A key adviser to the B.C. Liberals transition team into government has been appointed chair of B.C. Hydro.

Larry Bell, the overseer of the Liberals' reorganization scheme of the provincial government, was appointed Thursday.

He was the Hydro chair from 1987 to 1991.

A former deputy minister of finance under the Social Credit government, Bell has extensive experience on utility boards in the public and private sector.

Until his appointment Thursday, he was chair of the White Spot restaurant chain.

"Any objective observer would say he's one of the top picks you can have for this job," said Premier Gordon Campbell.

Even before the Liberals won their massive majority in May, Bell's potential role in the new government was criticized by the New Democratic Party. During the election campaign, Joy MacPhail -- now Opposition leader -- issued a press release saying that as a director of BC Gas and TransAlta Corp., Bell would benefit financially if the Liberals privatize B.C Hydro.

The Liberals passed legislation last week that will allow directors of Crown corporations to hold shares, flipping a previous bill that forbids anyone -- such as B.C. Hydro directors -- from holding shares in energy utilities.

Bell said Thursday he has sold all his shares in BC Gas and TransAlta and no longer owns any stock in utility companies, despite the new government legislation that will allow him to have such business interests.

"It's not worth it to be cute about things; I've learned that about public life," Bell said. "The legislation was changed so I could recruit a board who had experience and would not need to liquidate their holdings."

The only energy shares Bell said he still holds are stocks in a natural gas firm and an exploration development corporation.

As for privatization, which the NDP has steadily maintained will happen under Campbell, Bell said he has no new direction from the premier.

"Nothing except for the commitment that the premier has given that it will not happen," he said. "I think it's quite clear the premier wants the very best advice and my experience working with him over the years is he wants you to tell him not what he wants to hear, but the best advice possible."

Since his last tenure as B.C. Hydro chair, Bell said the world has changed dramatically.

"One of the things that people link is the whole question of restructuring deregulation and privatization. I think they're quite separate," Bell said. "I would say Hydro needs to be ready for further deregulation.

One of his first priorities, Bell said, is to figure how to get more private gas generators in operation on the Columbia or Peace rivers before the anticipated supply runs out by 2005 or 2006. It will take at least 11 years before more hydro generators are operational.

Independent power producers will play a key role in the province's future energy needs, he said. Bell said the government wants independent power producers to stand alone and sell electricity directly to customers rather than sell to Hydro for resale.

The other major thrust in Hydro policy will be the separation of transmission and generation.

"Ferc [the U.S. Federal Energy Regulatory Commission] is pushing for common carriers from Mexico to Alberta," Bell said. "B.C. Hydro must also become a common carrier if it wants to trade and keep its licence to sell into the U.S."

The transmission facilities could be rolled into a separate company wholly-owned by Hydro or they could be run by a not-for-profit corporation that doesn't have any share capital and therefore no equity owners, such as Vancouver International Airport.

"Ferc wants as much distance as possible between the operator of the transmission system and owner-operator of the generation facilities," Bell said.

However, he said neither the transmission nor the generation units will be privatized.

"The dams and rivers will be kept as a Crown corporation," Bell said.

Bell has been chair and president of the Westar Group, CEO of Vancouver City Savings Credit Union and, most recently, president of Shato Holdings, which owns the White Spot chain of restaurants.

In the public sector, he has served as deputy finance minister, secretary to the Treasury Board, deputy minister of housing, lands and parks, and deputy minister responsible for transit.

He is also chair of the University of British Columbia board of governors and a director of several companies, including Canadian Hunter Exploration, International Forest Products and Miramar Mining.

Michael Costello, who has been president of B.C. Hydro since 1996, has been appointed to the company's board of directors.

http://www.vancouversun.com/newsite/business/5067948.html

---END---