New Brunswick energy regulator cancels Holt government fuel price cuts

Gasoline and diesel price cuts of up to 10 cents per litre that were scheduled to take effect across New Brunswick on Monday have been cancelled by the province's Energy and Utilities Board.

In a decision released Friday afternoon, the board found that a decision made by Premier Susan Holt's government to eliminate refinery environmental charges from fuel prices starting next week threatened significant damage to both petroleum wholesalers and retailers.  

The charges to be cancelled, known as a "carbon cost adjuster," allow refineries and fuel importers to pass the cost of tightening federal environmental rules on through to consumers.

In its ruling, the board ordered the implementation of a new fuel charge equal to the charge being cancelled. The two will change places simultaneously at one minute past midnight on Dec. 1.

"The arithmetic result of removing the current value of the carbon cost adjuster ... demonstrates a deleterious impact on the wholesalers and retailers," said board chair Christopher Stewart in the oral decision.

In an emailed statement sent to CBC News Friday, New Brunswick Premier Susan Holt wrote that she would " continue pressing for a system based on actual costs. Families are struggling, and they should not be paying a penny more for fuel than necessary."

She went on to write that she was "frustrated" with the EUB's decision and said it is their job to ensure the lowest price possible for consumers.

"The carbon adjustor remains unsupported by evidence and consumers should not be forced to absorb costs the industry cannot prove," Holt wrote.

Holt began calling for the removal of the carbon cost adjuster in 2023 while she was opposition leader. She argued oil companies should pay for their own environmental costs and pledged in the 2024 provincial election to have the amount removed from New Brunswick's regulated pricing formula for gasoline and diesel.

On Friday the adjuster was adding up to 7.9 cents to gasoline prices and 8.8 cents to diesel, plus HST.

Holt announced on Oct. 30 that the charges would be eliminated on Dec. 1 and later told the legislature she expected consumers to save $84 million per year in fuel costs because of the government action.

"We’re directing that $84 million in savings to New Brunswickers, with a gas price that is going to be eight cents lower on Dec. 1," she said.

However, in eliminating the charge to consumers, the government made no changes in legislation to prevent those same refinery environmental costs being passed through to retailers. The prospect of $84 million in costs suddenly falling on that group led the board to intervene.

"The void left by the coming into force of the repealing statute is a relevant consideration because wholesalers and retailers will bear the cost ... of compliance," the board ruled.