NB Power questioned over $1B in Point Lepreau costs1/11/2013
NB Power says the Energy and Utilities Board does not have the authority to question the "reasonableness" of bills it ran up during the Point Lepreau Nuclear Generating Stationís refurbishment because legislation passed by the former Liberal government shields those expenses from scrutiny.
"It is NB Power's position that [the Electricity Act] does deem these costs to be prudent and therefore because of those provisions removes the requirement of the Board to review these costs and expenses," said Darren Murphy, a vice-president at NB Power.
The EUB began several days of hearings on Thursday into two major Point Lepreau issues, including the expected lifespan of the rebuilt plant and the appropriateness of $1 billion worth of non-capital costs it accumulated in a deferral account during the refurbishment.
But Renť Basque, the public intervener, began asking about potential problems with that billion-dollar figure Murphy and John Furey, a NB Power lawyer, both maintained most questions were pointless, a position summarized by Raymond Gorman, the regulatorís chairman, as he refereed Basque's attempts to crack the issue.
"NB Power has taken the view that the board's task is not to look into the reasonableness [of the costs] but really to look into whether the legislation has been complied with," Gorman told Basque.
"So other than your assurance that these costs are prudent we have no way to know if these deferral costs are reasonable, do we," Basque asked Murphy, who simply referred the intervener back to the legislation.
Green Party Leader David Coon, who attended the hearing, said shielding Point Lepreauís expenses from scrutiny makes a mockery of hearings into those expenses and undermines the authority of the EUB.
"We continually see changes that remove power from the EUB despite promises they are going to increase the power of the EUB. So what's going on?Ē Coon said.
The EUB hearings are being held in Saint John to determine how NB Power will back the money in the $1-billion deferral account, which was accumulated while the nuclear reactor was being refurbished.
The public intervener has questioned NB Power's estimates for the refurbished reactor's lifespan and the amount of money that is in the deferral account.
NB Power has said the deferral account will be paid back over 27 years and it will have a minimal impact on power rates.
"NB Power is confident that the current 10-year forecast of modest two per cent rate increases is adequate to recover the balance in the deferral account," the utility said in a statement issued on Thursday.