ATCO talking to Yukon government and Yukon Energy to change utility setup

Alberta-based ATCO is in talks with the Yukon government to overhaul the territory's energy policy, said the head of the ATCO-subsidiary Yukon Electrical Company Limited.

Alberta-based ATCO is in talks with the Yukon government to overhaul the territory’s energy policy, said the head of the ATCO-subsidiary Yukon Electrical Company Limited.

The discussions are wide-ranging and deal with decade-long utility problems, said general manager Jerome Babyn.

Babyn didn’t refute claims ATCO is seeking to buy Yukon Energy assets and manage the Crown corporation.

“I think it makes a whole lot of sense to work together,” said Babyn, when asked if a deal to switch generation and transmission assets was in the works. “I think we can gain some efficiencies. I think we can manage the way we provide service more efficiently.”

Willard Phelps resigned as chair of the Yukon Energy/Yukon Development corporations last week, citing backroom deals between the premier’s office and ATCO behind the backs of the Yukon Energy’s board of directors.

Babyn didn’t deny Phelps’ claims.

“It’s been sort of an ongoing thing,” he said. “You have ongoing discussion at every level. That’s all I can really say.

“We’re going to continue to have discussions with Yukon Energy and the Yukon government and we want the best model for providing service. That’s about all I can say.”

Babyn was ambiguous about whether ATCO was seeking a management foothold in Yukon Energy.

“We haven’t had that type of discussion. Well, I’m not sure. Again, we’ve got to talk about what’s right for the Yukon in terms of power delivery.”

“There’s a number of things being looked at from a policy point of view.”

ATCO is being courted by the Department of Energy, Mines and Resources to bring net metering and independent power producers into the Yukon’s energy mix, said Babyn.

Net metering would allow small-scale energy sources, like solar panels, provide energy for a single home. But if the need is satisfied, a homeowner could gain energy credits by selling energy back into the grid.

Independent power producers are larger-scale sources of generation, like a wind farm, said Babyn.

“That could change how generation is done in the Yukon,” he said.

Independent power producers usually aren’t utilities, he said. But that doesn’t stop a utility from putting in a bid to build a power source, if asked.

“When you need generation, you call on the marketplace to deliver that to you,” said Babyn. “And a utility in some cases can put in a bid.”

That’s been the case in Alberta, he said, where independent power production is common. But it might not be the answer for the Yukon’s future demand for energy, he said.

ATCO is a multinational corporation with subsidiaries around the world worth $9.8 billion, according to its website.

At an annual general meeting in May, ATCO chief executive officer Nancy Southern announced a proposal to create a green corridor in Alberta, whereby northern hydro power sources would replace coal-burning plants in the province.

The restructuring would allow ATCO to comply with new carbon emission regulations brought in by the federal government.

Two weeks later, the government of the Northwest Territories agreed to take a look at an unsolicited bid from ATCO to merge the territory’s public utility with ATCO’s assets in the territory.

Babyn denied Yukon is a component of the green corridor plan.

“It would make more sense to interconnect with BC,” he said. “(Yukon Electrical Company Limited) hasn’t looked at that.”

There is still no word from government on who will own and manage the Mayo B grid expansion. The $160-million project will add a new powerhouse to the Mayo dam and the new transmission line between Stewart Crossing and Pelly Crossing, linking the Yukon’s north and south grids.

Ottawa pitched in $71 million last month. But the scramble to come up with the additional $90 million is raising questions about the hastily assembled deal.

First Nations are being wooed as investors, Yukon Energy president David Morrison said after the federal grant money was announced. But apparently that forced a mass resignation from the Crown-owned corporations’ board.

The Yukon government interfered in Yukon Energy’s affairs by trying to strike a deal with First Nations on its own, said Phelps. Board directors Greg Hakonson, Paul Hunter and Martin Allen resigned alongside Phelps on June 8.

Fentie has no mandate to privatize Yukon Energy or pursue his own deal with First Nations, said Liberal Leader Arthur Mitchell during a news conference Tuesday.

Calling Phelps’ revelations “extraordinary,” Mitchell called on Fentie to cease and desist his privatization plans until the electorate could decide the issue.

“The Yukon Party has never campaigned on privatization,” said Mitchell, adding that Yukon Energy is the single largest asset owned by the Yukon public.

Fentie is running a secret agenda by refusing to have met with the now half-empty Yukon Energy board, said Liberal energy critic Gary McRobb.

The Yukon Party’s energy policy has been sitting on the minister’s desk since 2004, but the government hasn’t revealed it, he said.

Fentie is fielding questions on the issue instead of the minister responsible for Yukon Energy, Jim Kenyon.

This is just the latest example of Fentie’s micromanaging political style, said Mitchell.

He’s turning arm’s-length boards into puppets, he said.

But he won’t speak for the remaining three Yukon Energy board members, who are all appointed by the Council of Yukon First Nations.

The board members can’t resign without approval from the council, he said.

The Liberals aren’t against First Nation investment in Mayo B, but believe Yukon Energy should be making that decision, not Fentie.

The three northern First Nations are interested in a project like Mayo B, said Vuntut Gwitchin First Nation Chief Joe Linklater.

Under the North Yukon Economic Partnership Agreement, signed in 2004, the Vuntut Gwitchin, Tr’ondek Hwech’in and Na-cho Nyak Dun First Nations have agreed to approach economic projects collectively.

“Mayo B is in (aboriginal territory), so it’s something we would look at,” said Linklater. “We would support any kind of economic opportunity. But the development corporations have to look at it to see if it’s profitable or not.”

The First Nations have discussed the project, but not in detail, he said.

Because Mayo B is in Na-cho Nyak Dun territory, it’s up to it to spearhead the discussions with the Yukon government under the 2004 agreement, said Linklater.

Fentie has not returned repeated calls on Yukon Energy for the last 10 days.

Contact James Munson at

jamesm@yukon-news.com.

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