Lepreau cost overrun could mean lawsuit
A fight over compensation for cost overruns at the Point Lepreau nuclear plant could be heading to court.
The refurbishment of Lepreau is 16 months behind schedule, which could cost New Brunswickers an extra power-rate increase.
The contractor, Atomic Energy of Canada Ltd., has admitted the original deadline it agreed to was never realistic. So the province says AECL's owner — the federal government — should compensate the province beyond the terms of the contract.
'There's a variety of options. Certainly that's one of them that we'll take a look at.'—Energy Minister Jack Keir
Conservative Saint John MP Rodney Weston, however, said Ottawa will pay only what's required in the contract, nothing more.
If that's not good enough for the province, it should sue, he suggested.
"NB Power should take the necessary steps to force their partner, AECL — it has been described as a partnership — they should take the necessary steps to ensure they hold up their end of the agreement."
"What I suggest is that there's a variety of options," he said. "Certainly that's one of them that we'll take a look at."
Hiring lawyers could be expensive and time-consuming, but it's one way to get Ottawa to the negotiating table, he added.
NB Power has estimated that replacement fuel for each day the nuclear reactor is not running costs it $1 million.
Last week, NB Power president David Hay said rates could increase by roughly two per cent because of the reactor delays.
The refurbishment was originally estimated to cost $1.4 billion, and was supposed to be completed by the end of September. AECL has said it will be early 2011 before the reactor is back online.
A leading researcher at the University of Moncton, Yves Gagnon, predicts the cost overruns in overhauling the nuclear plant will top $1.6 billion.
Point Lepreau is Atlantic Canada's only nuclear reactor. This is the first refurbishment of a Candu-6 ever attempted by AECL and was intended to be used as a model for the federal Crown corporation to show off to other countries that own similar reactor models.