2nd N.B. Power rate decision means double-digit increase in April bills
Customers can expect a 13 per cent increase in April, but it may not last long
New Brunswick's Energy and Utilities Board has approved a second N.B. Power rate hike in as many weeks, raising power bills by about 13 per cent this April, according to the province's public intervener.
On Tuesday, the EUB approved a three per cent rate increase because the utility's operating costs were higher than expected.
This increase is separate from an interim one approved last week of 9.8 per cent for residential customers.
Public intervener Alain Chiasson said his office has strongly pushed back against the previous rate hike, but his ability to do so for the latest hike is more restrained.
"We've made the argument that these are unprecedented rate increases," Chiasson said.
"We couldn't make that for the … increase of three per cent … It's mostly an accounting calculation."
Depends on actual costs
The latest hike is related to N.B. Power's regulatory variance account.
Regulation "now requires N.B. Power to file a Variance Account Recovery" with the New Brunswick Energy and Utilities Board (EUB) each fiscal year," the utility says on its website.
"If actual costs come in lower than anticipated, New Brunswickers can receive a reduction in rates. If actual costs come in higher than anticipated, New Brunswickers can receive an increase in rates."
For the last fiscal year, costs were higher than expected, which means an automatic rate hike to make up the difference.
The back-to-back rate hikes, while unrelated, mean New Brunswickers will face a double-digit rate increase starting April 1.
While the three per cent hike can't be appealed, the 9.8 per cent increase is only an interim one, with a hearing scheduled for May and a final decision expected for June.
This means the double-digit increase could be temporary and customers may be credited later.
"There's a mechanism to invoice the customer … retroactively and give them a credit on their invoice," Chiasson said.
ABOUT THE AUTHOR
With files from Rachel Cave
CBC's Journalistic Standards and Practices
Yea Right This government lawyer refused to even speak to me last year and I had intervened in two EUB matters before Higgy hired him before he got his license to practice law.
Most of us are getting 0% raises. Now we have a 13% increase in our power bill plus more carbon tax on top of that. The new license plate motto should be “The Heck With This Place.”
Politicians have themselves big fat juicy pay raises right across the board. Very frustrating.
How to keep secrets from the public: Don't write anything down
Public servants in N.B. don't have to document their work, something advocates want done across Canada
Karissa Donkin · CBC News · Posted: Oct 07, 2022 6:00 AM ADT
N.B.'s Point Lepreau nuclear plant ranked as poor performer among international peers
Consultant ranks Lepreau in 'bottom quartile' in multiple performance categories
Since 2014 the Point Lepreau nuclear generating station has been one of the poorest-performing reactors among dozens of similar facilities in five countries, a pair of unflinching reports commissioned by N.B. Power about the troubled plant suggest.
The U.S.-based energy consulting firm ScottMadden found N.B. Power spent less on upkeep at Lepreau since it completed a major refurbishment in 2012 than owners of more reliable reactors, and they provided evidence that Lepreau's troubles may be connected to a failure to invest enough on maintenance.
The reports also suggest Lepreau's performance may worsen in future years if amounts spent on keeping ahead of trouble are not increased significantly.
"Although the refurbishment initially improved Point Lepreau's performance as expected, in recent years, Point Lepreau has missed its reliability-related projections for outage durations, capacity factors, forced loss rates, and other measures," wrote the company in one of two separate reports.
"ScottMadden found that Point Lepreau largely has performed in the bottom quartile among single-unit sites and in the bottom half among individual CANDU units from 2014-2021, and their capital spending has largely been in the bottom quartile among single-unit sites."
The reports on Lepreau, which were delivered to N.B. Power in December, have been submitted to the New Brunswick Energy and Utilities Board as evidence in N.B. Power's upcoming rate hearing.
The
50-year-old Monticello nuclear plant in Minnesota was listed as the
most reliable of 19 American single-reactor nuclear sites that were
compared to Point Lepreau in a recent evaluation. It operated at an
average capacity factor of 96 per cent over a five-year period ending in
2022, while Lepreau operated at an average of 79 per cent, better than
just two of the American reactors. (AP)
In one report, ScottMadden was asked to evaluate N.B. Power's plans to increase and then decrease capital spending at the nuclear plant over the next decade. In the second, it was asked to assess N.B. Power's current projections of Lepreau's likely future performance.
