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David Raymond Amos‏ @DavidRayAmos
Replying to @DavidRayAmos @alllibertynews and 49 others



https://davidraymondamos3.blogspot.com/2020/02/nb-power-plan-to-remove-joi-scientific.html



#nbpoli#cdnpoli



https://www.cbc.ca/news/canada/new-brunswick/nb-power-eub-rate-hearing-joi-scientific-1.5462070

NB Power plan to remove Joi Scientific spending from rate increase an empty gesture, says expert

Utility opened EUB hearings with surprise move to lower requested rate increase to 1.9%

A utility expert hired by the EUB said NB Power should stop investing into 'speculative' ventures, like Joi Scientific, during the utility's rate hearing Wednesday. (Radio-Canada)

NB Power's gesture to remove money spent on Joi Scientific from this year's rate increase will not save customers from paying for the investment and the utility should stop putting money into "speculative" ventures, its rate hearing was told Wednesday.

"NB Power ratepayers should only pay for costs that are directly related to the provision of utility service," said Dustin Madsen, a Calgary-based utility expert hired by the Energy and Utilities Board to review NB Power's application.

Madsen produced a 63-page report about the rate increase, but he began his testimony with a pointed criticism of money NB Power spent on a Florida hydrogen-from-seawater venture over the last four years.

"Costs that are speculative in nature are not in my opinion appropriate for NB Power's ratepayers to fund," said Madsen. 

"If a cost does not provide a direct benefit to customers or relates to an asset that is used or required to be used to provide utility service, then ratepayers should not bear that cost."


Utility expert Dustin Madsen listening to testimony at NB Power's rate hearing. Madsen said NB Power should not be permitted to invest in 'speculative' ventures. (Roger Cosman/CBC)

NB Power opened the hearing last week with a surprise announcement that it was lowering its rate increase request from two per cent to 1.9 per cent so customers would not have to pay for ongoing amortization and interest costs related to its investment in Joi Scientific.

"We thought it was important to notify the panel NB Power has recently decided it will not seek to recover the cost incurred for the licensing agreement with Joi Scientific," said Darren Murphy, NB Power chief financial officer and senior vice-president, minutes into the hearing.

"As a result, we are reducing the cost of our application accordingly."


NB Power CFO Darren Murphy announced last week NB Power would not be asking customers to pay for the utility's investment in Joi Scientific. (Roger Cosman/CBC)

But Madsen called that an empty gesture.

He said customers have already paid for the non-capital costs of what has been spent — about $1.92 million — and because the rest is to be paid by NB Power, a lower rate increase for it this year will only have to be made up later for the utility to hit debt and equity targets.

"NB Power's ratepayers have paid for some of those costs and will still ultimately pay for the remaining costs in the future … as while the costs are not included in revenues, they are offset against NB Power's equity, which is legislated to be set at 20 per cent," said Madsen.

"NB Power's ratepayers will not pay directly, but they will pay indirectly through higher net earnings for NB Power in the future. In my opinion, ratepayers should not bear this cost."
Evidence unearthed at the hearing has shown the total cost of the hydrogen project was $16.5 million over four years, more than previously reported.

The amounts include $9.22 million NB Power spent of its own money and another $7.3 million it talked the province into contributing. That total includes $1 million spent this year by NB Power that was not specifically included in the budget approved by the EUB at last year's rate hearing.

Joi Scientific claimed to have developed a method to efficiently generate hydrogen gas from seawater to generate electricity on demand. It would have been a major scientific breakthrough where the energy output of the process was claimed to be greater than the energy input, and in 2016 senior NB Power officials, including President Gaëtan Thomas, became convinced it could work.  


NB Power spent $1 million on pursuing the hydrogen-from-seawater project this year, including money it paid for lab space at the Space Life Sciences Lab in Merritt Island, Fla. (Karissa Donkin/CBC)

Last week, Keith Cronkhite, NB Power senior vice-president for business development, said attempts to duplicate company test results and build a commercially viable device ultimately failed.

"The advances that were anticipated relative to the electronics and the ability to simplify the testing of the rig did not develop as we would have anticipated," he said.

In December, Mike Holland, the minister for natural resources and energy, announced the province, as NB Power's sole shareholder, did not want the utility to pour any more money into Joi Scientific.

"At this particular moment I have not been presented with any proof of viability," said Holland about the technology.
In his larger report, Madsen was also critical of NB Power spending $1.3 million this year on studying the iron-ore processing facility being proposed by the company Maritime Iron in Belledune.

"It would be beneficial to understand if Maritime Iron will compensate NB Power for any of these costs as it would be presumably a mutually beneficial relationship," he wrote.

Hearings conclude Thursday with closing arguments.



  




48 Comments 




David Amos
We get the governments we deserve 











David Amos
My friend Roger Richard speaks for the last time today in this matter

Methinks it should prove interesting what Mr Jones does not report as per his MO N'esy Pas?

























Jacob Minton
How about a class action against the board and executives of NB Power, on behalf of NB rate payers, to recover the money lost through gross negligence?

Spending millions on magic water wasn't the choice of rate payers, it was the fault of well paid and pensioned people who knew that any money lost would be paid by customers poorer than themselves. But they spent it anyway, on a scam that a middle school science student could have told them was snake oil.


David Amos 






















David Stairs
incompetence and no accountability at it's best....this train is headed for a wreck....time to bring in the Police and do an impartial investigation and lay the appropriate charges....


