Wyoming business leaders ponder energy future

NB Power Pulp and Paper Subsidies lower electricity rates for six New Brunswick mills using firm power benchmarks and interruptible discounts, while government mandates, utility debt, ratepayer impacts, and competitiveness pressures shape provincial energy policy.

Key Points

Provincial mandates that buy down firm electricity rates for six mills to a national average, despite NB Power's debt.

✅ Mandated buy-down to match national firm electricity rates

✅ Ignores large non-firm interruptible power discounts

✅ Raises equity concerns amid NB Power debt and rate pressure

An effort to fix NB Power's struggling finances that is supposed to involve a look at "all options" will not include a review of the policy that requires the utility to subsidize electricity prices for six New Brunswick pulp and paper mills, according to the Department of Natural Resources and Energy Development.

The program is meant "to enable New Brunswick's pulp and paper companies have access to competitive priced electricity,"  said the department's communications officer Nick Brown in an email Monday 

"Keeping our large industries competitive with other Canadian jurisdictions, amid Nova Scotia rate hike opposition debates elsewhere, is important," he wrote, knocking down the idea the subsidy program might be scrutinized for shortcomings like other NB Power expenses.

Figures released last week show NB Power paid out $9.7 million in rate subsidies to the mills under the program in the fiscal year ended in March 2021, even though the utility was losing $4 million for the year and falling deeper into debt, amid separate concerns about old meter issues affecting households.

Subsidies went to three mills owned by J.D. Irving Ltd. including two in Saint John and one in Lake Utopia, two owned by the AV group in Nackawic and Atholville and the Twin Rivers pulp mill in Edmundston.

The New Brunswick government has made NB Power subsidize pulp and paper mills like Twin Rivers Paper Company since 2012, and is requiring the program to continue despite financial problems at the utility. (CBC)
It was NB Power's second year in a row of financial losses, while it is supposed to pay down $500 million of its $4.9 billion debt load in the next five years to prepare for the refurbishment of the Mactaquac dam, a burden comparable to customers in Newfoundland paying for Muskrat Falls elsewhere under separate policies, under a directive issued by the province

NB Power president Keith Cronkhite said he was "very disappointed" with debt increasing last year instead of  falling and senior vice president and chief financial officer Darren Murphy said everything would be under the microscope this year to turn the utility's finances around.  

"We need to do better," said Murphy on Thursday

"We need to step back and make sure we're considering all options, including approaches like Newfoundland's ratepayer shield agreement on megaproject overruns, to achieve that objective because the objective is quickly closing in on us."

However, reviewing the subsidy program for the six pulp and paper mills is apparently off limits.

The subsidy program requires NB Power to buy down the cost of "firm" electricity bought by pulp and paper mills to a national average that is calculated by the Department of Natural Resources and Energy Development.

Last year the province declared the price mills in New Brunswick pay to be an average of  7.536 cents per kilowatt hour (kwh).  It is higher than rates in five other provinces that have mills, which the province points to as justification for the subsidies, even as Nova Scotia's 14% rate hike approval highlights broader upward pressure, although the true significance of that difference is not entirely clear.

In British Columbia, the large forest products company Paper Excellence operates five pulp and paper mills which are charged 17.2 per cent less for firm electricity than the six mills in New Brunswick.

The Paper Excellence Paper Mill in Port Alberni, B.C. pays lower electricity prices than mills in New Brunswick, a benefit largely offset by higher property taxes. It's a factor New Brunswick does not count in calculating subsidies NB Power must pay. (Paper Excellence)
However, local property taxes on the five BC mills are a combined $7.8 million higher than the six New Brunswick plants, negating much of that difference.

The province's subsidy formula does not account for differences like that or for the fact New Brunswick mills buy a high percentage of their electricity at cheap non-firm prices.

Not counting the subsidies, NB Power already sells high volumes of what it calls interruptible and surplus power to industry at deep discounts on the understanding it can be cut off and redeployed elsewhere on short notice when needed.

Actual interruptions in service are rare.  Last year there were none, but NB Power sold 837 million kilowatt hours of the discounted power to industry at an average price of 4.9 cents per kwh.   

NB Power does not disclose how much of the $22 million or more in savings went to the six mills, but the price was 35 per cent below NB Power's posted rate for the plants and rivaled firm prices big mills receive anywhere in Canada, including Quebec.

Asked why the subsidy program ignores large amounts of discounted interruptible power used by New Brunswick mills in making comparisons between provinces, Brown said regulations governing the program require a comparison of firm prices only.

