Transmission tower. Photo: Wikipedia

New Brunswick’s energy watchdog is opposing NB Power’s attempt to avoid a public hearing on its controversial proposal for a 500 MW gas/diesel generating plant on the Chignecto Isthmus.

Alain Chiasson, who is head of the Office of Public Intervener for the Energy Sector, hired an expert from Calgary to file an affidavit with New Brunswick’s Energy and Utilities Board (EUB) calling for a full public hearing.

Dustin Madsen, a Calgary accountant who has been certified by the EUB as an energy expert in the past, states in his August 7th affidavit that NB Power should not be able to escape public scrutiny.

Madsen was responding to arguments from NB Power that since the U.S. company, PROENERGY is building and operating the plant, it should not be considered an NB Power capital project subject to review and approval by the EUB.

Section 107(1) of New Brunswick’s Electricity Act requires EUB approval of NB Power capital projects worth $50 million or more, but the utility argues that since it’s not building the plant, but will be buying the power under a 25-year lease agreement, it should not be considered a capital project.

In his affidavit, Madsen concedes that the law’s definition of “capital project” is ambiguous, but argues that the average New Brunswick power customer would expect EUB scrutiny.

“Take for example a situation where NB Power constructs a generation facility at a cost of $500 million,” Madsen states, adding such a project would clearly require EUB scrutiny and approval.

“If NB power leases for the construction of that facility and is in turn required to pay $700 million over the life of that lease for the same facility, then I would expect NB Power’s customers to expect that both transactions regardless of their form receive the same degree of scrutiny from the Board,” he writes.

Conservation council agrees

Moe Qureshi. Photo: CCNB

In a written statement filed with the EUB on August 11th, Moe Qureshi, of the Conservation Council of New Brunswick (CCNB), also argues the gas/diesel plant project should not escape EUB scrutiny.

“The arrangement binds ratepayers to hundreds of millions of dollars in payments over its term, with exposure to volatile fuel prices,” Qureshi writes.

“If accepted, NB Power’s interpretation would set a dangerous precedent, enabling the utility to avoid…oversight for future large-scale generation commitments by outsourcing asset ownership while retaining the financial burdens,” he adds.

During a telephone interview, Qureshi said he’s shocked that NB Power is claiming the EUB has no jurisdiction.

“The EUB is supposed to be protecting the public and should be looking out for our best interests,” he says.

“This is a project that’s going to be built in New Brunswick, The emissions are going to be in New Brunswick. The financial costs and burden are going to be on New Brunswick ratepayers. So, it certainly does need to be reviewed by the EUB,” he concludes.

Meantime, the EUB has scheduled oral arguments on September 3rd or 5th in Saint John on NB Power’s application to avoid a public hearing on the proposed  gas plant.

To read NB Power’s affidavit claiming the EUB has no jurisdiction over the gas/diesel plant , click here.

To read Dustin Madsen’s affidavit on behalf of the Office of the Public Intervener for the Energy Sector, click here.

To read the Conservation Council’s submission to the EUB, click here.