Yukoners fed up with frequent power outages should blame previous NDP and Liberal governments, says Energy Minister Brad Cathers.
“They took money that should have been spent on maintaining and upgrading the system, and spent it instead on subsidization and pet projects,” Cathers told the legislature on Monday.
“They chose the quick and popular route of short-term gain through subsidization, rather than the responsible route of investing, maintaining and upgrading the system,” he said.
Cathers made the remarks in response to questions by Gary McRobb, the Liberal energy critic, who says the expected elimination of the rate stabilization fund this July will cause consumer power bills to jump.
The fund was established in 1998, when McRobb was energy minister, to cushion consumers from rate shock after the Faro mine, which once consumed 40 per cent of the territory’s electricity, closed.
The Yukon Party government cut the fund by half in 2007 and is expected to eliminate it completely this summer. However, no final decision has been made, said Cathers.
The pot of money would be better called “the rate subsidization fund,” he said.
“It did not stabilize rates, as the member indicated,” said Cathers. “What it encouraged was ever-escalating cost to the taxpayer.”
About $3.5 million is spent on the fund annually. Its size fluctuates, but it has trended upward from $2.3 million in 1999 to $3.2 in 2007. It peaked at $4.8 million in 2006.
McRobb sees things differently.
For him, a critical mistake occurred when the territory stopped paying into the fund in 2004 and expected the parent company of Yukon Energy, the Yukon Development Corp., to pay into the fund instead.
Ever since, claims McRobb, the utility has been forced to skimp on maintaining its equipment in order to pay the subsidy.
The fund’s demise and the past year’s frequent blackouts are “directly related,” he said.
Last week, McRobb told the legislature he expects power bills to climb by 30 per cent, resulting in the average consumer paying an additional $450 annually.
That’s a far bigger jump than is predicted by Yukon Energy spokesperson Janet Patterson, who expects to see only a modest increase of about two per cent this year.
McRobb later explained his numbers differ because he uses 2007 as a baseline, while Patterson starts at 2008.
He also revised his prediction down to an increase of 20 per cent.
But still McRobb appears to be excluding a rate decrease proposed by Yukon Energy, which would bring down power bills significantly for consumers who use less than 1,000 kilowatt-hours of electricity in a month.
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