Plugged In Email Newsletter: August 2004

Class action lawsuit certification delayed

As you may know, BC Citizens for Public Power had been aiming to have a certification hearing for the class action lawsuit in late October.

Unfortunately, we are being forced to request a delay (what lawyers call an adjournment) of our class action certification motion in BC Supreme Court.

The reason is straightforward: at this point we simply do not have enough funding to take this critical case through the certification process. But it is vital for you to know that we have not and will not give up the fight to have our day in court - to challenge the outrageous break-up and privatization of one-third of BC Hydro.

A delay of our certification motion is a setback, to be sure, but we have every intention of raising the money necessary to fully fund our court challenge and get back into BC Supreme Court.

The success of BC Citizens for Public Power to date has been astonishing, thanks to our supporters. But we are facing powerful forces like the BC provincial government and BC Hydro and the case has become more expensive than we ever imagined.

That's why we have to ask you to help out - with a big push to raise the money we need to go to court and to win certification for what could be the largest class action lawsuit in Canadian history. (To make a donation now through our secure server, click here )

And I ask you to think about how far we have come together in this fight to save British Columbia 's public power legacy. Two years ago, the BC Liberal government announced it would transfer one-third of BC Hydro's operations and jobs to Bermuda-based multinational Accenture.

It soon became clear that the only course of action l ef t was to seek justice in the courts. The legislation was then rammed through the BC Legislature in just a week, with absolutely no public consultation or input. And even more insulting have been the constant government claims that BC Hydro has not been privatized, even though a foreign company now controls and directs one-third of the crown corporation.

I mention all this because I cannot emphasize enough how important your response to this urgent letter of appeal truly is.

If we cannot raise the funding necessary to complete the certification hearing and attempt to overturn the BC Hydro privatization, the results will be absolutely disastrous. I believe that not only will the privatization of one-third of BC Hydro be permanent but it will also be just the start. We know that thanks to BC Citizens for Public Power 's strong campaign surrounding our class action lawsuit, the BC government has backed down from a much larger scheme to privatize and deregulate BC Hydro.

Remember, the original BC Energy Plan released by the province called for California-style deregulation and market prices for energy - prices that would soon double and triple as BC's low cost hydroelectric power was sold to the highest bidder in an electricity-hungry United States . We continue to enjoy the third-lowest electricity rates in North America - but how long will that last?

Fortunately, generous British Columbians like you responded to our idea to take the government and BC Hydro to court.

Since BC Citizens for Public Power was founded, we have sent out over 500,000 letters across the province. We have gained the commitment of more than 75,000 people who signed on to support the class action lawsuit. And we have the financial backing of nearly 20,000 generous donors like you.

What's more, we have become a strong voice against the privatization of our most important public utility. Just ask the MLAs of the BC Liberal caucus. They have publicly admitted that no other cause, no other issue has created more complaints from their constituents than the privatization of BC Hydro.

One brave MLA even quit the Liberal Party because of the privatization. Prince George-Omineca. MLA Paul Nettleton could not stomach what he saw happening to BC Hydro and in an eloquent letter, l ef t the Liberal caucus to sit as an independent.

Mr. Nettleton was not alone in his opposition to BC Hydro's grim fate. In June 2003, BC Citizens for Public Power held an historic public meeting in Vancouver featuring two former premiers of our province and the leaders of our three major opposition parties - all united in support of BC Hydro. Former Social Credit premier Bill Vander Zalm joined former New Democrat premier Dave Barrett, Unity Party leader Chris Delaney , Green Party leader Adriane Carr and then-NDP leader Joy MacPhail for an evening to remember.

BC Citizens for Public Power also enlisted the support of these prominent British Columbians and many more in a full-page ad in the Vancouver Sun opposing privatization of BC Hydro.

We have also intervened in electricity rate hearings at the BC Utilities Commission, done countless media interviews, organized community forums around the province, released important research, opposed the replacement of public power by private energy companies, supported green power initiatives and worked with like-minded groups from across Canada and the United States.

That is why I believe it is so vital that BC Citizens for Public Power continue with and win certification for our class action lawsuit. And why it is equally vital that BC Citizens for Public Power also continue to inform British Columbians about the impact privatization of BC Hydro has had and will have if it isn't stopped.

Put simply, as enthusiastic as the board of directors of BC Citizens for Public Power were about going to court in October, a careful examination our financial situation today meant that we could not guarantee the legal fees needed for a lengthy legal hearing. To date, our legal costs alone have amounted to over $230,000 despite significant pro bono work. Add to that the cost of reaching hundreds of thousands of British Columbians, creating a new organization and waging the battle to build support for public power in the face of privatization and you can see how challenging it is to take the provincial government and BC Hydro to court.

We estimate that it will take another $100,000 to prepare our legal arguments and have them heard at the certification hearing in BC Supreme Court. It is a significant amount but certainly not beyond our reach - with your help. As soon as we have raised these funds we will immediately apply for our case to be rescheduled and heard as soon as possible.

