Premier says potential Lepreau sale 'shouldn't be a public debate'
Higgs says it’s too early to discuss how province might benefit from selling nuclear reactor
Opposition parties demanded Thursday that Higgs give New Brunswickers a better idea of where a sale of Lepreau would fit in the province's long-term energy strategy and what the benefits and costs of a deal might be.
But Higgs deflected the questions and offered no additional information during a scrum with reporters afterward.
"Right now, it shouldn't be a public debate," he said.
"Right now, it should be companies talking to each other about potential scenarios. … That's what the negotiation process is. It's not a public debate."
Point Lepreau has been plagued by breakdowns and other problems since a $2.4-billion refurbishment ended in 2012. (Shane Fowler/CBC)
N.B. Power confirmed Wednesday that its discussions with Ontario Power Generation could lead to "some OPG ownership" of Point Lepreau.
"Is this going to cost us money or are we going to make money? … Are we buying OPG's expertise or are we selling the asset?" Opposition Liberal energy critic Keith Chiasson asked during question period at the legislature.
"There's a secret deal cooking behind the curtains, and you're not sharing that information with the people of New Brunswick."
Higgs told reporters the issue would be debated publicly "once there is a plan."
"But you can't have two companies negotiating a deal back and forth in the public domain. That's not how you're going to come up with the best result for all."
'Public assets'
Green leader David Coon said the premier's approach reminded him of the secrecy surrounding the 2009 agreement, later cancelled, to sell N.B. Power to Hydro-Quebec.
David
Coon, leader of the Green Party, said the people of New Brunswick need
to hear from the premier what the plan is for Lepreau. (Jacques Poitras/CBC)
"It's not acceptable. It's a public utility. These are public assets," Coon said.
"And the public, the people of New Brunswick, need to hear from the premier what the plan is, not what the final result is after all the negotiations are done."
Higgs brushed off the comparison, saying then-Liberal premier Shawn Graham knew the details of the Hydro-Quebec deal before it was revealed publicly.
"We don't know what a partnership or relationship might look like, so that's why it's early days to say what it could be," Higgs said.
The premier suggested Wednesday that the utility, with its fleet of nuclear reactors in Ontario, has the expertise and experience to improve the performance of Lepreau.
The plant has been plagued by breakdowns and other problems since a $2.4-billion refurbishment ended in 2012.
The
premier said Thursday that the rationale for a deal with Ontario Power
is mainly about collaborating on the next generation of small modular
nuclear reactors. (CBC News)
The repeated breaks in service have cost N.B. Power millions. A shutdown last December wiped out all of the utility's projected profit for this year, adding to its $5.3 billion debt.
University of Moncton engineering professor Yves Gagnon, a vocal critic of the proposed 2009 sale to Hydro-Quebec, says selling Lepreau makes sense because the influx of cash would pay down part of that debt.
"We would significantly reduce the debt of N.B. Power [and] we could significantly reduce the financial risk for the population of New Brunswick, risk that would be absorbed by these large corporations that can absorb the financial risk on a global basis."
Gagnon said a company with a fleet of nuclear reactors wouldn't be financially affected as much by "swings" in Lepreau's performance as N.B. Power is.
"For them, the risk is much smaller than the risk for N.B. Power."
The province should be holding a competitive bidding process for the plant, he said.
Yves Gagnon said an $881 million decommissioning fund would be a boon for N.B. Power in any negotiations. (CBC)
The nuclear plant was valued at $1.4 billion when Hydro-Quebec planned to buy it. It is expected to operate until 2040.
Gagnon said an $881 million decommissioning fund — money set aside over the years to pay for the eventual shutdown of Lepreau — would be a "trump card" for N.B. Power in any sale negotiations.
The premier insisted to reporters Thursday that the rationale for a deal with Ontario Power is mainly about collaborating on the next generation of small modular nuclear reactors.
That's contradicted by an internal email by the utility's CEO Ken Hartwick, made public by Chiasson, which describes "a potential partnership at Point Lepreau" and makes no mention of SMRs.
"You can ask what you want," Higgs responded. "My answer's about the future."
On Wednesday morning, the premier refused to say whether Lepreau might be sold. It was N.B. Power that confirmed later in the day that a sale was an option.
Sale 'hypothetical,' said premier
Higgs defended that ambiguity Thursday.
"I didn't deny or confirm because I do not know what's going to be the conclusion."
He also wouldn't say whether he and his cabinet would approve a sale if that's what the two utilities negotiate.
"I am not going to presuppose any hypothetical situation," he said.
Chiasson said the opposition Liberals are not necessarily opposed to a sale but they want the public to have more information.
"I think we're open to it. I'm not disagreeing with the premier saying that everything's on the table. I think it's a good thing that we're exploring what we do with that asset."
