NB Power doesn't want to 'burden' ratepayers in solving $4.9B debt problem: CEO

Lori Clark appointed as president, CEO of NB Power Todd Battis speaks with Lori Clark, newly appointed president and CEO of NB Power, about her priorities for the company moving forward.

The newly-appointed president and CEO of NB Power says the “last thing” the utility wants to do is put its enormous debt on the backs of ratepayers -- as it seeks a rate increase.

Lori Clark says while rate increases are “on the horizon,” there are other avenues the utility can look toward to pay down its roughly $4.9 billion in total debt.

She says the utility recently released a request for proposals in the sale of its downtown Fredericton head office, as well as another building it owns next door at 527 King St.

“We are in the business of generating, transmitting and distributing electricity and not necessarily in the building management business, so there may be others that can do it better,” Clark said in a recent interview with CTV News.

She says the utility is also working with PricewaterhouseCoopers (PwC) – a global consulting firm – on a cost-optimization review and will look at implementing the ideas the firm comes up with.

Clark, who is the former senior vice president of operations, was brought in after NB Power fired her predecessor, Keith Cronkhite, last July, in a move it says was motivated by a need for “significant transformation” due to the energy crisis and excessive debt.

“The utility does have a large debt on its balance sheet, rates are only one way of dealing with that,” said Clark.

“We know there are likely to be rate increases, but we certainly don’t want to burden our customers with rate increases anymore than they have to be.”

The higher costs faced by ratepayers, brought on by inflation, are the same things facing the utility, said Clark.

NB Power sought an 8.9 per cent rate increase across all customer classes based on a revenue requirement of about $2.3 billion. The utility wanted new rates to come into effect by April 1.

But in a partial decision released Thursday, the New Brunswick Energy and Utilities Board said it was “not satisfied that the rates, as applied for, are just and reasonable.”

“NB Power is directed to update its fuel and purchase power expense, load forecast, and revenue forecast,” the board said in its decision. It noted various other updates that also need to be made.

The utility now has to refile its 2023/2024 test year budget with several adjustments before the utility board will approve a rate increase.

Clark says NB Power -- a Crown Corporation -- knows it has to be as cost-effective as possible.

“The last thing we want to do is put this on the backs of our customers,” said Clark.