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Abitibi awaiting details on energy rebate plan

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FORT FRANCES—Abitibi-Consolidated Inc. says Premier McGuinty’s energy rebate plan for pulp and paper mills announced last week is a good start in reducing the industry’s costs, but more details are needed to determine how much the mills will benefit.

“We think it’s a good step in the right direction, implementing programs that can have an impact on the industry’s costs, to reduce the cost of making paper. That’s always a good thing,” Denis Leclerc, Abitibi’s director of public affairs, said in a phone interview Tuesday from Montreal.

“This doesn’t resolve the global energy situation in Ontario,” he added. “We don’t have the details of the program yet.”

Premier McGuinty was in Thunder Bay on Nov. 20 to announce the Northern Pulp and Paper Electricity Transition program, which will provide 15 percent electricity price rebates over three years for mills that produce a minimum of 50,000 megawatt hours (MWH) annually—and which “commit to increased energy efficiency.”

“One detail that we know is that the eligibility to participate in this program will require an energy plan that has to be approved by the ministry,” Leclerc explained.

The plan must “focus on ways to reduce energy consumption or to improve energy efficiency,” he added.

“We do have plans, but they have to be approved by the ministry [of natural resources],” he noted. “They have to demonstrate these plans will result in energy savings.”

How the ministry will judge these plans has yet to be determined. “Those are the details we don’t have,” Leclerc said.

“We expect that three mills will benefit from this program,” he added, citing the Fort Frances mill, the Fort William mill in Thunder Bay, and the mill in Iroquois Falls.

Leclerc also said it’s not unusual for the government to announce a new program, then work out the details in the coming weeks and months.

“We don’t have all those details, and we are eager to know them to be able to benefit as soon as possible from this program,” he remarked.

As reported in last week’s Times, McGuinty’s announcement provoked a strong response from Ontario NDP leader and local MPP Howard Hampton, who called the plan “much too little and much too late.”

For its part, the Ontario Forest Industries Association said the plan would reduce electricity costs by about $10 per MWH for those mills that qualify, reducing the average from $70 per MWH to about $60.

The OFIA still is calling for a rate of $45 per MWH to make Ontario mills more competitive with neighbouring provinces, which pay between $29 and $42 per MWH.

According to OFIA, 8,800 people in direct forest sector jobs and 36,080 in indirect ones have been laid off in Ontario since 2002, totalling 44,880 jobs.

“We have other challenges we have to face. It’s not only energy,” Leclerc stressed. “All our stakeholders need to be involved in the search for a global solution.”

(Fort Frances Times)

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