SaskPower needs more scrutiny now
The unfortunately shortened life expectancy of a lone Odocoileus virginianus robbed many of one more opportunity to vent their spleen at SaskPower Minister Bill Boyd last week.
Somewhere in the wee hours of Thursday morning on his way into Regina for the release of SaskPower’s 2015 annual report, Boyd’s journey was cut short when he hit a whitetailed deer. Given Boyd’s past penchant to run up executive air costs — the NDP charged Boyd took 279 flights to his Eston home, costing taxpayers $400,000 last term — there were jokes aplenty that this white-tailed deer must have sprouted wings.
But pictures of a dented hood on a government-issued vehicle suggested Boyd did hit one of North America’s most widely distributed ungulates, indicating the rarely seen SaskPower minister was absent with cause. He was able to participate in the news conference by telephone.
And by SaskPower standards, the news was generally good.
Aided by rate hikes that dug deep into consumers’ pockets, SaskPower made a healthy $104-million profit on $2.3 billion in revenue in 2015 — a sizable increase from 2014’s $43-million profit. (It should be noted that Crown corporations converted to a fiscal year, so SaskPower’s actually reported profit was $124 million for the 15-month period ending March 31.)
There again, how could it have been anything else? SaskPower increased its rates by five per cent in 2015 — three per cent on Jan. 1, and two per cent on Sept. 1. Since then, it further increased its rate five per cent on July 1, 2016, and plans another five-per-cent hike on Jan. 1, 2017.
By any definition, this is a true monopoly Crown corporation. Unlike SaskTel, which is hampered by competition in every aspect of its operations, virtually every business choice at SaskPower is unfettered.
We simply have come to expect that things like SaskPower’s $1.6-billion investment in carbon capture and storage gets only so much scrutiny when it comes to either its economic performance or efficiency.
This is a problem for Saskatchewan taxpayers when the critical electrical monopoly is being overseen by a minister like Boyd, who hasn’t exactly demonstrated an eagerness for accountability. Less legitimate excuses than running into a deer have seemed to prevent Boyd from appearing before the cameras in all but one occasion in recent months.
But in fairness to Boyd and the Sask. Party government as a whole, problems at SaskPower go well beyond ministerial accountability.
There is a legitimate argument the electrical utility is the most difficult Crown to run in this province because of its critical nature and our lack of natural amenities like hydro power that would greatly reduce electrical generation costs.
As long as the answers to our electrical needs are dirty coal (plus the high price tag of making it environmental friendly) or more costly environmentally friendly solutions like wind or solar, we can likely expect this never-ending stream of rate increases. (This is notwithstanding SaskPower president Mike Marsh’s insistence the company’s rates are “competitive with other jurisdictions.”
And notwithstanding the economic downturn in oil and potash, we still have a growing province with growing electrical needs.
Finally, as convenient as it may be to blame Bill Boyd and the current SaskPower management (which still needs to be held to account for the smart meter fiasco), there was a mess long before Boyd came into view and there will likely be a mess at SaskPower long after he leaves
Decisions made three decade ago by the thenProgressive Conservative government to invest in the Shand power plant and Rafferty-Alameda dams — decisions made with little foresight that were more about placating political interests in the province’s southeast corner — have only led to where we are today.
But that isn’t the only case of government meddling in SaskPower decision-making.
Rightly, the Sask. Party government noted Thursday that the $120 million dividend it took from SaskPower (the only dividend payment since 2009) is minuscule compared with the way the previous NDP and PC governments bled the electrical utility. This is SaskPower’s history, but maybe it means we should see more government accountability — not less.