Big industry seeks exit from N.B. Power grid

Large industrial companies in New Brunswick are making a push to exit the N.B. Power grid and generate their own renewable electricity in a move the utility says could leave other ratepayers facing higher bills.

The request — delivered publicly by J.D. Irving Ltd. to a committee of MLAs last September — has now earned the backing of the province’s Liberal natural resources minister.

John Herron says high power rates threaten the future of forestry jobs and if companies can generate their own cheaper electricity, the government should remove the legal barriers that now prevent them from doing so.

“It just makes sense for a company, whether it’s J.D. Irving or others, to allow them to defend themselves to keep themselves competitive, allow them to deploy their own capital, to make their own installations in that regard,” Herron said.

N.B. Power says taking some of the biggest electricity customers off the grid could leave the remaining ratepayers having to cover more of the utility’s massive costs via higher rates.

“If large industrial facilities were able to generate their own electricity, there is a possibility it could cause upward pressure on rates for remaining customers if other measures were not taken to mitigate that impact,” spokesperson Elizabeth Fraser said in an email.

One such measure would be an exit fee large enough to blunt the impact on other ratepayers, says Green Leader David Coon.

Coon worries that figure would not be set at a sufficiently high level.

“The temptation by N.B. Power and the province would be to have the other ratepayers bear some of that so the exit fee wouldn’t be as big as it should be,” Coon said.

In December, N.B. Power signed an agreement with J.D. Irving to buy 200 megawatts of power a year from its Brighton Mountain wind farm, the company’s first venture into wind energy.

The utility is the exclusive buyer of the power from the first phase of the project, which Fraser said will “help make the energy transition more affordable for New Brunswickers.”

The policy change Irving is seeking would made that kind of deal unnecessary in the future.

Irving Pulp and Paper vice-president Mark Mosher told the legislature’s committee on climate change last year the company’s main interest in the Brighton Mountain project wasn’t environmental but financial.

“Our ultimate goal getting of into the wind business is really to basically hedge and drive our internal electricity costs down,” he said.