P.E.I. Energy Accord details released
New details about the P.E.I. Energy Accord were announced Tuesday in the legislature, including information about the government's increasing investment in wind energy.
The accord is a new five-year power purchase agreement between Maritime Electric and NB Power.
The accord's main goals are: electricity rate reduction, rate stability and the development of P.E.I. into a world leader in wind power.
Premier Robert Ghiz announced at a press conference outside the legislature that the government will increase its locally owned and produced wind power capacity to generate more than 30 per cent of the province's energy requirements by 2013.
The premier also said Tuesday that the public will have a say in the province's future energy needs. Ghiz is establishing a new commission on the future of electricity. It will be comprised of non-partisan members, including federal officials.
Announced on Friday, the energy accord will bring lower and stable electricity rates for the next five years.
A 14 per cent rate decrease will come into effect in March 2011.
In the legislature, Opposition Leader Olive Crane said the accord was wrapped in secrecy.
"IRAC [Island Regulatory and Appeals Commission] was going to do what they normally do, when the prices go up, they adjust them, when the prices go down, the savings are there," said Crane. "So, premier, please tell us why are you trying to pull a fast one on Islanders?"
Debt takeover questioned
Crane questioned why the government plans to borrow at least $35 million to assume Maritime Electric's debt over the next two years.
The premier has said the province will use its borrowing power — because it can get a better interest rate — to help Maritime Electric pay the extra energy costs being incurred while New Brunswick's Point Lepreau nuclear power plant is refurbished.
New Brunswick provides 80 per cent of P.E.I.'s electricity.
Ghiz insisted that if the province had not negotiated the new five-year energy deal with New Brunswick, rates would not drop 14 per cent.
"The fact of the matter is, madame speaker, if the province did not step in and offer our better interest rate the ratepayers of Prince Edward Island would not be getting as much as a reduction as they are getting now," Ghiz said in the house.
Ghiz estimated that ratepayers would save $25 million annually.
Fred O'Brien, Maritime Electric's CEO, was also at Tuesday's press conference to formally endorse the energy accord.
"In my estimation, we would not have reached the 14 per cent had we not come to this arrangement," he said.
Allowing more power suppliers to bid to sell power to the utility drove the price down and made the rate decrease possible, O'Brien said.
With files from The Canadian Press