Both painted unflattering pictures of the nuclear plant's recent past and potential future.
Lepreau, originally commissioned in 1983, had a disappointing production record in its first 25 operational years that has continued over the last decade, despite a major overhaul of its reactor and nuclear components between 2008 and 2012.
In the 11 years from 2013 and 2023, Lepreau suffered 400 more days of downtime than originally projected, costing the utility up to $1 billion in lost production and repair costs that have been battering the utility's finances.
Some of that excess downtime was caused by scheduled maintenance outages that took longer than planned, and about half were "forced loss" days caused by sudden and unexpected breakdowns at the plant.
In its review, ScottMadden looked at Lepreau's operational performance over eight years ending in 2021 and compared it to 42 "peer" facilities.
Those included 23 other functioning CANDU reactors in Canada, Argentina, Romania and South Korea, and 19 non-CANDU "single unit" reactor sites in the United States.
Planned and unplanned downtime at Lepreau was consistently worse than the group average over the eight years, with ScottMadden drawing particular comparisons to a pair of Romanian CANDU reactors at Cernavoda that it said were an "identical" design to Lepreau.
Energy
consulting company ScottMadden has operations in three U.S. cities,
including this office in Atlanta. The company says there is likely a
connection between levels of annual capital spending at nuclear plants
and annual performance. (Cornerstone Contracting)
In 24 combined operational years among the two Romanian reactors and Lepreau between 2014 and 2021, ScottMadden said six of the seven least-productive years belonged to Lepreau, including the four worst years
"Point Lepreau performed poorly relative to Cernavoda," noted the report.
ScottMadden said compared to other nuclear sites with a single reactor, N.B. Power consistently spent less on annual capital improvements than those with a better performance record.
It said utilities that spend between $100 and $120 million per year on capital improvements on their single-unit nuclear plants showed the "highest marginal returns" in performance improvement.
By contrast, it found annual capital spending of less than $80 million is "slightly more likely than not to result in performance declines." In N.B. Power's case, it said annual capital spending over the eight-year period averaged below $50 million.
"Point Lepreau's annual capital spend fell in the bottom quartile for five of the eight years and in the bottom half for all eight years," said the report, citing that as a potential source of Lepreau's weak performance
N.B. Power has disclosed an intention to increase capital spending at Lepreau above $80 million but only for next year. After that, it has a plan to reduce capital spending in stages until it falls below $40 million per year in 2032 and beyond.
This
chart shows recent production troubles at Point Lepreau compared to
other Canadian-based CANDU reactors and American PWR (pressurized water)
and BWR (boiling water) reactors. (ScottMadden)
ScottMadden said it is not aware of another reactor planning to spend less on upkeep in those years and suggested that may come with consequences.
"It is likely that performance could drop even further in the late 2030's into the 2040's," it said.
N.B. Power projects, and ScottMadden concurs, that performance at Lepreau in terms of operational days and "forced loss" breakdown days are unlikely to escape the "bottom" quarter that peer reactors have recently been posting until at least 2031.
In response to pre-hearing questions posed about why it feels Lepreau cannot perform better in relation to other reactors, the utility said it is pushing for modest improvements between now and 2031 and will revaluate targets and budgets for Lepreau as it goes.
"The forecasted plans show a realistic projection for improved performance over those years," said N.B. Power in one response.
"As actual year after year progress is realized, adjustments may be necessary to those targets."
ABOUT THE AUTHOR
Maybe the better choice of word
CBC News · Posted: Jan 16, 2008 6:29 AM AST
Nuclear safety watchdog head fired for 'lack of leadership': minister
CBC News · Posted: Jan 16, 2008 6:29 AM AST
Nuclear safety watchdog head fired for 'lack of leadership': minister
Federal Natural Resources Minister Gary Lunn defended his decision to fire the head of Canada's nuclear safety watchdog Wednesday, arguing she lost the government's confidence over the way she handled the shutdown of a medical isotope-producing nuclear reactor late last year.
Natural
Resources Minister Gary Lunn blamed the CNSC head Linda Keen for the
reactor shutdown that caused the shortage of medical isotopes. ((CBC))
Canadian Nuclear Safety Commission president Linda Keen was let go hours before she and Lunn were set to appear before a House committee in Ottawa on Wednesday. Keen subsequently backed out.
An e-mail sent to the natural resources committee from a CNSC official said that since Keen is no longer the president, she wouldn't be appearing.
