New Brunswick’s auditor general has revealed the true price of NB Power’s controversial gas plant project in the southeast of the province – it’s expected to cost people paying their electricity bills more than $2.8 billion, nearly triple what the public utility has suggested up till recently.
The so-called Renewable Integration and Grid Security project, or RIGS, a venture with the American firm ProEnergy, received the green light from the provincial regulator just two weeks ago.
NB Power had argued that it could not reveal all the financial details because it had to protect ProEnergy’s commercial interests. The public utility routinely said the deal would cost over $1 billion.
This means NB Power’s 430,000 direct and indirect customers didn’t know how much they were paying, even though they must foot the cost of the secret tolling agreement over 25 years.
The regulator and the public intervenor for the energy sector, appointed by the provincial government, were privy to the details but were sworn to secrecy not to share them. The auditor general examined the contract and decided to release the global figure anyway.
It works out to $6,500 on average per customer. Auditor general Paul Martin took a dim view of how NB Power rolled out the agreement.
In a report released last week, he said the utility’s executives made critical choices without addressing significant financial and contractual risks.
ProEnergy will build, own and operate the 400-megawatt plant on behalf of NB Power, according to a 25-year deal, subject to environmental approvals.
Among his findings, Martin said NB Power only completed an analysis of alternatives to a gas plant after the deal with RIGS was signed. No supplier quotes were obtained to justify management’s assumption that it couldn’t build the project itself in an ownership model that would cost up to $700 million less than that of the business partnership.
Additionally, an Indigenous equity partnership was not established, as required, and there was no backup plan if the regulator had denied or delayed the project.
The report noted that the penalty would have been a $55-million charge to NB Power, paid to ProEnergy, if the project had been scuttled, a huge risk to the utility’s customers, who were largely in the dark about the details.
Speaking to reporters after delivering the report at the legislature to an all-party committee, Martin said the project lacked “good checks and balances.
“I’m not seeing sufficient documentation for a $2.8-billion cost that I would expect in this process. And I think they need to be accountable for that.”
NB Power has said it was under intense pressure to quickly come up with more electrical production because of an explosion in population growth following the COVID pandemic.
The populaton has grown from 782,000 in early 2020 to 867,000 in early 2026, an increase of 11 per cent.
NB Power CEO Lori Clark warned the auditor in a letter of April 17, which was made available in his report.
She said by early 2024, NB Power faced a high risk of winter peak shortfall driven by higher-than forecast demand for electricity, increased electrification, exposure to extreme cold-weather events and breakdowns of its generators, including the Point Lepreau Nuclear Generating Station.
“These risks were not abstract,” Clark said. “During the February 2023 extreme cold-weather event, New Brunswick experienced record winter peak demand and operated close to the threshold at which customer outages could have occurred. Absent timely action, NB Power faced a credible risk of customer outages during extreme winter peak conditions.”
She said at the same time, markets for new dispatchable generators across North America were highly constrained, making it hard to get the right equipment.
“In this environment, delayed action created the risk of service interruptions during periods when electricity is most critical for public safety and economic activity. I personally have had conversations with CEOs of neighboring utilities who are envious of our foresight in procuring this arrangement including its favourable terms and pricing.”
The auditor responded to Clark by writing in his report that the central issue wasn’t whether NB Power faced a legitimate need for more electrical production, but whether it properly considered several alternatives, such as large batteries or wood pellets, and was careful to prove its case for a gas combustion turbine project.
He said if NB Power had decided to own the plant, instead of forming a partnership with a business, the costs could have been $425 million to $700 million lower.
NB Power has always said it didn’t want the uncertainty of building and owning such a plant, pointing to big projects it had run with cost overruns in the past. The utility also touted ProEnergy’s expertise in the field and its reputation for delivering good projects. But Martin said NB Power didn’t provide any supporting evidence that it had thoroughly examined different business models.
In a prepared statement, both Clark and the chairman of the board of NB Power, Andrew MacGillivray, said the project was subject to oversight by the Crown corporation’s senior leadership and the board of directors. NB Power also sought direction from the New Brunswick Energy and Utilities Board, or EUB, before the agreement became binding, they said.
“The report examines complex decisions made during a period of heightened system risk,” they said. “At the time, NB Power was facing increasing pressure on the system, including the potential for winter peak shortfalls during extreme weather conditions. Maintaining safe, reliable service for New Brunswickers – especially during critical periods – was the primary priority.”
A spokesperson declined an interview request for Clark.
Kris Austin, the energy critic for the Official Opposition, said it was frustrating to see the auditor come up with findings that should have given the regulator pause.
“The bigger picture is NB Power is up against the wall,” the Progressive Conservative MLA told reporters, referring to an expected shortfall in electrical production by 2028. “They know they’re up against it. It amazes me that no one had the foresight, years ago, to look ahead. You want to electrify our society with vehicles and other sorts of things, you have to the energy available to do that and the grid to sustain it. It doesn’t seem either of them were done properly.”
The plant will be built in Megan Mitton’s riding, infuriating the Green opposition politician. She, like others on the public accounts committee, demanded that Clark and other senior NB Power executives appear before them to answer tough questions.
Her appearance is expected Thursday morning.
“It’s almost $3 billion and a 25-year commitment,” she told reporters. “We need to be looking at the context of the cost for New Brunswickers, the health of New Brunswickers, the climate crisis, and definitely having a longer-term vision for what they’re signing us up for, which is a multibillion dollar, multi-decade, gas and diesel plant with unpredictable fuel costs coming down the line that risks our health and our water.”
In question period, a Liberal cabinet minister defended the RIGS deal.
Keith Chiasson, the minister of Indigenous Affairs, said the plant would add more electricity to the grid and provide backup power to clean wind energy.
“Nova Scotia is actually gonna piggyback on the RIGS project,” he said. “They want 100 megawatts. They’re actually looking to put their own RIGS project in place, so is PEI. So, you know, as a province, when we’re looking at these projects, who do we rely on as oversight and to make sure that the project is cost effective? The EUB.”
Opponents of the project said the report provided more evidence the RIGS project was deeply flawed.
“The Auditor General has confirmed what our coalition has argued from the beginning: this project was pushed through without proper process, proper planning, or proper accountability,” said Lisa Griffin, a spokesperson for the Protect the Chignecto Isthmus Coalition, in a prepared statement.
“This is a Crown corporation that committed ratepayers to a generation-long contract before regulators had even ruled on whether the project should proceed. That is not how public infrastructure decisions are supposed to work in this province.”
The timing of the report’s release will no doubt raise questions. People who live in Tantramar, especially in Centre Village where the 400-megawatt plant will be built by 2028, pushed hard to stop the project, arguing it would pollute the atmosphere with dangerous greenhouse gases and contaminate their water.
But the New Brunswick Energy and Utilities Board approved the project on May 28, only 17 days after the auditor said his work on the RIGS project had concluded.
Martin, however, said he didn’t think it made a difference, given that most of what he reported was publicly available and that the board had thoroughly examined hundreds of documents on file.
He said he nonetheless thought it was important to quickly distill the most important information for people paying NB Power bills and the provincial government, which is the Crown corporation’s sole shareholder and provides it direction.
By John Chilibeck, Local Journalism Initiative Reporter
Original Published on Jun 10, 2026 at 12:56
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