Ed Barrett, the chairman of NB Power, said the utility will aim to cut its debt by $1 billion in the next decade. (CBC)

NB Power must reduce its debt by  $1 billion in the next 10 years, the Crown corporation's chairman told a legislative committee today.

Ed Barrett made the comment on Thursday afternoon during an appearance in front of the Standing Committee on Crown Corporations.

"Debt reduction has to be a priority," Barrett told the committee.

Barrett said NB Power would like to get to a position where the corporation has 20 per cent equity.

That would mean the utility needs to cut its debt by $1 billion in the next decade.

NB Power’s debt was pegged at $4.532 billion when the corporation issued its third quarter financial results last month.

Nuclear deferral account

The utility's finances were a reoccuring subject at the committee hearing.

Bathurst Liberal MLA Brian Kenny asked the utility to explain the financial situation at the Point Lepreau Nuclear Generating Station.

The NB Power officials explained the project's deferral account, which covers replacement fuel costs and expenses for operating the reactor, will hit $1 billion.

Before the delays at the refurbishment project, the deferral account was expected to be $400 million.

The nuclear reactor is scheduled to start up again in September. The refurbishment is three years behind schedule.

The main reason for the reactor’s delay has been the installation of the reactor’s calandria tubes.

All 380 new tubes were inserted in the reactor between December 2009 and April 2010. But dozens of the tubes failed air tightness tests after being fused with special inserts designed to hold them in place.

The tubes, which are about six metres long and 13 centimetres in diameter, contain the reactor's fuel channels and fuel bundles.

The calandria tubes were the first major pieces of equipment to be installed in the reactor as part of the refurbishment.