"The New Brunswick average rate is based on NB Power's published large industrial rate for firm energy, as required by the Electricity from Renewable Resources regulation," he wrote.

The subsidy program itself was imposed on NB Power by the province in 2012 to aid companies suffering after years of poor markets for forest products following the 2008 financial collapse and recession.  

Providing subsidies has cost NB Power $100 million so far and has continued even as markets for pulp products improved significantly and NB Power's own finances worsened.

Report warned against subsidies
NB Power has never directly criticized the program, but in a matter currently in front the of the New Brunswick Energy and Utilities Board looking at how NB Power might restructure its rates, including proposals such as seasonal rates that could prompt backlash, an independent consultant hired by the utility suggested rate subsidies to large export oriented manufacturing facilities, like pulp and paper mills, is generally a poor idea.

"We do not recommend offering subsidies to exporters," says the report by Christensen Associates Energy Consulting of Madison, Wis.

"There are two serious economic problems with subsidizing exports. The first is that the benefits may be less than the costs. The second problem is that subsidies tend to last forever, even if the circumstances that initially justified the subsidies have disappeared."

The Christensen report did not directly assess the merits of the current subsidy for pulp and paper mills but it addressed the issue because it said in the design of new rates "one NB Power business customer has raised the possibility that their electricity-intensive business ought to be granted subsidies because of the potential to generate extra benefits for the Province through increases in their exports"

That, said Christensen, rarely benefits the public.

"The direct costs of the subsidies are the subsidies themselves, a part of which ends up in the pockets of out-of-province consumers of the exported goods," said the report.  

"But there are also indirect costs due to the fact that the subsidies are financed through higher electricity prices, which means that other electricity customers have less money to spend on services provided by local businesses, thus putting a drag on the local economy."

The province does not agree.

Asked whether it has any studies or cost-benefit reviews that show the subsidy program is a net benefit to New Brunswick, the department cited none but maintained it is an important initiative, even as elsewhere governments have offered electricity bill credit relief to ratepayers.

"The program was designed to give large industrial businesses the ability to compete on a level energy field," wrote Brown.
 

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Offshore Wind Cost Competitiveness is rising as larger turbines boost megawatt output, cut LCOE, and trim maintenance and installation time, enabling projects in New England to rival natural gas pricing while scaling reliably.

Key Points

It describes how larger offshore turbines lower LCOE and O&M, making U.S. projects price competitive with natural gas.

✅ Larger turbines boost MW output and reduce LCOE.

✅ Lower O&M and faster installation cut lifecycle costs.

✅ Competes with gas in New England bids, per BNEF.

Massive offshore wind turbines keep getting bigger, as projects like the biggest UK offshore wind farm come online, and that’s helping make the power cheaper — to the point where developers say new projects in U.S. waters can compete with natural gas.

The price “is going to be a real eye-opener,” said Bryan Martin, chairman of Deepwater Wind LLC, which won an auction in May to build a 400-megawatt wind farm southeast of Rhode Island.

Deepwater built the only U.S. offshore wind farm, a 30-megawatt project that was completed south of Block Island in 2016. The company’s bid was selected by Rhode Island the same day that Massachusetts picked Vineyard Wind to build an 800-megawatt wind farm in the same area, while international investors such as Japanese utilities in UK projects signal growing confidence.

#google#

Bigger turbines that make more electricity have cut the cost per megawatt by about half, a trend aided by higher-than-expected wind potential in many markets, said Tom Harries, a wind analyst at Bloomberg New Energy Finance. That also reduces maintenance expenses and installation time. All of this is helping offshore wind vie with conventional power plants.

“You could not build a thermal gas plant in New England for the price of the wind bids in Massachusetts and Rhode Island,” Martin said Friday at the U.S. Offshore Wind Conference in Boston. “It’s very cost-effective for consumers.”

The Massachusetts project could be about $100 to $120 a megawatt hour, according to a February estimate from Harries, though recent UK price spikes during low wind highlight volatility. The actual prices there and in Rhode Island weren’t disclosed.

For comparison, a new U.S. combine-cycle gas turbine ranges from $40 to $60 a megawatt-hour, and a new coal plant is $67 to $113, according to BNEF data.

A new power plant in land-constrained New England would probably be higher than that, and during winter peaks the region has seen record oil-fired generation in New England that underscores reliability concerns. More importantly, gas plants get a significant portion of their revenue from being able to guarantee that power is always available, something wind farms can’t do, said William Nelson, a New York-based analyst with BNEF. Looking only at the price at which offshore turbines can deliver electricity is a “narrow mindset,” he said.

