NB Power files General Rate Application and Variance Account Recovery with EUB
FREDERICTON - Today, NB Power filed with the New Brunswick Energy and Utilities Board (EUB) two separate filings related to rate pricing that, if approved, could see electricity rates increase. The filings included a General Rate Application asking for a 9.8 per cent increase to residential rates, as well as a Variance Account Recovery filing asking for a three per cent increase over 12 months. If approved, the average residential electricity bill would increase by $18.72/month next year, and the variance account recovery for average residential customers would increase by $5.81/month for 12 months.
“We understand that raising rates is not something anyone wants, particularly when customers are already paying more for their everyday needs like housing, gas and groceries,” said Lori Clark, president and CEO of NB Power. “However, to continue to provide the reliable electricity customers need in the face of unprecedented challenges and change, an increase in rates is required to meet customer demand and prepare for the future. This is not business as usual.”
The utility filed a two-year General Rate Application to provide New Brunswickers with as much predictability as possible in the years to come. The application is based on the projection of costs for the 2024/25 and 2025/26 budget years. If approved, residential customers will see a 9.8 per cent increase in year one and a second 9.8 per cent increase in year two.
Around the world and at home, energy utilities are facing a multitude of challenges that are resulting in a tremendous degree of transformation in the electricity sector overall, ranging from climate change and new government regulations focused on achieving net-zero energy production, to evolving customer demands and expectations. The specific challenges that led NB Power, which is a cost-of-service utility, to make a rate increase request this year include inflation and market prices, needed improvements in reliability and performance at the Point Lepreau Nuclear Generating Station, the need to improve financial health and a reduction in energy sales outside of New Brunswick.
NB Power also submitted its annual Variance Account Recovery filing as required by the Electricity Act. This represents a calculation of actual reasonably incurred costs and revenues versus what was projected, and is based on the balance of the account as of a particular date. For this particular filing, actual costs came in higher than anticipated due to a number of factors, primarily an unplanned outage at the Point Lepreau Nuclear Generating Station. As a result, based on the account balance, this filing asks to apply a three per cent rate increase over 12 months. Last year, customers received a 0.9 per cent rebate for 12 months.
Right now, New Brunswickers are paying the lowest residential electricity rate in Atlantic Canada. Even with the potential rate increase, N.B. will still have a lower rate than Nova Scotia and Prince Edward Island and will remain among the lowest in Eastern Canada and the U.S.
The proposed rate increase will directly benefit all customers in a number of ways. NB Power’s planned investments in infrastructure and generating station reliability as well as cost-effective energy sources will provide increased energy security now and into the future. A stronger investment in energy efficiency will help New Brunswickers manage their energy usage. With increased spending identified for outage prevention and response and the continued mass deployment of smart meters, customers will continue to enjoy a reliable energy supply. NB Power will also improve its customer care to offer a better customer experience.
“We are leaving no stone unturned as we look at every aspect of our operations and make the necessary changes to manage our costs and improve our financial situation, build equity and keep rates as low as possible for New Brunswickers,” said Clark. “In the last year, NB Power cut approximately $50 million from its operations and there will be more sustained cost reductions this year. However, it will not be enough to offset the rising cost of producing energy to meet the needs of New Brunswickers. The decision made by the New Brunswick Energy and Utilities Board on today’s two filings related to rate pricing will greatly impact our ability to respond to the utility’s needs of today and prepare for the future.”
Both applications will go through independent, rigorous review processes by the EUB, giving customers and others an opportunity to offer feedback. The timeline for hearings and subsequent decisions and implementation timelines for both matters will be determined by the EUB after the filing is made. The potential new rate would come into effect no earlier than April 1, 2024.
NB Power offers many programs to help New Brunswickers manage their energy use and costs by making their homes and businesses more energy efficient. Find more information at saveenergynb.ca.
MEDIA CONTACT: Dominique Couture at 506-377-8057 or email@example.com.