Nunavut’s MLAs press QEC on rate hikes, billing, remediation

Arviat North-Whale Cove MLA John Main, left, says it is frustrating that Nunavummiut have inherited contaminated soil from power plants run by past governments. The QEC is only legally required to remediate these messes when public health is at risk. (PHOTO BY BETH BROWN)

It’s too soon for the Qulliq Energy Corp. to say how its operations will be affected by the Government of Nunavut’s June decision to grant the power corporation a 6.6 per cent rate hike over two years, instead of a requested 7.6 per cent hike.

“There is no impact because we are at the beginning of the cycle,” the QEC’s president and CEO, Bruno Pereira, told Nunavut MLAs on Sept. 27, during a standing committee review of the QEC 2016-17 annual report.

“I guess the impact is: we don’t have as much revenue to be able to throw at our capital plan and we need to borrow that in incremental amounts,” he said.

Jeannie Ehaloak, the minister responsible for the QEC, announced on June 1 that the Government of Nunavut would not be moving towards uniform power rates in Nunavut.

But the GN did allow the corporation to increase utility rates across the board. Half of that rate hike is already in effect, and the second half will come into force next April.

Those rate increases are needed, Pereira said, so that the corporation can keep up with operating costs and managing its aging infrastructure. Of Nunavut’s 25 power plants, 11 have passed their expected lifespan. Two plants are currently being built, in Grise Fiord and Cape Dorset.

Arviat North-Whale Cove MLA John Main, who is also the chair of the standing committee of regular members, had questions about inconsistent rates in Nunavut communities.

In his constituency of Whale Cove, an unsubsidized residential rate costs 87 cents per kilowatt hour. For the government, the same rate costs 143 cents per kilowatt hour.

“Why is it that in some communities these rates are the same whether you are government or non-government and in some communities they are different—dramatically different in the case of Whale Cove?” he asked.

Pereira said the discrepancies were inherited from the Northwest Territories government.

“As we’ve moved into subsidies from the government directly for the residential rates, that is something that needs to be looked at and reconciled with how the rates are paid today,” he said.

As for the rate discrepancies, “we haven’t had the opportunity to change that yet,” Pereira said. “Because the rates are all different, you would end up with different increases in each community.”

Spare parts, snail mail and dirty soil

On Sept 28, MLAs continued their line of questioning with Pereira, moving on to inventory expenditures, billing methods and remediation of closed-down plants.

Iqaluit-Manirajak MLA Adam Lightstone pointed out a $12-million line item in the QEC report, designated for spare parts and system lubricants. Lightstone asked if this amount would change, following the QEC’s recent inventory of spare parts in its community power plants.

“We know what’s there,” Pereira said of the spare parts. Staff are still deciding which parts are old and unusable, but he expects that amount of $12 million to be reduced in future reports.

Hudson Bay MLA Allan Rumbolt said slow mail in the territory was a problem for residents who, without access to regular internet, are still reliant on paper billing.

“A lot of times these bills are past their due dates when they get to their communities,” he said.

There’s about a 20-day window for a bill to be mailed by the QEC before late fees kick in, Pereira said. Bills are mailed from Iqaluit and Baker Lake.

“That is a problematic area,” Pereira said.

Gjoa Haven MLA Tony Akoak shared the story of an elder who received a disconnection notice when the man hadn’t even been getting his bill.

During this conversation John Main asked if the QEC’s third-party collection service is able to do its work in Inuktut. Pereira said the Edmonton collection company could not work in Inuit languages.

Shortly after, Uqqummiut MLA Pauloosie Keyootak complained that an Inuktut-language document the QEC circulated to MLAs was “gibberish” and hard to follow, because it was without punctuation.

“I prefer reading in Inuktitut,” he said.

When MLAs spoke about remediation of older or decommissioned power plants, Main shared his concerns about a contaminated area in Whale Cove where he said, citing reports, the soil at the site was highly saturated with spilled fuel.

“There are residential homes in that area, there’s a hotel and a community freezer,” he said, adding that flooding in the area could worsen the effect. “They were doing some work at the road and you could smell the diesel fuel.”

The QEC’s latest annual report states there are 25 sites in Nunavut where “the concentration of petroleum hydrocarbons and other pollutants in the soil exceeds environmental standards.”

Remediation costs for those sites amount to about $38 million, and the QEC is not legally required to do that remediation, unless contaminants put public health at risk, making the site an environmental liability, the report says.

Main wanted to know: at what point does contamination become a public safety risk?

“It’s frustrating for Nunavummiut. Not only have we inherited an infrastructure deficit, we have also inherited contaminated sites,” Main said.

Pereira said that the QEC will work with hamlets or communities where health concerns are raised.