New Brunswick’s nuclear-powered rate hikes

The abject failure of this and previous governments’ energy policies is on full display these days. In the 1970s, New Brunswick was one of only three provinces that bought into the federal government’s agenda to build out a civilian nuclear power industry. Quebec has since shut its nuclear generators down, leaving only Ontario and New Brunswick as the nuclear flag-bearers. How has that worked out for us?

NB Power has come to the Energy and Utilities Board (EUB) with a request for the biggest rate hikes in the utility’s history. While the details are buried in thousands of pages of documents filed with the EUB, evidence from previous EUB hearings makes it crystal clear that the utility’s single greatest financial liability driving up power rates is the much-vaunted Point Lepreau Nuclear Generating Station.

Point Lepreau has been a financial white elephant since its construction ended up costing three times the original price tag. Its planned 30-year lifespan (over which all this extra cost was to be amortized) was cut short by premature aging of critical reactor components, prompting a decision to undergo an expensive refurbishment, which was to extend the life of the plant by a fantastical 40 years. At the time, the then-PUB determined based on the evidence that refurbishment was too big a financial risk for New Brunswickers to handle and recommended against it. The Lord government went ahead anyway.

Like the original construction, the refurbishment went way over the timeline and budget. The result has been very poor performance, a miserable 60 per cent in 2022 compared to the wildly optimistic 90 per cent capacity assumption that the EUB rejected. The costs of replacement power alone during these shutdowns have repeatedly sabotaged annual financial performance projections. Now, Point Lepreau is facing even more expensive upgrades to fix problems that were not dealt with during the refurbishment.

In short, Point Lepreau is the most unreliable and most expensive power generator on the grid, responsible for the lion’s share of NB Power’s debt. It is not going to get any better. Keeping it afloat until 2040, its new end-of-life target, is going to mean more of the same – throwing scarce money down a deep, black hole paid for by ever-rising power rates.

Despite the overwhelming evidence that New Brunswickers cannot afford nuclear power, the Higgs government has doubled down on nuclear, floating an equally fantastical proposition that the next generation of nukes – so-called small modular reactors – will quarterback New Brunswick’s climate change strategy, while an SMR export industry is expected to drive economic growth. To that end, New Brunswick taxpayers have already fronted a total of $35 million to two private nuclear upstarts, neither of which has designed or built a reactor. This is despite lots of reasons to put their rosy promises of “clean” nuclear-fueled prosperity in the same wishful thinking category as JOI Scientific’s power-from-water scheme that so beguiled NB Power executives.

Just as the EUB rate hearings got underway, an entirely predictable hitch in the Higgs’ nuclear dream occurred. It seems like the SMR upstart ARC Clean Energy is on its way down and out, taking $25 million provincial dollars and $7 million federal with it. If we’re lucky, Moltex Energy, propped up by $10 million in provincial and $50.5 million in federal tax dollars, will be close behind, and we can breathe a sigh of financial relief. The longer this nonsense persists, the more of our tax dollars will go into the nuclear black hole, and the greater the delay in meeting our climate change pollution targets.

Even if Moltex hangs on, or some other SMR promoter replaces them, any electricity that might eventually flow from an SMR will be, like Point Lepreau, the most expensive power on the grid – entirely unaffordable and unnecessary. The Higgs government knows this, passing legislation this spring requiring NB Power to buy electricity from the planned privately-owned SMRs regardless of price, a silent admission that electricity from SMRs, should they ever see the light of day, will be more expensive than any alternative. In other words, SMRs will drive up your power bill.

Meanwhile, the June 22nd issue of The Economist features the exponential growth of solar energy worldwide, the cost of which – even with storage – is falling exponentially. Other than home retrofits, this is the cheapest new power on offer.

The nuclear cost numbers are there for all to see. For elected representatives to support this industry, knowing people cannot tolerate higher power rates, is grossly irresponsible and a betrayal of trust. Renewables naysayers are depriving New Brunswickers of the benefits of this global energy transition. This – and our nuclear-powered rate hikes – need to be on the ballot on October 21.

Janice Harvey is the chair of the Environment and Society program at St. Thomas University.