NB Power seeking to split 19.4% rate increase evenly over 2 years
N.B. Power is asking for permission to split its proposed 19.4 per cent rate increase equally over two years through a deferral account.
The utility says if the request isn't approved, customers would see an increase of 11.15 per cent in 2024-2025 and 5.59 per cent the year after.
The New Brunswick Energy and Utilities Board is holding hearings to determine whether N.B. Power should be allowed to raise its electricity rates by nearly 20 per cent over two years. It's also hearing testimony about how that rate increase should be rolled out.
The utility previously said it's raising rates to keep up with its $5.4 billion debt load. It's also spending billions on major infrastructure projects, including to refurbish the Mactaquac Dam.
On Monday, consultant John Todd said spreading the increase equally over two years maintains rate stability. He said the goal is partly to avoid "rate shock" that would be caused by an 11 per cent increase in one year.
Abigail Herrington, the lawyer representing the New Brunswick Energy and Utilities Board, asked Todd whether he would endorse a plan for a more gradual increase spread out over five years.
Todd said there is too much uncertainty to delay the increase that far in the future.
"The further out you push it, the more challenges could arise in the meantime, put it that way," he said. "You might get lucky but you might not."
No aid for low-income households
The board previously heard evidence about how electricity aid programs, like the rebates for people with low income in Ontario, are not something N.B. Power is allowed to provide in New Brunswick. The board heard that those restrictions do not apply to industrial customers.
N.B. Power previously outlined plans to spend $26.3 million over the next two years to help pulp-and-paper mills with their electricity costs.
Shelley Petit, speaking on behalf of the New Brunswick Coalition of Persons with Disabilities, said the increased rate could result in marginalized people getting disconnected because they're unable to pay their bill.
"I know that for my members, that $25 is going to mean disconnect. They can't afford their power bills now. They're going without food. They're going without medications," she said.
Todd said policies need to be implemented to address that issue but it isn't addressed in his report.
"There's a lot of material and practices elsewhere that you could build on, and this is something that's in collaboration discussion with New Brunswick Power, the government ... policy changes are always possible," he said.
N.B. Power was given permission by the utilities board to begin charging an increase of 9.25 per cent on April 1, but it will have to rebate a portion of what it has collected if the amount is found to be too high.
The utility previously said it needs to earn more than $1 billion in profit over five years to meet 2029 financial targets set by the Blaine Higgs government.
The hearings are expected to take 16 sitting days and they're scheduled to wrap up in August.
