New Brunswick Premier Shawn Graham, left, and Nova Scotia Premier Darrell Dexter announce a possible construction of a 500-megawatt power line between the two provinces. (CBC)

NB Power and Nova Scotia Power are exploring the possibility of building a new 500-megawatt transmission line connecting the two Maritime provinces.

New Brunswick Premier Shawn Graham and Nova Scotia Premier Darrell Dexter made the announcement of the proposed power route on Tuesday in Fredericton.

The two premiers said the line would allow the provinces to import and export more renewable energy, create jobs and open up the possibility of "hundreds of millions of dollars" of investment.

The proposed line would travel from Colchester County, N.S., to southeastern New Brunswick. There is currently a 300-megawatt connection between New Brunswick and Nova Scotia.

Graham said the new route would "more than double the capacity of the current connection between our two provinces."

Before the electricity route is constructed, an extensive approval process would need to be carried out.

Graham would not speculate on how long the regulatory process would take. But the New Brunswick premier said the construction phase would take two years after the regulatory approvals are awarded.

Dexter told the news conference that the added power connection would allow his province to meet an aggressive plan to have 25 per cent of its power generated by renewable energy by 2015.

"Historically, Nova Scotia was an energy island, and now, because of this project, the province will have a stronger grid that can import and export power," Dexter said.

"That means that more jobs will be created that will strengthen and grow the economy, and businesses and Nova Scotians from one end of the province to the other will have stable energy prices, which will result in more affordable power in the foreseeable future."

Nova Scotia Power announced in July that it wanted to build a 345-kilovolt power line, which would come with an estimated $200-million price tag, between Nova Scotia and New Brunswick.

As well, the New Brunswick System Operator, the independent agency that ensures the reliability of the province's transmission system, issued a report recently calling for improvements in the electricity transmission system in southeastern New Brunswick.

The report said studies were continuing on how to meet the current and future electricity transmission needs of the interconnections to Nova Scotia and Prince Edward Island.

New income

New Brunswick and Nova Scotia are exploring the possibility of building a 500-megawatt transmission line connecting the two provinces. (Canadian Press)The two power corporation executives would not estimate how much it might cost to build the power line, although they both pegged the cost at "hundreds of millions of dollars."

Along with opening up the region to new power import and export possibilities, Gaetan Thomas, the president and chief executive officer of NB Power, said the New Brunswick utility would stand to make money off of the proposed route.

"This would be increased revenue for NB Power on that portion of that line that we would end up building, so that's one revenue, the transmission tariff," Thomas said. "The other revenue is we are going to be in the business to actually compete to sell more power. We do have capacity and we will be able to benefit from extra exports as well."

N.L. opportunities

The additional transmission link could open up the possibility to wheel power through the region from the proposed Lower Churchill Falls project in Newfoundland and Labrador.

The N.L. government is hoping to develop the $6.5-billion Lower Churchill hydroelectric megaproject but it is looking for a way to transmit the power into hungry markets.

Nova Scotia's premier said this new power line could assist in any future negotiations with Newfoundland and Labrador.

"There are ongoing negotiations [with the N.L. government] but this puts you in a position to be able to facilitate that kind of eventual agreement," Dexter said.

"As with everything, it is about economics but if you don't put yourself in a position to do it, then you surely will not."

Regional co-operation

The premiers and utility executives were all boasting about the benefits of regional co-operation at the Tuesday news conference.

"We are taking a good relationship with our neighbour and making it even stronger," Dexter said.

However, the timing of the energy announcement and the looming Sept. 27 New Brunswick election could not be avoided.

Nova Scotia's premier said he is ready to work with whoever is the premier of New Brunswick after the September election.

"My job of course is to make sure we are promoting the kind of leadership that is necessary in the important energy sector. What we are doing today is providing that kind of leadership," Dexter said.

"Maritime economic co-operation has been talked about for a very long time, this lifts them off the pages of speeches and into action. I think that is good for New Brunswick and I think that is good for Nova Scotia."