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California energy rebate freeze disrupts heat pump incentives, HVAC upgrades, and climate funding, as federal uncertainty stalls Inflation Reduction Act support, delaying home electrification, energy efficiency gains, and greenhouse gas emissions reductions statewide.

Key Points

A statewide pause on $290M incentives for heat pumps and HVAC upgrades due to federal climate funding uncertainty.

✅ $290M program paused amid federal funding freeze

✅ Heat pump, HVAC, electrification upgrades delayed

✅ Previously approved rebates honored; new apps halted

California’s push for a more energy-efficient future has hit a significant roadblock as the state pauses a $290 million rebate program aimed at helping homeowners replace inefficient heating and cooling systems with more energy-efficient alternatives. The California Energy Commission announced the suspension of the program, citing uncertainty stemming from President Donald Trump’s decision to freeze funding for various climate-related initiatives.

The Halted Program

The energy rebate program, which utilizes federal funding to encourage the use of energy-efficient appliances such as heat pumps, was a crucial part of California’s efforts to reduce energy consumption and greenhouse gas emissions. By providing financial incentives for homeowners to upgrade to more efficient heating and cooling systems, the program aimed to make green energy solutions more accessible and affordable to residents. The rebate program had been popular, with many homeowners eager to participate in the initiative to lower their energy costs and improve the sustainability of their homes.

However, due to the uncertainty surrounding federal funding, the California Energy Commission announced on Monday that it would no longer be accepting new applications for the program. The agency did clarify that it would continue to honor rebates for applications that had already been approved. The pause will remain in effect until the Trump administration provides more clarity regarding the program's future funding.

The Trump Administration’s Role

This move highlights a broader issue regarding access to federal funding for state-level energy programs. The Trump administration’s decision to freeze funding for climate-related initiatives has left many states in limbo, as previously approved federal money has not been distributed as expected. Despite federal court rulings directing the Trump administration to restore these funds, states like California are still struggling to navigate the uncertainty of climate-related financial support from the federal government.

California’s decision to pause the rebate program comes after similar actions by other states. Arizona paused a similar program just a week prior, and Rhode Island had already paused new applications earlier this year. These states are all recipients of funding from a larger $4.3 billion initiative under the Inflation Reduction Act, which is designed to help homeowners purchase energy-efficient appliances like heat pumps, water heaters, and electric cooktops.

Impact of the Freeze

The pause of California's rebate program has serious implications for both consumers and the state’s energy goals. For residents, the halt means delays in the ability to upgrade to more energy-efficient home systems, which could lead to higher energy costs in the short term, a concern amid soaring electricity prices across the state.

The $290 million program was a significant step in encouraging homeowners to invest in energy efficiency, and its suspension leaves a gap in the availability of resources for those who were hoping to make energy-saving upgrades. Many of these upgrades are not just beneficial to homeowners, but they also contribute to the state’s overall energy efficiency goals, helping to reduce reliance on non-renewable energy sources, even as California's dependence on fossil fuels persists, and decrease greenhouse gas emissions.

Federal and State Tensions

The freeze in funding is just one of many points of tension between the Trump administration and states like California, which have pursued aggressive environmental policies aimed at reducing emissions and combating climate change. California has often found itself at odds with the federal government on environmental issues, especially under the leadership of President Trump. The state’s ambitious environmental policies have sometimes clashed with the federal government's approach, including efforts to wind down its fossil fuel industry in line with climate goals.

In this case, the freeze on climate-related funding appears to be part of a broader strategy by the Trump administration to limit federal spending on environmental programs, and as regulators weigh whether the state may need more power plants, planning remains complex. While the freeze impacts states that are working to transition to clean energy, critics argue that such moves undermine efforts to tackle climate change and could slow down progress toward a greener future.

The Path Forward

For California, the next steps will depend heavily on the actions of the federal government. While the state can continue to push for climate funding in the courts, the lack of clarity around the release of federal funds creates uncertainty for state programs that rely on these resources. As California continues to navigate this funding freeze, it will need to explore alternative solutions to keep its energy efficiency programs on track, such as efforts to revamp electricity rates to clean the grid, even in the face of federal challenges.

In the meantime, California residents and homeowners who were hoping to take advantage of the rebate program may have to wait until further clarification from the federal government is provided, even as officials warn of a looming electricity shortage in coming years. Whether the program can be restored or expanded in the future remains to be seen, but for now, the pause serves as a reminder of the ongoing struggles that states face when dealing with shifting federal priorities.

