Monday, June 27, 2011

Bill 36 - It hangs around like a bad smell!

Comments by Joe Anglin

In response to the Calgary Herald’s article, “Alberta transmission plan gold standard for Canada Infrastructure investment key to economic success” by Dina O’Meara, on June 27, 2011.

Pierre Guimond, the head of the Canadian Electricity Association, called the Alberta government’s plans to build a non-constrained electricity system, “essential to the province’s future needs.” Mr. Guimond’s description would be more accurate if he referred to Alberta’s plan to build a non-constrained electricity system as a massive pork-barrel scheme that enriched only a handful of industry players – at the expense of every ratepayer of Alberta.

Only an incompetent government would endeavour to build a non-constrained electricity system. Reference: to view some of the cabinet ministers who made this decision. Any private business attempting such folly would soon be bankrupt. No other jurisdiction in the world is attempting to build a non-constrained system, and for very good reasons.

In planning for electricity systems there is a breakeven point for removing constraints. The cost of operating the system with constraints is always balanced, or measured, against the economic costs of removing the constraints. When the cost of removing a constraint is greater than the cost of operating the system with that constraint, no additional upgrades are required. Removing constraints beyond this breakeven point only increases the total costs to the ratepayer, and it makes the system less efficient!

In summary, building a non-constrained system requires 10’s of billions of additional dollars to build unnecessary infrastructure that has no redeemable value for the rate paying consumers.

The Alberta government’s plan to build a non-constrained electricity system is detrimental to the province’s future needs. It will add unnecessary costs and increase electricity bills. In reality, it will jeopardise Alberta’s competitiveness, and will result in job losses.

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