as part of the environmental review process.

On top of that it can’t be discounted that political tirades by the current administration have poisoned the relationship with other provinces.  things are evidently so bad that even a willingness by Danny Williams to completely abandon his “redress” position and offer Hydro-Quebec an ownership stake in the Lower Churchill didn’t get even a sniff of interest from the Quebec Crown corporation.

Isolation is not good for Newfoundland and Labrador’s long term interest. The New Brunswick-Quebec connection demonstrates that pretty clearly.