David Amos 
























Derek Grant
JOI just carbon-copied the script from the film "Chain Reaction" and went trolling
for Turnip Truck Discards to invest. Cue the Dueling Banjos, they found their hillybilly
investors just north of the border! Come on!


David Amos 

























Aaron Allison
We need a FORENSIC AUDIT into NB Power the the AG.


David Amos 
























Robert L. Brown
The political proccess in New Brunswick Must think that the Taxpayers of New Brunswick are idiots when the hire a "expert" to tell them what the taxpayers have been telling them for years NB Power needs to be overhauled NOW and not by experts but by the taxpayers get rid of the top overhead first and then there are a lot more to be done like the hiring of political utility companies and hire there own





























Roland Stewart
Instead of closing ER's at Hospital's this is where Higgs need to clean house.


David Amos


























David Peters
"...lowering its rate increase..."

An efficient, streamlined energy sector, involving real competition would be talking about ways to lower rates, not lowering rate increases...but, this is what we get when we turn such a vital sector into a political patronage hub.


David Amos 






























Brian Robertson
If the EUB has any sense of responsibility to New Brunswick ratepayers, they will slam the door on these two faced opportunists and their annual shell game. While we struggle to find which has the pea, they will always have one hand in our pockets.
The only way we will see better management of NB Power is to squeeze it out of them.


David Amos 


























Alex Butt
Do the EUB and the cronies at nb power actually think we beleive that they are doing ANYTHING in our interests? Of course WE will end up paying for this, as they will still get their huge saleries, bonuses etc, and where do they think the money comes from.... Magic joi beans?? It comes from our pockets.


David Amos  
























Tom Gordon
You pay, me pay, we all pay for it one way or another.


David Amos 
























David Amos 
Methinks if folks truly cared they would download documents from the EUB in order to read the facts and the testimonies under oath for themselves instead of relying on the media to give their spin on important matters.

On a personal level the NB Power Notice of Objection to Intervener Request beginning with document number 59994 in the EUB 430 Matter and the related decision is a hoot to read to see why I have every right to sue NB Power and the EUB anytime I wish N’esy Pas?































David Amos 
Go Figure

NEW BRUNSWICK ENERGY and UTILITIES BOARD

Matter 458
IN THE MATTER OF an application by New Brunswick Power Corporation for approval of the schedules of rates for the fiscal year commencing April 1st 2020.

Held at the Delta Hotel, Saint John, N.B. on February 9 12th 2020.

Page 46

MR. HERRON: It makes perfect sense.
A. Okay.
MR. HERRON: So perhaps said it another way. So there is 21 a benefit to a ratepayer if they have a lower rate?
A. Yes.  


David Amos
Reply to @David Amos: MR. HERRON: And you are suggesting there is also -- there could be a benefit to the ratepayer if the company’s net 1 earnings and capital structure is improved as well?
A. Yes. So there --
MR. HERRON: So there is a benefit to the ratepayer with either choice that the Board may make?
A. Exactly.
MR. HERRON: Okay. Those are my questions. Thank you.
VICE-CHAIRMAN: Thank you, Mr. Herron. Just a follow-up on the question that Mr. Herron was asking on the disallowances, Mr. Knecht. If the Board finds that there are costs that are overstated and disallows those costs, and we essentially don’t reduce the rates, how can this Board measure the accountability of the company towards ratepayers?


David Amos
Reply to @David Amos: A. The accountability gets measured the same way, which is you have now changed the bite. At the end of the day, if the company spends the money, you have no real options for those funds not being passed on to ratepayers under the current regulatory regime. Unless you can stop them from spending it, you can’t keep ratepayers for being on the hook for those costs.
So I think my response to your question is if you decided that say the O&M budget is too high, you know, by $20 million or whatever, you lower the budget for that the approved number for the test year, future test year 2021, you increase the net income budget, and then when you review it next year as part of the -- or probably two years out when you review that, you say why didn’t you hit your budget, because that is all you can do. You can only say, you know, I am going to evaluate you based on your performance, and if you keep missing your budgets, you know, that is going to be vetted in a public hearing. But, you know, as a practical matter, as I said, you know, once the company spends it, it is going to flow to ratepayers one way or the other.  


David Amos
Reply to @David Amos: VICE-CHAIRMAN: Any redirect, Ms. Black.
MS. BLACK: Just a couple of questions, Mr. Vice-Chair.
REDIRECT EXAMINATION BY MS. BLACK:
Q. - Mr. Knecht, in your discussion with Ms. Desmond, she started off by asking you questions around why you may have taken a different approach from Mr. Madsen in terms of conducting a detailed review of the revenue requirement, particularly cost components like the ones Mr. Madsen reviewed related to OM&A. Do you recall that?
A. Yes.
Q. - Okay. Is there any other reason beyond the time constraints of the hearing schedule that you may choose in a particular year in the context of doing your work for this kind of proceeding, is there another reason why you wouldn’t focus in the same way Mr. Madsen has on particular components in the revenue requirement?
A. There is a couple of things. One, is I do a fair amount of work within the cost allocation and rate design area, and that is not an area that Mr. Madsen went into? And I think that goes a little bit to the available time to cover all of these topics


























Johnny Jakobs
What's it going to take for change to happen at NB Power? They are lying, cheating and deceiving everyone to cover their crimes. White collar criminals running a crown corporation.




































Terry Tibbs
BRAVO, BRAVO...........NB Power even has guys from Calgary laughing at us now.