I know that this financial shortfall is discouraging news. But just as British Columbians came together in the past to build BC Hydro as a public utility serving the whole province, so can we today unite in our determination to protect the legacy of public power.

I urge you to send a donation today, of $25, $50 or $100 - or whatever amount you can afford - and send a strong message that we will continue to fight the privatization of BC Hydro and that we will have our day in court. To make a donation through our secure webpage, click here .

Thank you so much for all your past help and for your understanding and support for BC Citizens for Public Power. Together, we can and will succeed.

Is your privacy another cost of BC Hydro privatization?

It appears that your privacy may be another causality of the privatization of BC Hydro. Certain provisions of the USA PATRIOT Act may in fact provide the FBI with the ability to view personal records that are managed by American linked corporations.

The BC Citizens for Public Power have submitted a bri ef to the privacy commissioner outlining concerns that the privatization of 1/3 of employees and operations to Accenture may allow the FBI to access our personal information under the PATRIOT ACT. To view our submission in PDF format, click here.

BC Hydro executive appointed to coal company board of directors

On May 6 th , BC Hydro executive Dawn Farrell was appointed to serve on the board of directors for BC's largest coal company, Fording, Inc. As the executive vice-president responsible for generation, Farrell's appointment has raised concerns about conflict of interest and whether BC Hydro is truly committed to greenhouse gas reductions.

In an interview with reporter Charlie Smith published in the Georgia Straight, Ms. Farrell denied that there was a conflict of interest, arguing that there was is no strong link between Fording and the energy industry in B.C.

However, Minister of Energy and Mines Richard Neufeld has repeatedly stated that he believes that there is a bright future for coal fired electricity in B.C.

And environmentalists have expressed concern about this clear link between BC Hydro and the coal industry at a time when B.C. should be considering reducing greenhouse gas emissions.

According to the Georgia Straight, BC Hydro paid Farrell $252,818 in salary, bonuses, and ben ef its in the last fiscal year. Fording Inc. directors are paid an annual cash retainer of $20,000, collect another $40,000 through a company investment each year, and receive $1,500 for each board meeting attended.
Privatization gone wrong - Accenture on the hot seat in Ontario

Ontario 's contract with Accenture to implement and manage their welfare system has been riddled with cost over runs and harsh criticism from their provincial auditor. Now, a simple increase in ben ef its for welfare and disability recipients has resulted in delays and more cost overruns and Accenture is getting paid millions to fix the problems created by their own system.

In 1997, premier Mike Harris and the Ontario Conservative government hired Andersen Consulting (now known as Accenture) to update the Ministry of Community and Social Services' computer systems.

The deal seemed plagued by scandal from the start. A thorough review by the Ontario auditor concluded that the deal for the $500 million computer system was seriously flawed. Cost savings came as a result of reducing ben ef its, rather than improved ef ficiencies.

This was supposed to be a tale of private sector ef ficiency outclassing a stodgy public system. Instead it has become a cautionary tale of "privatization gone wrong".

The most recent episode has l ef t hundreds of thousands of welfare and disability recipients in the lurch and taxpayers on the hook. Earlier this year, it was learned the system, responsible for distributing welfare and disability ben ef its to 670,000 Ontarians, is unable to calculate a 3 per cent increase, the first rise in 11 years.

As a result of the system failure, Ontario 's Liberal government was forced to set up an alternate payment system to provide the new payments to recipients of disability and social assistance ben ef its.

According to experts, it will cost between $10 - 20 million to fix the problem. And, unbelievably, Accenture will be paid to do it. In 2002, in spite of the report of the provincial auditor, Accenture won a $34-million maintenance contract for the system.

So while over half a million welfare and disability recipients await a $15 a month increase in their payments, Accenture r ef uses to fix the problem for free and will be paid tens of millions to correct their own system.

The B.C. government and BC Hydro do not appear to have learned anything from this cautionary tale. Like Ontario , what are advertised as cost savings (supposedly $25 million per year) appear to actually be cost increases. So far, BC Hydro has booked no ben ef its from the Accenture deal and has instead included $40 million in restructuring costs as part of their application for a rate increase. The deal has avoided regulatory review and Accenture, the government and BC Hydro continue to remain secretive about the details.

BC Utilities Commission hearings to set new transmission rules

In August, the newly formed BC Transmission Corporation (BCTC) announced an application for a new system of setting transmission fees for private energy companies.

This new tariff will be a key part of the process to establish a deregulated wholesale electricity market and facilitate the privatization of electricity production in B.C. The hearings will be held this fall.

Citizens for Public Power will be intervening in this hearing and making submissions to the Utilities Commission. To keep up with our involvement in the hearings, continue to visit this site (www.citizensforpublicpower.ca).

The BC Utilities Commission is expected to rule on BC Hydro's request for a 8.9% rate increase this fall.