Yukoners will contribute $22 million of the $40 million estimate to extend the Whitehorse-Aishihik-Faro grid from Pelly Crossing to Stewart Crossing, says the president of Yukon Energy.

David Morrison said the contribution will come from the Yukon government, and the Yukon Development Corporation.

Yukoners will also contribute $29.4 million to the $120 million Mayo B hydro expansion, he explained.

A budget document attached to the contribution agreement between Yukon Energy and Ottawa for the extension of the Whitehorse-Aishihik-Faro grid and Mayo B was delivered to members of the legislative assembly Tuesday.

The document, however, was silent on some substantial figures, as it only addressed the costs that would be eligible under the contribution agreement, such as the cost of construction, new equipment required and so forth.

There are other costs which are not eligible under the agreement, such as any costs incurred prior to the agreement being signed last May, like costs of feasibility studies or project preparations.

In the case of Mayo B, the budget delivered to the legislature shows that from the $120 estimate from the entire project, $106.7 million is eligible under the joint-contribution agreement, leaving $13.3 million unaccounted for in the document.

For the Mayo B project, the contribution agreement states:

• Ottawa will contribute up to $53.35 million of the $106.7 million from its Green Infrastructure Fund;

• Yukon Energy and the First Nation of Nacho Nyak Dun will contribute $36.7 million. (How much each of the two parties will put up is still under negotiation, Morrison explained.)

• Yukon government will contribute $16.65 million.

Morrison explained the remaining $13.3 million not covered by the agreement will be picked up by the Yukon government and the Yukon Development Corporation, which he said is essentially one in the same.

Altogether, according to the figures, Yukoners – not ratepayers – will contribute $30 million to Mayo B.

In the case of the Pelly-to-Stewart transmission line extension, the budget delivered to the legislature shows that of the $40 million project estimate, $35.3 million is eligible under the contribution agreement, leaving $4.7 million unaccounted for in the document.

A contribution of $12 million is itemized in the document, though the identity of the contributing party is blacked out.

For the Pelly-Stewart extension, the contribution agreement states:

• Ottawa will contribute up to $17.65 million of the $35.3 million;

• The Yukon government will contribute $5.35 million;

• Yukon Energy will contribute $300,000;

• The unidentified party will contribute $12 million.

Morrison said the Yukon government and the Yukon Development Corporation will cover the $4.5 million not covered by the contribution agreement.

The president of Yukon Energy said the party left unidentified for the $12 million contribution is the Yukon government and the Yukon Development Corporation.

Addition of all the figures shows Yukoners will be contributing $22 million to the extension of the transmission line.

The unidentified contributor of the $12 million was the subject of a terse exchange Wednesday between Premier Dennis Fentie and Liberal Leader Arthur Mitchell, who pressed Fentie to reveal the identity of the contributor.

"Who is that generous secret investor willing to subsidize the government's energy project to the tune of $12 million?” Mitchell asked during question period.

In his reply, the premier did not provide the identity of the contributor, but reminded Mitchell how Yukon Energy negotiated a contribution from the Minto Mine toward the extension of the transmission line from Carmacks to Pelly Crossing.

"This is similar to what the energy corporation will be working on into the future as far as building Yukon's publicly owned, through its public utility, overall infrastructure and assets,” Fentie replied to Mitchell's second attempt to get an answer.

When asked by the Star this morning who was putting up the $12 million, Morrison simply replied the Yukon government and the Yukon Development Corporation.

Morrison was not asked who blacked out the identity of the contributor, or why, and he was unavailable later this morning, as he was on an airplane south.

Cabinet spokeswoman Emily Younker said this morning she did not know who blacked out the identity of the contributor, but was certain it was not the premier or any of the political staff.

Fentie and his Yukon Party have come under fire of late from the Liberals accusing them of making a huge miscalculation with the original project estimate of $32 million for the entire Carmacks-to-Stewart extension of the main grid.

With the cost of the Carmacks-Pelly section completed a year ago for $29.5 million, and with the $40-million estimate for phase two, the budget has climbed to $70 million from $32 million, Liberal energy critic Gary McRobb reminded the legislature recently.

He suggested Fentie and his colleagues have feasted on the report by the auditor general of Canada indicating the Mayo-Dawson transmission line, which came in significantly over budget and behind schedule, was grossly mismanaged under the former Liberal government.

But now that the shoe is on the other foot, McRobb told the house, Fentie wants nothing to do with it.

In his defence, Fentie pointed out all projects in excess of $3 million, including the phase two line extension, have gone before the Yukon Utilities Board for review.

And both Fentie and Morrison have emphasized when the grid extension was originally envisioned in 2005, cost estimates for both the first and second phases were based on very preliminary numbers.

Morrison reiterated the same this morning, and he also emphasized that just because Yukon Energy is spending money, doesn't mean rates are going up.

The new assets will go into the rate base, but Yukon Energy believes the $40-million phase two extension will be rate neutral, he said.

"Ratepayers, in my estimate, are getting a great deal because these assets are going to be around for a very long time, and they are getting that benefit for a very low cost.”

Morrison also pointed out when the cost of the entire transmission line went before the utilities board a couple of years ago, the cost of phase two alone was estimated at $33 million to $35 million. The jump to $40 million today, he said, is due in part to increasing costs for new substations.

Work has already started on the phase two of the line extension to Stewart Crossing and the completion date is scheduled for the spring of 2011.

Peter Kiewet, a large international company, has already been selected to build the Mayo B project. Morrison said he expects they will be signing off on the actual construction contract in the next week or so. Construction is expected to begin this spring, with completion slated for 2012.

Mayo B will bring an additional 10 to 12 megawatts to the system, on top of the five the Mayo Dam produces now.

Morrison said he cannot break down the joint contribution of $36.5 million to the Mayo B by Yukon Energy and the First Nation of Nacho Nyak Dun simply because the deal is not done.

At this point, he said, all that's firm is that there will be a $36.5 million contribution coming from Yukon Energy and the first nation.

"How much they want to invest is still a question,” he said.

Morrison said whatever portion the first nation doesn't buy into will come from Yukon Energy and will be a cost added to the rate base.

When phase one of the grid extension to Pelly Crossing occurred, it was built largely so that a spur line into the Minto Mine could be built and the mine put on the much cheaper hydro power. Yukon Energy insisted because the extension was being built primarily to service the mine, it would not only have to pay 100 per cent of the cost for the spur line, but that it would also be required to contribute $7.2 million to the main line extension.

Yukon Energy has stated emphatically that if another industrial user like the Carmacks Copper mine ever wants to hook into the grid, it would have to contribute to phase two of the transmission line extension, under the same principle the Minto Mine was required to.

There has been no announcement of any deal to date.