New Brunswick electricity costs continue to escalate out of control
The following statement has been released in response to today’s decision by the New Brunswick Energy and Utilities board:
Saint John, NB – J.D. Irving, Limited is very disappointed in today’s decision by the New Brunswick Energy and Utilities Board. This decision will see all electricity rate payers in the province pay an additional 20-25 per cent in electricity costs over the next two years.
As a large consumer of electricity in our manufacturing operations, this makes an uncompetitive rate even worse. The largest electricity consumer in the province, Irving Paper, currently pays rates that are 22 per cent higher than the average of the Canadian industrial rate. After these rates are implemented, Irving Paper will pay over 30 per cent more.
“NB Power’s projected rates represent a 50 per cent increase in electricity costs over a five-year period,” said Mark Mosher, Vice President of Pulp & Paper, J.D. Irving, Limited. “No business can absorb such increases without negative impacts.”
The issues underlying high electricity costs in New Brunswick have been long term and are well known. The Point Lepreau Nuclear Generating Station, responsible for supplying approximately 40 per cent of New Brunswick’s electricity during normal operation, has operated in the bottom 25 per cent of nuclear stations in North America since 2018. Its current unplanned outage means that, even in the best-case scenario, it will only operate for 30 per cent of this year. This, combined with unexpected equipment failures at Bayside Power and Belledune Generating Station, exceptionally high debt levels and an overreliance on imported energy has exposed ratepayers in this province to unprecedented electricity rates.
Irving Paper has shut down 50 per cent of its operation in response to NB Power’s record high industrial electricity rates. It has been down for over 12 days in October and may remain down until NB Power’s plants can effectively return to operation. Irving Paper manufactures 400,000 tonnes of paper annually, over 95 per cent of which is exported to 65 countries. Current electricity rates have a massive impact on Irving Paper’s ability to compete.
Other provinces, including Ontario and Quebec, have invested in programs designed to retain and attract energy intensive manufacturing.
“We have invested significantly into making our facilities as energy efficient as possible in an effort to offset the province’s high electricity costs,” Mosher added. “Without a clear policy to address these bigger structural competitive issues, like has been done in both Ontario and Quebec, New Brunswick’s industrial base will continue to contract and New Brunswick won’t be able to attract new investment.”
Located at 435 Bayside Drive in Saint John, Irving Paper is a world class manufacturer of graphic paper for use in magazines, catalogs, newspapers and advertising flyers. It employs 310 direct and over 700 indirect jobs through its value chain (wood harvesters, truck drivers, etc.) and supports over 300 suppliers in New Brunswick, with a total of $144 Million in purchases in 40 communities in 2023. It is also a major consumer of wood chips from New Brunswick sawmills which are supplied, in part, by local private woodlots and marketing boards.
CONTACT:
Brendan Langille, J.D. Irving, Limited, 271-2107