Thank you, Mr. Chairman. Mr. Chairman, while the Northwest Territories Power Corporation has been established as a crown corporation, every effort has been made to allow it to operate at arm's-length from usual government process as an independent, regulated utility. Today, the corporation is fully regulated and operates in competition with northern subsidiaries of Edmonton-based Canadian utilities.

Mr. Chairman, the 1994-95 O and M budget was approved by the corporation's board of directors on March 9, 1994. On March 14, 1994, Public Utilities Board (PUB) decision 2-94 was issued. This decision will result in revisions to the budget. The decision, including the 14 directives, has significant O and M and revenue impacts. For example, the board rejected the corporation's application for a 2 per cent general rate increase in the 1994-95 budget.

Mr. Chairman, on the positive side, as a result of PUB review and revision to the corporation's Phase I general rate application, it appears that the corporation, for the second consecutive year, will be at or near its approved rate of return. The effects of several Government of the Northwest Territories initiatives are beginning to impact on the corporation's projected revenue. This budget reflects a budget reduction of $1 million in revenues due to the user- pay initiative.

As government domestic accounts are transferred to the employee's name, a reduced non-government domestic rate applies. However, as a consequence of this new responsibility for bill payment, customers are exercising demand side management (DSM) initiatives and are reducing consumption. The lower rate and reduced consumption results in a reduction in revenue for the corporation. As well, since the corporation is faced with added cost to the power subsidy program, the impact on the corporation is threefold. Depending on rate of implementation, this reduction in revenue could reach $2 million in 1995.

Mr. Chairman, the corporation is in support of the user-pay initiative, and it is important to note that this and other proposals, while reducing GNWT expenses, simply shift the cost burden to the corporation and, by extension, to the electrical ratepayer.

Over the next two years, the change of up to 2,000 electrical hot water heaters to oil-fire heaters is expected to reduce revenue by approximately $2.9 million. Again, the corporation supports this initiative and, through consultation and phased elimination, the impacts on corporation revenues can be reduced or spread over a period of time.

Mr. Chairman, since last appearing before this committee, the corporation has continued to deal with BHP and Kennecott for the supply of power to their properties in the north Slave. The corporation's agreement with the Dogrib Power Corporation continues. A tender closing for project construction took place in Yellowknife on March 14, 1994.

With respect to this government's privatization initiative, it is my expectation that an information item in support of the March 1993 Abbott proposal will be tabled in this Assembly prior to the April recess.

Mr. Chairman, those are the opening remarks that I have at this time.