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Re: Matter 529 - NB Power Rate Design Even more Interesting news from CBC
David Amos<david.raymond.amos333@gmail.com> | Wed, Mar 29, 2023 at 10:52 PM |
| To: "Holland, Mike (LEG)" <mike.holland@gnb.ca>, "blaine.higgs" <blaine.higgs@gnb.ca>, "Robert. Jones" <Robert.Jones@cbc.ca> | |
| Cc: "Abigail J. Herrington" <Aherrington@lawsoncreamer.com>, "Mitchell, Kathleen" <Kathleen.Mitchell@nbeub.ca>, "Williams, Richard (OAG/CPG)" <Richard.Williams@gnb.ca>, "ceo@fermenbfarm.ca" <ceo@fermenbfarm.ca>, "louis-philippe.gauthier@cfib.ca" <louis-philippe.gauthier@cfib.ca>, "frederic.gionet@cfib.ca" <frederic.gionet@cfib.ca>, "Ron.marcolin@cme-mec.ca" <Ron.marcolin@cme-mec.ca>, "Sollows, David (DNRED/MRNDE)" <David.Sollows@gnb.ca>, "hanrahan.dion@jdirving.com" <hanrahan.dion@jdirving.com>, "nrubin@stewartmckelvey.com" <nrubin@stewartmckelvey.com>, "coneil@stewartmckelvey.com" <coneil@stewartmckelvey.com>, "lmclements@stewartmckelvey.com" <lmclements@stewartmckelvey.com>, "pbowman@bowmaneconomics.ca" <pbowman@bowmaneconomics.ca>, "brudderham@stewartmckelvey.com" <brudderham@stewartmckelvey.com>, "JohnFurey@fureylegal.com" <JohnFurey@fureylegal.com>, "jpetrie@nbpower.com" <jpetrie@nbpower.com>, "NBPRegulatory@nbpower.com" <NBPRegulatory@nbpower.com>, "lgordon@nbpower.com" <lgordon@nbpower.com>, "SWaycott@nbpower.com" <SWaycott@nbpower.com>, "George.Porter@nbpower.com" <George.Porter@nbpower.com>, "bcrawford@nbpower.com" <bcrawford@nbpower.com>, Veronique Otis <Veronique.Otis@nbeub.ca>, "Young, Dave" <Dave.Young@nbeub.ca>, NBEUB/CESPNB <General@nbeub.ca>, "Colwell, Susan" <Susan.Colwell@nbeub.ca>, "bhavumaki@synapse-energy.com" <bhavumaki@synapse-energy.com>, "mwhited@synapse-energy.com" <mwhited@synapse-energy.com>, "prhodes@synapse-energy.com" <prhodes@synapse-energy.com>, "alawton@synapse-energy.com" <alawton@synapse-energy.com>, "jwilson@resourceinsight.com" <jwilson@resourceinsight.com>, "pchernick@resourceinsight.com" <pchernick@resourceinsight.com>, Melissa Curran <Melissa.Curran@nbeub.ca>, "rdk@indecon.com" <rdk@indecon.com>, "tammy.grieve@mcinnescooper.com" <tammy.grieve@mcinnescooper.com>, "paul.black@twinriverspaper.com" <paul.black@twinriverspaper.com>, Len Hoyt <Len.Hoyt@mcinnescooper.com>, "tyler.rajeski@twinriverspaper.com" <tyler.rajeski@twinriverspaper.com>, "darcy.ouellette@twinriverspaper.com" <darcy.ouellette@twinriverspaper.com>, "dan.murphy@umnb.ca" <dan.murphy@umnb.ca>, "jeff.garrett@sjenergy.com" <jeff.garrett@sjenergy.com>, "shelley.wood@sjenergy.com" <shelley.wood@sjenergy.com>, "dan.dionne@perth-andover.com" <dan.dionne@perth-andover.com>, "pierreroy@edmundston.ca" <pierreroy@edmundston.ca>, "ryan.mitchell@sjenergy.com" <ryan.mitchell@sjenergy.com>, "sstoll@stollprofcorp.com" <sstoll@stollprofcorp.com>, "pzarnett@bdrenergy.com" <pzarnett@bdrenergy.com> | |
Ontario utility could become partial owner of Point Lepreau nuclear plant
Premier says after ‘ups and downs’ at Lepreau, deal could lead to better operation of troubled facility
Utility spokesperson Dominique Couture told CBC News an eventual agreement "could include some OPG ownership in the station."
Premier Blaine Higgs confirmed to reporters Wednesday that the Ontario Crown corporation is meeting with officials in the coming weeks to discuss improving the operation of New Brunswick's only nuclear power plant.
"The fact that they run multiple nuclear generators, and we only have one, means they have a level of expertise there. And we've gone through some of the ups and downs of Lepreau, especially in the last few years," he said.
