Wednesday, August 30, 2006

On Tofino's water crisis and the opportunity for Elizabeth May

VICTORIA - Newly Green party leader Elizabeth May is already ahead of the game.
May captured the leadership this week in Ottawa, sweeping aside two other candidates.
People - or at least the media - actually paid attention. That’s a big change for the federal Greens.
May looks a smart choice on the basis of her skills and experience. She’s 52, with a law degree and a long history in the environmental movement. As executive director of the Sierra Club, she’s shown the ability to come up with ways of pitching an environmental message that win media attention and resonate with voters. She’s had some experience inside the world of government, working as an advisor to then environment minister Tom McMilan during the Mulroney years.
The Greens are still a desperate long shot to have any electoral success under Canada’s current winner-take-all system.
But that doesn’t mean the party can’t be influential, if it focuses on the right issues in a compelling way. The Harper Conservatives are weak on the environment, especially on the major problem of global warming. They’ve effectively pulled Canada out of the Kyoto accord, with no indication yet what alternate plan they have.
Stephen Harper doesn’t have much to fear from the Liberals on the issue. All he has to do is point to their record in power, which featured much talk and no action.
May is a more serious threat. It doesn’t matter if see convinces voters to back her party. Effective attacks on the Conservatives’ position will still undermine Harper’s chances.
It’s a good issue. Poll show Canadians are convinced global warming is a threat and that it’s important to reduce greenhouse gas emissions. Leaving aside the warming issue, spiking oil and gas prices have convinced many Canadians it’s wreckless to be so dependent on fossil fuels.
If May needs a talking point for speeches in B.C., she needs to look no farther than the water crisis in Tofino that’s shut down tourist businesses on one of the busiest weekends of the year.
The story has it all for the Greens. The threat of climate change, shown by the virtually non-existent rainfall this summer. The importance of conservation. The consequences of poor planning and lack of concern for environmental issues.
And on top of that, an good case study in the economic costs of neglect. The community will lose something like $350,000 a day in economic activity when the indefinite ban starts. That would have paid for a lot of conservation programs or an improved water supply system.
Instead of focusing on that kind of issue, May’s first public comments after winning the leadership were about the need to repeal NAFTA, pointing to the softwood lumber dispute and perceived threats to Canada’s right to have independent environmental policies.
It was an odd choice. NAFTA really isn’t on most Canadians’ list of pressing issues, in part because the agreement has mostly been beneficial in ensuring access to U.S. markets. Thirteen years after the deal was signed, the dire warnings about the Americans taking our water or gutting environmental regulations just haven’t happened. The sky has not fallen.
May has a good opportunity. The party has more than $1 million a year in public funding, based on its showing in the last election. May has good skills and wisely plans to watch the Commons from the visitors’ gallery and offer her critiques daily to the media. It’s tactic that worked reasonably well for NDP leader Jack Layton until he won a seat.
Most importantly, May takes the helm at a time when there’s a political vacuum. The Liberals are discredited; the Conservatives make many voters nervous; and the NDP is seen as irrelevant.
Even if the Greens are unlikely to win any seats, all the other parties will be edgy about losing critical votes in close ridings and shifting their policies accordingly.
It’s a fine time for a new leader and new party to make a mark.
Footnote: Despite their traditional decent showing in B.C., the Greens’ best chance for a breakthrough may be Quebec. Polls show Quebecers are the strongest on environmental issues, especially in support for Kyoto. And they have no trouble with the idea of casting a protest vote; after all, they sent 51 Bloc Quebecois MPs to Ottawa out of 75 seats. Unfortunately, May’s French is poor to mediocre.

Monday, August 28, 2006

Alcan's sweet power deal still a mystery

VICTORIA - The people in Kitimat complaining that the province is handing a giant gift to Alcan have been taking some hits lately.
Since the corporation announced plans to modernize its smelter, the critics have been painted as a bunch of out-of-touch, whiny ingrates.
Alcan’s announcement is great news, says Premier Gordon Campbell. It shows that B.C. is a good place to invest.
The smelter in Kitimat employs about 1,550 people and is the heart of the company town. Alcan has announced plans to spend about $2 billion to modernize the smelter. Production capacity will increase by more than 40 per cent, but new technology means the smelter will employ about 550 fewer people. There will be several hundred construction jobs as the work is done. And the investment likely guarantees that the smelter will be around for a few decades.
A lot of that is good news, especially the certainty. Alcan has operations around the world and there’s always the risk some other government will offer dirt-cheap power and the company will move on.
The job losses aren’t good news. Kitimat has seen a steady reduction in jobs at the smelter, with a damaging effect on residential property values and small businesses. The announcement that more than one-third of the jobs at the smelter will vanish is a major blow.
Usually you would still say tough luck. Technology has meant job losses in other industries. Companies adapt to global competitors or vanish. It’s painful, and sometimes government help is needed during the transition, but change is inevitable.
But there’s a difference here.
Kitimat exists because of a deal between Alcan and the provincial government reached in the later 1940s. The government wanted economic activity in the northwest. Alcan wanted cheap power and ocean access for an aluminum smelter. (Making aluminum requires lots of electric power to generate heat.)
B.C. had an extraordinary resource to offer. Back in 1928 a provincial bureaucrat named Frederick Knewstubb had looked up from a pile of maps in Victoria and announced that he had discovered one of the world's great hydroelectric sites.
He proposed damming the Nechako River, reversing its flow and sending the water rocketing down to the coast, driving turbines at the bottom. But the power wasn’t needed in the northwest and there was no way to get it out to other markets. Nothing happened.
Until 1949, when the province handed over the water rights and Alcan agreed to build the power project, smelter and planned community. It was a trade - cheap electricity for jobs.
But the government was prudent. Even though there was no transmission grid for Alcan to tap into then, then the agreement anticipated the risk that Alcan would just sell the cheap electricity at a profit instead of creating jobs. The act and agreements handing over the water rights said the power was to be used to make aluminum or for other industrial projects "in the vicinity of the works."
The people in Kitimat - including Mayor Richard Wozney, a former Liberal candidate - want the agreement enforced. If it was, they say, Alcan would have expanded the smelter to make use of the electricity at the same time as it modernized, preserving jobs.
Or the province could reclaim the power and make it available to other industries willing to develop in the area.
Instead, Alcan will keep on selling electricity from Kemano that was supposed to be used to generate economic activity in the region, first to BCHydro, then direct to the U.S. Profits are huge, because the energy is so cheap to produce. Conservatively, figure about $1 billion over the next 20 years - half the smelter project costs.
It’s been a long a battle for Kitimat, with few successes. The provincial government hasn’t given any real answers about why the original agreement is no longer valid, or when the public resource became Alcan’s property. Some straight answers would go a long way.
Footnote: Kitimat is continuing legal efforts to enforce the original agreement, but the chances of winning any real change look slim. Politically, the issue is costly for the Liberals. Former MLA Roger Harris, widely respected, lost to New Democrat Robin Austin by 440 votes in 2005. The government’s stonewalling on Alcan power sales was a big factor.