N.B. Power needs gas plant approval before April 2, or the deal may be off

N.B. Power is warning that the U.S. company it hired to build and run a billion-dollar gas plant could walk away in April — a move that would set the project back years, and possibly lead to power shortages in the province.

N.B. Power’s top financial officer said that ProEnergy has an ‘economic incentive’ to abandon the Tantramar gas plant deal if a regulatory deadline is not met. 

In a statement submitted to the New Brunswick Energy and Utilities Board, N.B. Power Chief Financial Officer Justin Urquhart asked the board to help the utility meet a deadline in its contract with ProEnergy by moving up the hearing on the project.

The hearing is now scheduled for Feb. 9 to 13, 2026.  

The contract with ProEnergy was signed on July 2, 2025, and includes a condition that gives N.B. Power nine months – until April 2, 2026 – to get Energy and Utilities Board approval.  

Otherwise, ProEnergy has the right to pull out of the deal. That would leave N.B. Power back at square one in its procurement process, and facing higher costs and years-long delays, if the utility tries again to build a similar project.

N.B. Power has warned the gas plant is needed to prevent a power capacity shortage it predicts could come by winter 2028. In an email, utility spokesperson Elizabeth Fraser said the gas plant is the “most optimal solution,” to tackle the potential shortage.

“If we were to start over, ... it's likely we wouldn't be able to deliver a solution until 2031, leaving the potential for generation shortfalls between 2028-2032,” Fraser wrote.

Tantramar MLA Megan Mitton, whose riding is home to the proposed site for the gas plant, said she wants N.B. Power to consider other solutions. 

“I actually would like for this contract to fall through,” said Mitton. “And N.B. Power can pursue a different pathway– renewable energy and storage and energy efficiency–and really throw everything at that.”

Urquhart said the utility tried to negotiate a deadline extension with ProEnergy, but the company drove too hard a bargain, with commercial terms “not acceptable to N.B. Power.”

Urquhart said there’s an “urgent shortage” of combustion turbine engines like the ones ProEnergy plans to install and run in rural Tantramar. That means new projects could face “at least a 20 per cent increase in costs as compared to projects already in the production queue.”  He also warned that new projects could see a “lead time of approximately 5 to 6 years or more.”

“Economic leverage has shifted entirely to suppliers,” wrote Urquhart, “with project cancellations becoming opportunities to repurpose units at higher prices.”

The time crunch N.B. Power is currently facing is in part a result of one of its early decisions, said Mitton.