Advisory panel on the Proposed New Brunswick - Québec electricity transaction
Feb 01, 2010, 10:00 ET
FREDERICTON,
In total the report of the Panel, which is made up of six well-known New Brunswickers, contained seven conclusions about the proposed agreement and also had five recommendations aimed at the government of
"Overall our investigation of the proposed agreement led us to conclude that electricity rates would be lower for
In addition, the Panel concluded significant risks that will affect rates in the near and long term will be substantially reduced should the deal be completed. "Fossil-fuelled power plants make up about 45% of NB Power's electricity generation when Lepreau is operating, while 97% of Hydro-Québec's generation comes from renewable sources," Ganong said. "NB Power's reliance on fossil fuel exposes us to fuel price escalation and volatility."
Climate change was another area that the Panel focused on. "All fossil-fuelled plants are expected to face greenhouse gas (GHG) regulations that are increasingly stringent. The estimated cost risk for NB Power to meet future GHG regulations could be well over
"In addition, NB Power is faced with replacing several generating facilities over the next 20 to 25 years, including Mactaquac by 2030, Belledune by 2033 and Point Lepreau by 2035. These significant capital expenditures would have to be rolled into rates under the status quo, with Mactaquac alone expected to be in the $2-3 billion range," Ganong said.
"With this agreement, a substantial portion of the NB Power debt would be moved to Hydro-Québec and future debt accumulation for replacing or refurbishing generation would be avoided," he said. "We are a province with a small population base and to take on debt of the magnitude we are speaking about would be crushing, both in terms of the rates for electricity we would have to charge and our ability as a province to invest in things like health care and education."
Among the recommendations the Panel makes are that the province strengthens the regulatory framework as soon as possible to provide broader authority and oversight for the
"Our conclusion is that the benefits to
For further information: Media Contact: Bill Whalen, [email protected], (506) 877-1554 - office, (506) 863-5510 - cell
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