As the issue unfolds, other states facing similar challenges may take cues from California’s actions, and with California exporting energy policies to Western states, broader conversations about how federal and state governments can collaborate to ensure that energy efficiency initiatives and climate goals are not sidelined due to political or budgetary differences.

California’s decision to pause its $290 million energy rebate program is a significant development in the ongoing struggle between state and federal governments over climate-related funding. The uncertainty created by the Trump administration’s freeze on energy efficiency programs has led to disruptions in state-level efforts to promote sustainability and reduce emissions. As the situation continues to evolve, both California and other states will need to consider how to move forward without relying on federal funding that may or may not be available in the future.

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US Nuclear Generating Costs 2017 show USD33.50/MWh for nuclear energy, the lowest since 2008, as capital expenditures, fuel costs, and operating costs declined after license renewals and uprates, supporting a reliable, low-carbon grid.

Key Points

The 2017 US nuclear average was USD33.50/MWh, lowest since 2008, driven by reduced capital, fuel, and operating costs.

✅ Average cost USD33.50/MWh, lowest since 2008

✅ Capital, fuel, O&M costs fell sharply since 2012 peak

✅ License renewals, uprates, market reforms shape competitiveness

Average total generating costs for nuclear energy in 2017 in the USA were at their lowest since 2008, according to a study released by the Nuclear Energy Institute (NEI), amid a continuing nuclear decline debate in other regions.

The report, Nuclear Costs in Context, found that in 2017 the average total generating cost - which includes capital, fuel and operating costs - for nuclear energy was USD33.50 per megawatt-hour (MWh), even as interest in next-generation nuclear designs grows among stakeholders. This is 3.3% lower than in 2016 and more than 19% below 2012's peak. The reduction in costs since 2012 is due to a 40.8% reduction in capital expenditures, a 17.2% reduction in fuel costs and an 8.7% reduction in operating costs, the organisation said.

The year-on-year decline in capital costs over the past five years reflects the completion by most plants of efforts to prepare for operation beyond their initial 40-year licence. A few major items - a series of vessel head replacements; steam generator replacements and other upgrades as companies prepared for continued operation, and power uprates to increase output from existing plants - caused capital investment to increase to a peak in 2012. "As a result of these investments, 86 of the [USA's] 99 operating reactors in 2017 have received 20-year licence renewals and 92 of the operating reactors have been approved for uprates that have added over 7900 megawatts of electricity capacity. Capital spending on uprates and items necessary for operation beyond 40 years has moderated as most plants are completing these efforts," it says.

Since 2013, seven US nuclear reactors have shut down permanently, with the Three Mile Island debate highlighting wider policy questions, and another 12 have announced their permanent shutdown. The early closure for economic reasons of reliable nuclear plants with high capacity factors and relatively low generating costs will have long-term economic consequences, the report warns: replacement generating capacity, when needed, will produce more costly electricity, fewer jobs that will pay less, and, for net-zero emissions objectives, more pollution, it says.

NEI Vice President of Policy Development and Public Affairs John Kotek said the "hardworking men and women of the nuclear industry" had done an "amazing job" reducing costs through the institute's Delivering the Nuclear Promise campaign and other initiatives, in line with IAEA low-carbon lessons from the pandemic. "As we continue to face economic headwinds in markets which do not properly compensate nuclear plants, the industry has been doing its part to reduce costs to remain competitive," he said.

"Some things are in urgent need of change if we are to keep the nation's nuclear plants running and enjoy their contribution to a reliable, resilient and low-carbon grid. Namely, we need to put in place market reforms that fairly compensate nuclear similar to those already in place in New York, Illinois and other states," Kotek added.

Cost information in the study was collected by the Electric Utility Cost Group with prior years converted to 2017 dollars for accurate historical comparison.

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Ford Oakville EV investment secures government funding, Unifor deal, and plant retooling, channeling $500 million plus $1.98 billion for Canadian electric vehicle manufacturing, Windsor engine contracts, and 2025 production, strengthening Ontario's auto industry.

Key Points

Government and Ford will retool Oakville for EVs, creating jobs under a Unifor deal and Windsor engine work.

✅ $500M government funding for plant retooling

✅ Ford commits $1.98B; five new EVs by 2025

✅ Unifor deal adds Windsor engine work, jobs

The federal government and Ontario have pledged to spend up to $500 million to make the Ford plant in Oakville, Ont., able to build electric vehicles, aligning with efforts to capitalize on the U.S. EV pivot underway.

