NB Power does its best to project the costs of delivering electricity for the upcoming year. These forecasts are based on a number of factors including energy consumption, weather, commodity prices, exchange rates and hydro flows. Sometimes, due to factors outside of its control, variances can occur, resulting in additional revenue or losses.

Until now, NB Power had to absorb any variances, whether they were positive or negative. In recent years, NB Power has experienced primarily negative variances, which has become increasingly challenging for us.

Following changes to the Electricity Act in 2021, a new mechanism is in place to provide greater transparency to customers and help us ensure the actual costs of delivering electricity is recovered in rates.

Regulation now requires NB Power to file a Variance Account Recovery with the New Brunswick Energy and Utilities Board each fiscal year. If actual costs come in lower than anticipated, New Brunswickers can receive a reduction in rates. If actual costs come in higher than anticipated, New Brunswickers can receive an increase in rates.

On Dec. 15, 2022, NB Power filed with the Energy and Utilities Board for a reduction of costs to customers equivalent to 0.12 cents per kWh or an approximately 1 per cent rate reduction for the average residential customer.

This filing is separate from the rate request made as part of the General Rate Application in October 2022.

In March 2023, the New Brunswick Energy and Utilities Board issued its decision on the separate NB Power filings as part of the provincial regulatory process. In regards to a Variance Account Recovery ruling, which is about ensuring the actual costs of delivering electricity are covered in rates, customers will see a 0.9 per cent reduction.

Overall, this means that starting April 1, 2023, electricity rates will increase by a net 4.8 per cent in New Brunswick for the next 12 months.