Plugged In Email Newsletter: May 2005

Standing up for public power in the BC election

The biggest issue in BC today is the transfer of public assets to private interests

The BC Liberals launched their provincial election campaign with so many bells and whistles that you can hardly hear yourself think. Will they be successful in baffling us with their bluster? Will the reality of the past four years be drummed out of our minds and our memories? Can we forget the closed schools, hospitals, care facilities and court houses? Can we forgive and forget the sell off of BC Rail, and the break up and privatization of BC Hydro? Will we let this government with its corporate ideology and agenda have at us for another term?

The scariest question of all is: What will they do for an encore? We know from the BC Liberal's original Interim Energy Plan that they want to deregulate electricity prices and move to North American market pricing – a move that would be disastrous, given that electricity rates on the west coast of the United States are double what they are in BC.

With your help BC Citizens for Public Power will stand up in this election campaign for cheaper, greener and more reliable public power. BCCPP is a non partisan, grassroots organization working hard to ensure that a class action law suit to save BC Hydro from being privatized, deregulated and broken up goes b ef ore the courts soon. BCCPP is also thinking positively about the future and looking positively at the provincial campaign. We are confident that our supporters can make public power a major issue in the election campaign and that our supporters will hold candidates accountable by making it clear to them that citizens want an energy policy that ensures the publics best interests are a priority.

BC Citizens for Public Power has a positive, practical, responsible and doable vision for our energy future. Our vision is outlined in five policy initiatives that if undertaken would ensure low rates, clean, reliable electricity generation and service, as well as ensuring that the public's investment in BC Hydro would continue to bring ben ef its to residents and continue to provide a competitive advantage to industry.

The spirit of our policy is consistent with values expressed by local governments, environmental groups and the 70,000 people who signed letters in support of our class action law suit.

The BCCPP policy outlines an energy future that works for us all. We encourage our supporters to ask their candidates to go on record and endorse this policy.
BCCPP Energy Policy 2005

Policy 1. Return and maintain public ownership and control of electricity generation.

* Reaffirm a commitment to public power and BC Hydro.
* Lift the ban on BC Hydro and allow it to build new generating facilities.
* Make a full and independent investigation into the Accenture deal.

Policy 2. Ensure security and reliability of electricity.

* Maintain control of our transmission system and not surrender control of any part of our system to foreign-controlled organizations.
* Prohibit the private export of electricity.

3. Promote conservation and green energy.

* Increase Power Smart conservation targets. Increase energy conservation investments in schools, hospitals and provincial taxpayer supported infrastructure.
* Create a “Green Energy Division” within BC Hydro to promote and build small hydro, wind, tidal, and other forms of renewable energy.
* Continue to promote use of renewable sources of electricity.

4. Maintain low rates.

* Maintain public ownership and control of our electricity so that prices continue to be based on the cost of production and not on what the market will bear.

5. Guarantee improved public oversight and public accountability.

* Increase public oversight of private energy companies. There should be no private energy development unless it is proven more ef ficient than public power.
* Enact standards for public consultation and consent b ef ore any significant changes are made to BC Hydro.

POWEREX LEGAL BATTLE HEATS UP

BC Hydro's marketing arm accused of reaping illegal profits.

During the worst of California 's energy crisis, Powerex Corp., BC Hydro's marketing arm, was reaping windfall profits by sending 500 megawatts per hour of energy to California at a time when prices on the spot market were multiplying 130 times over. BC Hydro's management boldly declared on CBC's “Venture” program that the utility would “make a tremendous profit by selling into that market.”

California has since filed two law suits against Powerex Corp. The first was filed last December and the second was filed in Sacramento County Superior Court on February 10, 2005 . The attorney general of California wants a jury trial in a region where temperatures rise to 110-fairenheit in the summer, making government court buildings even hotter when the air conditioning goes off.

The California State Department of Water Resources claims it was gouged by Powerex during crisis conditions in the state in 2001, which led to overpaying for power. The agency has since been r ef unded nearly $3.4 billion from some 60 North American electricity providers and wants another $9 billion paid back, including $850 million from Powerex.

In October 2003, Powerex agreed to pay $1.3 million in a settlement to the US Federal Energy Regulatory Commission (FERC). The issue was seemingly ended until California state attorney general, Bill Lockyer -- now acting under a Republican governor with a lot of political muscle – filed the two suits. He wants to void $1 billion in contracts that were previously signed under duress and demands that Powerex return $850 million (US) to the state.

Powerex executives in Vancouver argue that California owes it more than $280 million for the power that was delivered in 2000-2001. Powerex adds that it was exonerated by FERC of any wrongdoing in charges of illegal power-trading.

With both sides digging in for a protracted legal battle, there are questions: Will the Powerex legal problems complicate BC Hydro's plans to privatize the utility? Will the legal actions compromise BC Hydro's ability to sell power to some of its largest customers? Who pays if California wins its suits? Are Powerex profits paying the legal fees? Or are rate payers? What if BC Hydro loses and has to sell off assets to pay back the money it owes?

As the days and weeks pass, it will get warmer in California and so will the court buildings.

Michael Shandrick is a former business journalist, and has been a private business consultant in the Lower Mainland since 1991.

PREVIOUS INVESTIGATIONS OF POWEREX DROPPED

In a case of déjà vu all over again, new allegations have surfaced that Enron and Powerex were secretly testing power-trading schemes that led to price manipulation of Alberta 's power pool in 1999.

The Federal Competition Bureau in Ottawa previously dropped its 1999-2000 investigation of Powerex when it could not find any evidence of collusion with Enron. It was alleged that Enron made $45 million (CDN) in a single day by creating fake power shortages on Alberta 's newly deregulated power grid.

Alberta 's Market Surveillance Administrator said on February 11, 2005 it will not pursue these new allegations from a Washington state utility. – M.S.

CLASS ACTION UPDATE

We are moving ahead. Stay tuned.

The BC Citizens for Public Power class action petition has over 70,000 supporters across British Columbia . These people have signed letters of support for the legal action. We know that letters carry significant political weight but we will only know their legal weight when a certification hearing is held.

The certification hearing determines whether or not the class action can proceed to a full trial in the Supreme Court of BC, If we are successful in the certification hearing, then we'll move on to a full trial in what would be the largest class action lawsuit in Canadian history.

We are planning a major announcement about moving ahead with the class action certification hearing very shortly – stay tuned for some exciting news. Until that time, we ask British Columbians to renew their support for public power. Go to our website, sign on the class action suit, get more information and make a donation.

It takes a lot of money to take a class action suit to court. BC Citizens for Public Power thanks you for your past support and hopes that you will continue to support this essential initiative in the future.

The law suit is aimed at overturning the privatization of one third of BC Hydro.

In the suit, we allege that:

* The government has breached its fiduciary duty to the people of BC
* The Accenture deal constitutes a breach of contract;
* The Accenture deal breaches the hydro and power authority act and that;
* It leads to unjust enrichment of BC Hydro and the government.

It is sad that citizens have to go to court to get the government to listen to the overwhelming majority of British Columbians who disagree with their plan to privatize and break up BC Hydro and our electricity system.

Polls on this issue shows that somewhere between 70% and 85% of British Columbians are opposed to privatizing BC Hydro – and yet the government continues with its incremental approach destroying one of the world's most highly regarded utilities and the low cost, relatively clean electricity system it has long provided to all of us.

Tell two people to tell two people!

Make public power an election issue. Share your commitment to public power with two people and then ask them to pass it on to two people. Together we can make public power a major force and a major issue in the campaign.