Energy / Business New Brunswick
Ministers issue joint statement about proposed energy agreement with Hydro-Québec (09/11/02)
Nov. 2, 2009
FREDERICTON (CNB) - The following joint statement was released today by Energy Minister Jack Keir and Business New Brunswick Minister Victor Boudreau about the
proposed energy agreement between New Brunswick and Hydro-Québec:
Over the past few days there has been a great number of questions about what the proposed energy agreement between New Brunswick and Hydro-Québec would mean for New
Brunswickers now and into the future.
Given the importance of this proposed partnership with Hydro-Québec, we feel it is important to set the record straight on a number of issues.
Retaining control of energy policies
The suggestions that New Brunswick would give up control of its energy policies to Hydro-Québec are unfounded.
- Under this proposed agreement, the New Brunswick government would continue to be the body that makes decisions on matters such as new power developments.
- The memorandum of understanding (MOU) outlines Hydro-Québec's commitment to work with the government and the private sector to strengthen New Brunswick's position
as an energy hub through the construction of additional infrastructure to meet the energy demands of the northeast United States.
- New Brunswick would continue to have an open transmission network allowing for market competition.
- NB Power would still be regulated and overseen by the New Brunswick Energy and Utilities Board (EUB).
- New Brunswick is the only Atlantic province that owns its power utility. Fortis owns Maritime Electric and Newfoundland Power; Emera owns Nova Scotia Power.
Future rate increases
The proposed agreement would provide New Brunswickers with lower power rates well beyond the first five years in which rates would be frozen, by limiting future increases to
inflation and new generation needs.
- Inflation has grown by less than two per cent during the past 15 years, and is projected to remain this low for the next 20 years. Under the proposed agreement, Hydro-Québec
would supply New Brunswick with enough power to meet the current needs of all residences and businesses.
- If New Brunswick's power demands grow beyond the 14 terawatt-hours provided for in the agreement, new power generation would go to the lowest bidder in a competitive
process also overseen by the EUB.
- Under the status quo, the costs of new generation would still have to factored into power rates over and above the expected three per cent increases. However, under the proposed
agreement, the price of meeting New Brunswick's existing power needs is substantially lower.
Rate savings for residential customers
Through this proposed partnership, $5 billion in rate savings would benefit New Brunswickers in every region of our province.
- 60 per cent of the rate benefits would be directed to residential and small business customers.
- $2 billion in savings would go directly to residents; $2 billion would benefit industries; and $1 billion would help small businesses.
- Although New Brunswick's industries would receive a one-time reduction in rates, they would be subject to rate increases beginning next year, while residential customers would
not see their rates increase for the next five years.
NB Power's financial position has made it difficult to control rate increases, and, without this proposed agreement, keeping rates affordable for customers would continue to be a
- Under the status quo, rates are expected to increase by at least three per cent annually during the next five years.
- Cancelling those increases means that each New Brunswick household would pay much lower rates - at least 15 per cent lower - in the future, and receive savings worth nearly
$1,400 over the next five years. New Brunswick households would each continue to save at least $465 each year.
Consulting New Brunswickers
In closing, we again invite New Brunswickers to become informed about this proposed agreement, and to provide feedback. More information is available online at
www.lowerratesnb.ca, or through our toll-free telephone number, 1-800-533-3086.