Lunn appeared before the committee Wednesday morning in what was his first time speaking publicly about the issue in more than a month.
"The extended shutdown of the reactor threatened a national and international health crisis," he said at the start of his speech.
'People invariably would have died'
The minister took aim at Keen's management of the crisis, accusing her of a "lack of leadership" and saying she failed to resolve an impasse between the commission and the Atomic Energy of Canada Ltd., the Crown corporation that operates the facility, located in Chalk River, Ont.
The former head of the Canadian Nuclear Safety Commission, Linda Keen, will remain a member of the commission. ((CBC))
He suggested Keen tried to obstruct efforts to quickly resolve the growing crisis.
"It became very clear very quickly [to] even her own officials and AECL and independent experts that, in fact, this was not about safety. This was a potential difference in opinion between the two agencies with respect to licensing," Lunn said.
He said the government consulted with 800 health-care facilities across Canada, including nearly 250 nuclear medicine facilities, to understand the impact of the shortage.
"From the government's discussion with medical experts, it was obvious — the isotope shortage was potentially very serious," said Lunn.
"It was also clear, Mr. Chair, had we not acted, that people invariably would have died … We could not let that happen. We had to act, and we did," said Lunn.
Decision to fire Keen made on Tuesday
The commission ordered the reactor to close on Nov. 18 over safety concerns about the emergency power system not being connected to cooling pumps, as required to prevent a meltdown during disasters such as earthquakes.
The
reactor facility in Chalk River, Ont., is pictured in this photograph
from 1985. Medical isotopes produced there are key to diagnosing and
treating various cancers. ((Canadian Press))
The closure of the 50-year-old reactor, which generates two-thirds of the radioisotopes used around the world in medical procedures and tests, prompted a worldwide shortage of the crucial medical material.
In December, Parliament ordered the facility to reopen, and Lunn and Keen have been at odds ever since.
Lunn said that even CNSC's director general of nuclear cycle and facilities regulation indicated the reactor was as safe as ever, even without the additional safety requirements for the cooling pump system.
The minister added that the decision to fire Keen was made on Tuesday, days after she publicly accused him of interfering with the independence of the arm's-length watchdog.
In a Dec. 27 letter to Keen leaked to the Ottawa Citizen newspaper, Lunn questioned her judgment for recommending the reactor be shut down and informed her he was considering having her removed from the post.
Keen responded with an eight-page letter accusing Lunn of improper interference and threatening to fight in court any attempt to remove her from her job. She also said she had asked the privacy commissioner and the RCMP to investigate how Lunn's letter was leaked to the media.
'Blatant political interference'
Liberal Natural Resources critic Omar Alghabra said Lunn was making history by "crossing the line" with his "blatant political interference" in a quasi-judicial tribunal.
Another Liberal MP, Lloyd St. Armand, questioned whether Lunn had gone against the government's code of conduct by making two phone calls to Keen about the situation.
The code states that ministers should not intervene or appear to intervene in quasi-judicial tribunals on issues requiring a decision.
Lunn responded that the calls were to obtain information from Keen, as is "completely appropriate" for any minister.
Liberal MP David McGuinty accused the Conservatives of U.S. Republican-style tactics by dismissing Keen in the "dark of night," just hours before she was due to testify before the Commons committee.
"These are the kind of Republican tactics this town has never seen before, that are new to Canadians," McGuinty told the committee. "What kind of conduct is this, minister? What kind of government are you a part of?"
Keen still a commission member
Keen, who became head of the commission in 2001 and had been serving her second five-year term as president, will remain a member of the commission.
Assistant deputy industry minister Michael Binder has been named as interim president.
The Conservative government has blamed the commission's intransigence for creating the crisis. And Prime Minister Stephen Harper pointed a finger directly at Keen, a career bureaucrat whom he referred to as a Liberal appointee.
"The course of action contemplated was extremely ill advised, an appalling use of authority and judgment," Harper told CBC News in December.
A ministerial directive on Dec. 10 ordered the CNSC to reopen the site. The agency refused, insisting a backup safety system be installed to prevent the risk of a meltdown during an earthquake or other disaster.
On Dec. 11, an emergency measure passed through the House of Commons overturned the watchdog's decision, and the reactor was restarted for a 120-day run on Dec. 16.
With files from the Canadian Press
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