EUB will consider NB Power request to drop controversial 'weather tax'

The Energy and Utilities Board says it will consider NB Power's request to abandon its so called "weather tax' proposal Monday morning but it wants more information from the utility about why it suddenly soured on the idea.

Utility announced Friday it is seeking permission from the regulator to withdraw its application

NB Power president and CEO Gaëtan Thomas said the utility made the decision to withdraw the application after hearing from its shareholders and customers 'who are anxious abut the impact.' (CBC)

The Energy and Utilities Board says it will consider NB Power's request to abandon its so-called weather-tax proposal Monday morning but it wants more information from the utility about why it suddenly soured on the idea.

"NB Power should file a notice of motion and any supporting documents in support of this request," the board wrote to NB Power on Friday afternoon.

After vigorously defending the advantages of storm damage surcharges in front of the board as late as Tuesday, NB Power is scrambling to kill the plan after Premier Brian Gallant wrote the utility to say he hated it.

"I am strongly opposed to the idea of a 'weather tax' and would consider overruling the adjustment … should it be supported by the EUB," Gallant wrote in a letter to NB Power President Gaëtan Thomas on Wednesday.

The letter was leaked to a number of news outlets simultaneously on Thursday and by Friday morning following a quick meeting of its board of directors, NB Power was asking the EUB for permission to retract the idea.

"The NB Power board of directors has directed management to seek leave of the board to withdraw the adjustment mechanism request at this time," NB Power's chief legal officer Wanda Harrison wrote in an official request letter.

But that may be more complicated than it sounds.

Letter 'ill-advised'

Because the utility has filed evidence at its rate hearing in support of storm surcharges and two senior executives have staunchly defended the merits under questioning, the EUB is not necessarily obliged to agree to the about-face, according to a former senior EUB member.

"That's an uncertain question," said Moncton lawyer and businessman Cyril Johnston, who left the EUB in 2014 after seven years as its vice-chair.

NB Power has said the cost of restorations following the January 2017 ice storm was an estimated $30 million, making it the largest and most expensive in the corporation's history. (Jerome Luc Paulin/Twitter)

"The fact that it was in the original application and that evidence has been filed and the matter has been considered would give the board more right to [reject the withdrawal request] than if it had never been brought forward at all."

Johnston called Gallant's letter to NB Power "ill advised," given the EUB was in the middle of hearing the storm surcharge issue and the tribunal is meant to be free from outside political influence in its deliberations.

"It has to be seen as being independent and at arms length from the government," said Johnston.

"It seems to be a misunderstanding of the role of the regulator to send out a letter like this."

'Bone-headed idea'

But Green Party Leader David Coon, a longtime defender of the independence of the EUB, disagreed that Gallant acted improperly.

"I don't have any problem with him writing that letter," Coon said.

"It's the most bone-headed proposal I've heard from them [NB Power] in years. It's no wonder the premier wrote to them suggesting this was a bad idea."

At least twice in the last year, the Gallant government has lectured opposition politicians in the legislature on the importance of government not interfering with the operation of NB Power.

'We do not meddle'

Last December, Energy Minister Rick Doucet denied a suggestion from Opposition Leader Blaine Higgs that he played a role in having NB Power install an electric car charging station in Charlotte County.

"We do not meddle in the day-to-day operations," Doucet said. "The utility can take care of its own situation and its own issues."

The government has known since last October that NB Power would be pursuing a way to charge customers directly for extraordinary storm damage expenses by adding some kind of a surcharge to bills.

No ministers, including the premier, expressed any concern about the idea, even when it was raised directly in question period six weeks ago.

On Tuesday, the utility was still pushing hard for approval of storm surcharges, with senior NB Power vice-presidents Darren Murphy and Lori Clark both testifying at the EUB in favour of their adoption.

Monday morning it will try to make the opposite point.

About the Author

Robert Jones

Reporter

Robert Jones has been a reporter and producer with CBC New Brunswick since 1990. His investigative reports on petroleum pricing in New Brunswick won several regional and national awards and led to the adoption of price regulation in 2006.

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