The future of the plant has been a key question for Canada's automotive industry, as moves like GM's Ontario EV deal point to broader changes, ever since the Unifor union started negotiating with the automaker for a new three-year pact to cover the company's Canadian workforce.

The two sides struck a deal a few hours after a midnight strike deadline on Tuesday morning, one that will see the company commit $1.98 billion to build five new electric vehicles and an engine contract that could yield new EV jobs in Windsor, Ont.

Ford has previously committed to spending $11 billion US to develop and manufacture electric vehicles, but so far all of that money was earmarked for Ford plants in Mexico and the company's home state of Michigan.

"With Oakville gaining such a substantial portion of Ford's planned investment, the assembly plant and its workers are better set for employment going forward," said Sam Fiorani, vice-president of global forecasting at AutoForecast Solutions.

Unifor's 'unique' Ford deal includes 5 new electric vehicles in Oakville, engine for Windsor plants
Currently, the plant builds the Ford Edge and Lincoln Nautilus, but concerns over the plant's future emerged earlier this year when a report suggested Ford was contemplating scrapping the Edge altogether. The new vehicles will come as welcome news for the plant, even as Fiorani says he worries that demand for the electric vehicles (EV) has so far not lived up to the hype.

"The EV market is coming, and Ford looks to be preparing for it. However, the demand is just not growing in line with the proposed investment from all vehicle manufacturers," he said.

Plant needs upgrade first
And the plant can't simply flip a switch and start building an entirely new type of vehicle. It will require a major retooling, and that will require time — and cash — to happen, which is where government cash comes in, as seen with a Niagara Region battery plant supporting the EV supply chain.

As first reported by the Toronto Star, the two branches of government have committed to spent up to $500 million combined to upgrade the plant so that it can build electric vehicles.

"The retooling will begin in 2024 with vehicles rolling off the line in 2025," Unifor president Jerry Dias said. "So we know this is a decades-long commitment."

It's not clear what portion of the cash will come from what branch of government, but CBC News has previously reported that Wednesday's throne speech is expected to contain a number of policies aimed at beefing up Canada's electric vehicle industry, as EV assembly deals are putting Canada in the race, both on the consumer side and for businesses that build them.

Ontario's minister of economic development and trade welcomed the news of a tentative deal on Tuesday and confirmed that Queen's Park legislators stand ready to do their part, as shown by Honda's Ontario battery investment moves in the province.

"Our government will always work with our federal colleagues, workers and the auto sector to ensure the right conditions are in place for the industry to remain stable today and seize the new opportunities of tomorrow," a spokesperson for Vic Fedeli told CBC News in an emailed statement Tuesday.

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SaskPower 2019-20 Annual Report highlights $205M net income, grid capacity upgrades, emissions reduction progress, Chinook Power Station natural gas baseload, and wind and solar renewable energy to support Saskatchewan's Growth Plan and Prairie Resilience.

Key Points

SaskPower's 2019-20 results: $205M income, grid upgrades, emissions cuts, and new gas baseload with wind and solar.

✅ $205M net income, up $8M year-over-year

✅ Chinook Power Station adds stable natural gas baseload

✅ Increased grid capacity enables more wind and solar

SaskPower presented its annual report on Monday, with a net income of $205 million in 2019-20, even as Manitoba Hydro's financial pressures highlight regional market dynamics.

This figure shows an increase of $8 million from 2018-19, despite record provincial power demand that tested the grid.

“Reliable, sustainable and cost-effective electricity is crucial to achieving the economic goals laid out in the Government of Saskatchewan’s Growth Plan and the emissions reductions targets outlined in Prairie Resilience, our made-in-Saskatchewan climate change strategy,” Minister Responsible for SaskPower Dustin Duncan said.

In the last year, SaskPower has repaired and upgraded old infrastructure, invested in growth projects and increased grid capacity, including plans to buy more electricity from Manitoba Hydro to support reliability and benefiting from new turbine investments across the region.

The utility is also exploring procurement partnerships, including a plan to purchase power from Flying Dust First Nation to diversify supply.

“During the past year, we continued to move toward our target to reduce carbon dioxide emissions 40 per cent from 2005 levels by 2030, as part of efforts to double renewable electricity by 2030 across Saskatchewan,” SaskPower President and CEO Mike Marsh said. “The newly commissioned natural gas-fired Chinook Power Station will provide a stable source of baseload power while enabling the ongoing addition of intermittent renewable generation capacity, and exploring geothermal power alongside wind and solar generation.”

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