NB Power, New Brunswick’s electricity company, plans to increase its rates by an average of 9.25% per year over the next two years.
To mitigate the impact of these increases on pulp and paper mills, the company will increase its subsidies to this sector by 36%, to reach 26.3 million dollars over two years.
This subsidy program, called the “Large Industrial Renewable Energy Purchase Program”, consists of buying renewable electricity produced by factories at a high price ($120.57 per megawatt hour) and reselling it to them at a low price ($73.13 $). This price difference will apply to approximately 265,610 megawatt hours of electricity this year.
However, NB Power says it is not allowed to offer similar assistance to other customers, including low-income households, due to restrictions in the Electricity Act. Brad Coady, vice-president of NB Power, explains that subsidizing one customer would involve increasing rates for others, which is not permitted by regulation.
This situation raises questions of equity, particularly regarding assistance for low-income tenants who face rising electricity costs. Unlike Ontario, which offers monthly rebates to low-income households, New Brunswick lacks similar assistance programs for renters.
NB Power acknowledges the existence of fuel poverty and the difficulties in reaching tenants, but says it follows government regulations in place regarding subsidies to pulp and paper mills.
