Business community drills energy minister on NPC rate increase
Call for a more transparent process of management
The Iqaluit Chamber of Commerce held an emergency meeting last Friday to discuss the impending Nunavut Power Corp. fuel rider rate increase with members of the business community and Ed Picco, the minister responsible for energy.
Picco put to rest suggestions of a 10-cent fuel increase, which the NPC had asked the Utility Rate Review Council to consider.
But it wasn’t all good news. Picco confirmed that the URRC came back with a recommendation for a 7.5-cent fuel rider to offset rising fuel prices.
Picco is currently reviewing the URRC’s report and will come forward with his own recommendation, likely after the report is tabled in the legislature next week in Baker Lake.
Steve Cook, president of the Chamber of Commerce, denounced the implementation of any fuel rider, criticizing NPC for past errors in managing its funds.
A 3.46-cent fuel rider was removed back in March 2002 when the corporation’s stabilization fund was still in arrears.
Normally, when the stabilization fund drops to a negative $2 million balance, an automatic trigger in the form of a fuel rider kicks in. The rider is suppose to stay in effect until the stabilization fund reaches a positive balance of $2 million.
However, it appears that the rider was removed at a time when the fund was carrying a negative balance of $2.7 million, and NPC was carrying a deficit of $4.8 million.
Cook questioned the legitimacy and the acumen of such a decision, calling it irresponsible and shortsighted.
“A prudent business would look ahead and apply for another rider,” he said.
Cook also attempted to deflate Picco’s earlier statements that the rider wouldn’t affect most residential customers because of a Government of Nunavut power subsidy that pays for the first 700 kilowatts of power.
With flip chart and marker, Cook dissected a version of the average monthly household power bill and concluded that with a 7.5-cent fuel rider residents can expect a 50 per cent increase in their bill.
Picco maintained that 80 per cent of the extra funds will come from NPC’s largest customer, the GN.
In conclusion, Cook emphasized the need for a more “transparent” process of managing the public power corporation.
The meeting then abruptly ended when the power went out.