"So how can we get better capacity there? And how can we turn that into a partnership for future generation?"
Premier Blaine Higgs said he thinks a partnership is needed and could be beneficial. (Radio-Canada)
Asked if Point Lepreau could be sold to Ontario Power, Higgs did not rule it out.
"We don't have a plan. I don't know what an operating structure might look like, and the discussions with OPG have been [happening] for years.
"But I think we need to have a partnership, and at the end of the day we can build on that partnership. And I don't know what that looks like."
Point Lepreau has been plagued by problems since a four-year, $2.4-billion refurbishment project ended in 2012.
A December breakdown at the nuclear plant added another $380 million to N.B. Power's accumulated debt, driving it to $5.3 billion and wiped out a projected $45.7-million profit at the utility this year.
All possible options considered, utility says
In a statement, N.B. Power said "the status quo is not an option" for the utility, which is saddled with debt and facing several other costly refurbishments.
"All possible options are being considered as we lay out a path for a very different future that will ensure we have affordable, safe and reliable electricity for our customers and improved financial health," said Couture.
"N.B. Power has successfully utilized partnership models in the past to help resolve long-standing issues and improve performance. This included sharing of key talent, operating experience and industry best practices."
Higgs compared a possible Ontario deal with Hydro-Quebec's role in the proposed Mactaquac dam upgrade. (James West/The Canadian Press)
Higgs also pointed to agreements with other utilities, comparing a possible Ontario Power deal with Hydro-Quebec's role in the proposed $3-billion upgrade of the Mactaquac hydroelectric dam.
"We look to a nuclear operator that's much larger than us, has much more experience than us. Are we afraid to ask? Not on your life."
Details still being discussed
The discussions with the Ontario utility were revealed during Question Period in the legislature when Tracadie Liberal MLA Keith Chiasson produced a screen image of an email sent by the Ontario utility's CEO Ken Hartwick.
"As N.B. Power looks for ways to drive to drive performance and value for New Brunswick ratepayers in the production of clean, reliable nuclear power from [Lepreau], we are exploring what benefit may exist from a partnership between the two companies," the email said.
Hartwick wrote that the details were still being discussed but Ontario Power officials would be visiting the Lepreau plant next week.
"The partnership we are building with N.B. Power will be a business relationship made in the best interest of Ontario," he said.
Higgs
told reporters an agreement with Ontario Power would also help the two
provinces avoid competing with each other in the field of small modular
nuclear reactors. (Adrian Wyld/The Canadian Press)
In a statement to CBC News, Ontario Power spokesperson Neal Kelly repeated some passages from the email and said any partnership would be "made in the best interests of Ontario and New Brunswick."
Chiasson said he's not necessarily against the Ontario utility playing a role at Lepreau, but the government should be transparent about it.
"There's nothing wrong with that," he said. "If there is negotiating going on with OPG, we should know."
Green Leader David Coon said the argument that Ontario Power could help run Lepreau better was curious because N.B. Power has justified the salary of its vice-president nuclear, Brett Plummer, "based on his ability to run Point Lepreau well."
In 2017, N.B. Power confirmed that Plummer was being paid $500,000 US, or about $655,000 Cdn at the time, more than the utility's CEO.
Higgs told reporters an agreement with Ontario Power would also help the two provinces avoid competing with each other in the field of next-generation small modular nuclear reactors.
The Ontario Power email doesn't mention small modular nuclear reactors, but the premier said partnering with the utility would allow for a "a pan-Canadian approach" on promoting the technology.
The
Atlantic Loop would expand the electrical grid connections between
Quebec and New Brunswick and New Brunswick and Nova Scotia to provide
greater access to renewable electricity, like hydro from Quebec. (CBC)
Higgs also told reporters he welcomed measures in the federal budget Tuesday that might make the proposed Atlantic Loop more financially viable.
The plan would link electrical grids and upgrade transmission links in the four Atlantic provinces and Quebec to allow more selling of carbon-free hydroelectric power around the region.
Ottawa's budget will allow such projects to be paid for over a 30-year timeline and make them eligible for a 15-per-cent tax credit.
Higgs has been hesitant about the potential cost of the project, but said the federal policy moves could make it more affordable.
"I see a shift there in the federal government's philosophy, so we'll look at the loop, at the benefits to New Brunswick and the benefits to Atlantic Canada," he said.
ABOUT THE AUTHOR
David Amos
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> https://www.cbc.ca/news/
>
> Saturday price hike for electricity in N.B. a projected 4.8 per cent
>
> Changes ordered by utility board cut $50 million from proposed increase
> Robert Jones · CBC News · Posted: Mar 28, 2023 3:04 PM ADT
>
> A women in a suit looks off to the side.
