The Politics of Power

Rural Alberta lost its voice when Bill 46 took effect

Feb 9, 2008  

by Andrew Nikiforuk

Illustration by Robert Carter

The recent fight over Bill 46 (The Alberta Utilities Commission Act) makes an unsettling tale about electricity deregulation in Alberta. Although Ed Stelmach’s Tories made a few last-minute changes to the controversial legislation, these amendments haven’t resolved the growing regulatory mess and democracy gap for energy developments in Alberta. And for an energy-driven province, that’s really bad news.

Here’s the high-voltage situation as it unfolded. Energy Minister Mel Knight tabled Bill 46 last year, declaring that it would “promote efficiency” in the province’s energy regulatory system by splitting the province’s key energy regulator, the 12-year-old Energy and Utilities Board (EUB) back into two separate entities. A reborn Energy and Resources Conservation Board will tackle oil and gas applications while the Alberta Utilities Commission will focus on the costly fallout of electricity and natural gas deregulation.

But a number of glaring deficiencies quickly illustrated that this back-to-the-future bill had also had little respect for democratic input. Conservative landowners battling AltaLink’s proposed 500 kilovolt (kV) transmission line between Edmonton and Calgary first identified this omission and turned it into a cause célèbre throughout rural Alberta.

Their leader, Joe Anglin, a Rimbey-area businessman and former cop, discovered that Bill 46 contained clauses that gave the new electrical commission the right to arbitrarily make decisions about transmission lines (or nuclear plants for that matter) with little or no intervention from the public. To Anglin, the bill simply reinforced the existing unsatisfactory process in which landowners routinely fought the violation of due process in kangeroo-like public hearings.

Last September, the EUB, a deeply troubled agency formally sworn to impartiality, admitted “reasonable apprehension of bias” by nullifying the whole hearing process for the 500 kV line and firing a raft of employees. The board’s glaring bias shockingly included hiring security guards to spy on citizens exercising their democratic rights.

The next issue concerned the key architect of the bill, Kellan Fluckiger. Since 2003 Fluckiger, a veteran of California’s power mess, has steered Alberta’s troubled electricity deregulation process. Deregulation promised cheaper power but has only delivered higher prices and unfathomable complexity. Keith Provost, a former senior executive with Alberta Power, argues that electricity deregulation has “needlessly cost Alberta consumers more than $13.8 billion” between 2001 and 2006.

Fluckiger also played a key role in the AltaLink line scandal. As executive director of the provincial energy ministry’s electricity division, Fluckiger not only endorsed the controversial 500 kV line in a regulatory hearing but did so while married to one of its key proponents, Zora Lazic, the vice-president of regulatory affairs for AltaLink. Fluckiger abruptly left the government last October but a conflict-of-interest investigation by the auditor general of Alberta remains ongoing. Nevertheless, his departure should raise a host of questions about the integrity of Bill 46.

Next, the Consumers’ Association of Canada found another Stalin-like whopper in Bill 46. It proposed that the efficient voices of ordinary citizens and ratepayers in public hearings be replaced with a shadowy government bureaucracy, the Utility Consumers Advocate (UCA). Formed in 2003, the UCA has been flooded with billing complaints under electricity deregulation. But Bill 46 formally made this toothless government bureaucracy the sole representative of consumers before a government-appointed board. All in the name of efficiency.

Last but not least, the bill appeared to be another bloodied bandage for Alberta’s ever-hemorrhaging policy vacuum on electricity deregulation. This partly explains why Calgary mayor Dave Bronconnier and the province’s largest commercial power users, the Industrial Power Consumers Association of Alberta, also opposed the badly drafted legislation.

Despite a few hasty amendments to Bill 46, the province still remains in a troubling regulatory pickle. According to Anglin and other opponents of the legislation, the government must now pursue two real solutions. First, it squarely needs to declare deregulation a failure and redesign its regulatory system. Second, it must re-establish the integrity of the province’s energy boards as truly functional regulators. Anglin doesn’t think they will become accountable until they once again actively “balance the rights of citizens with the rights of industry.”

And that’s why Bill 46 charged so much political talk last year and why more will follow.

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