Crown corporation recommends competing subsidiaries merge again

CBC News: Tuesday, June 1, 2010 | 12:56 PM AT

NB Power is proposing to the New Brunswick government that it bundle some of its competing subsidiaries back into a larger utility, ending seven-year-old plan to make the utility run more like a business. 

Gaetan Thomas, the president and chief executive officer of NB Power, and Edward Barrett, chairman of the utility's board of directors, outlined the proposed changes on Tuesday at a news conference. 

The Liberal government asked NB Power's executive and board of directors to report back on possible reforms after the deal to sell parts of NB Power to Hydro-Quebec fell apart. 

NB Power is recommending that its subsidiaries NB Power Generation Co., NB Power Transmission Co., NB Power Nuclear Co. and NB Power Distribution and Customer Service Co. be turned into generation and customer service business units.

The proposed moves would undo the massive reforms launched by the former Progressive Conservative government in 2003 that broke up the Crown corporation into competing subsidiaries in an effort to have the power utility operate in a more business-like fashion.

"This proposed structure for NB Power would increase efficiencies, reduce costs, eliminate duplication and promote greater transparency which would help us to enhance our relationships with our customers and stakeholders," Thomas said in news release.

Also under the NB Power proposal, all rate increases would be subject to a review by the Energy and Utilities Board.

Currently, NB Power is only required to appear before the regulatory board for rate hikes of more than three per cent, however, the Liberal government has requested the EUB to review smaller rate requests.

The utility's also recommended that Efficiency New Brunswick and the New Brunswick System Operator would retain their current roles and not be folded into the utility.