> Lori Clark was named N.B. Power's full-time president and CEO last
> week on March 20, the first woman to hold the position. She tried
> unsuccessfully to convince the EUB to approve the utility's full rate
> request. (Jonathan Collicott/CBC)
>
> New Brunswick electricity prices will be increasing by 4.8 per cent at
> the end of this week, after changes ordered by the New Brunswick
> Energy and Utilities Board knocked $50 million off a rate request made
> by N.B. Power.
>
> In a letter to the EUB, responding to a series of changes required by
> the regulator following a two week hearing in February, N.B. Power's
> Stephen Waycott said making alterations will lower the rate increase
> from the 8.9 per cent applied for, to 5.7 per cent. An additional
> rebate due to customers from another issue that also takes effect on
> April 1 will further reduce new charges customers face.
>
> "The combined impact … is that NB Power's in-province customers will
> see an average increase in electricity rates of 4.8 percent in
> 2023/24," wrote Waycott, who is N.B. Power's director of corporate
> compliance and regulatory affairs.
>
> Every one per cent change in rates is worth just under $16 million per
> year to the utility.
> Two woman talk behind computers wearing business attire.
> Nancy Rubin (right) led a team of three lawyers hired by J.D. Irving
> Ltd. to fight N.B. Power's rate application. The group, including
> Brianne Rudderham (left), forced N.B. Power to provide updated budget
> numbers for next year that led to a reduced increase. (Ed Hunter/CBC)
>
> For a residential customer with an annual power bill of $3,000, the
> new prices will add $144 plus HST in yearly charges. Separately, the
> utilities board also approved a $1 per month increase to customers who
> rent water heaters from N.B. Power, which would add to that rate
> increase amount.
>
> The board still needs to grant a final approval to the changes, but
> that is mostly a formality. Municipal utilities in Saint John,
> Edmundston and Perth Andover are expected to adopt the same percentage
> increases for their own customers.
>
> J.D. Irving Ltd. and N.B. Power clash as rate hearings get underway
>
> Full 8.9% rate increase not required, N.B. Power hearing told
>
> N.B. Power originally applied for an 8.9 per cent increase in its
> rates in early October, hoping to have it approved for the beginning
> of its next fiscal year, which begins on April 1.
>
> It's application was challenged aggressively over eight days at
> hearings in February, especially by its largest private sector
> customer, J.D. Irving Ltd.
> A red and white sign with black letters stands in front of an
> indsutrial site with billowing smoke stacks.
> N.B. Power burns oil to generate electricity at its Coleson Cove
> generating station in Saint John. Prices for the commodity have been
> coming down which has led to a reduction in N.B. Power's rate
> increase. (Roger Cosman/CBC)
>
> The forestry, transportation and consumer products company hired three
> lawyers to fight the increase. The group successfully challenged N.B.
> Power's use of stale data in the case it was making for higher prices.
>
> N.B. Power had been claiming the high prices for commodities it uses
> to run its largest generators would attack its bottom line in the
> coming year.
>
> "In a single year, the cost of fuel and purchased power necessary to
> supply customers in New Brunswick has increased by $102.8 million,"
> N.B. Power president Lori Clark told the hearing on its opening day.
>
> "This has occurred largely due to market price increases for natural
> gas, heavy fuel oil and electricity."
> A close-up photo of a hydro meter on the side of a house.
> All New Brunswick electricity customers are likely to see a 4.8 per
> cent increase in rates beginning on Saturday. (Robert Jones/CBC)
>
> But those claims were based on old prices from months earlier in June,
> 2022.
>
> During hearings, the utility acknowledged it had fresher data
> internally that showed some prices had moderated, and prospects for
> exporting power had improved significantly.
>
> Final arguments set to begin over request for an 8.9% power rate
> increase
>
> EUB hearing room splits on endorsing N.B. Power's rate hike
>
> In a preliminary ruling two weeks ago, the EUB told the utility it
> needed to use the more up-to-date numbers.
>
> "The Board is not satisfied that the rates, as applied for, are just
> and reasonable," it wrote in demanding changes.
>
> "NB Power is ordered to refile its 2023/2024 test year budget … and
> the resulting rates."
>
> The new calculations show that despite losing one third of the
> requested rate increase, N.B. Power's projected profit for the coming
> year has more than doubled to $30 million by using the new figures.
>
> N.B. Power did not immediately respond to a request for comment about
> the changes.
> ABOUT THE AUTHOR
> Robert Jones
>
> Reporter
>
> Robert Jones has been a reporter and producer with CBC New Brunswick
> since 1990. His investigative reports on petroleum pricing in New
> Brunswick won several regional and national awards and led to the
> adoption of price regulation in 2006.
>
> CBC's Journalistic Standards and Practices
>
>
> 8 Comments
>
> David Amos
> I am an Intervener in this matter and I have received no notice of this.
>
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