Media Release March 05, 2019
New Clear Free Solutions
MLA’s and Public petitioned to Save the Climate Change Fund siting huge economic, social and environmental benefits found in newly released Integrated Resource Plan.
On March 5, 2019 New Brunswick’s solutions-based organization, New Clear Free Solutions, wrote to all MLA’s to petition them to save the Climate Change Fund from being repealed from the Climate Change Act. In support of the petition the organization has also released their new Integrated Resource Plan (IRP) showing the many economic, social and environmental benefits that the fund can provide.
Chris Rouse, the main author of the plan states “Not only is this really good environmental policy, but our business plan shows it will also provide huge economic benefits to the province”. Rouse is also encouraging members of the public to also write their MLA’s and party leaders to show support for the framework in the newly released plan as well as asking MLA’s to vote against repealing the Climate Change Fund.
Rouse argues that the climate change fund can co-exist with the federal plan, as it does not introduce any new cost to consumers, which is the reason the federal government did not approve it. “By not approving it, the federal government did not mean we have to get rid of it, as they have no jurisdiction to do so.” Given that there is no cost to consumers, the climate change fund would still be in line with all party’s election commitments -even the commitment of “No Carbon Tax”. That is because it is a fund, not a tax.
An Integrated Resource Plan (IRP) is a comprehensive decision support tool and road map for meeting a utility’s objective of providing reliable and least-cost sustainable electric service to its customers while addressing the substantial risks and uncertainties inherent in the electric utility business. It is essentially the utility’s long-term business plan.
New Clear Free Solutions’ plan is a comprehensive visual document intended to guide the public and official decision makers through the critical decisions that need to be made in developing an IRP for New Brunswick. It is also intended to provide an alternative and comparison to our current business as usual (BAU) IRP. The document shows that private investment is not in the publics’ interest.
The alternative IRP examines the business case for a public investment of the Climate Change Fund revenue through our publicly owned utility into renewables, efficiency and fuel switching. It is consistent with current legislation including the Electricity Act and Climate Change Act that came into force in April 2018. It has the objective of transitioning 95% of our total energy needs to renewables using our own local renewable energy resources. This displaces most of our carbon energy cost that is external to our economy and redirects these funds back into the province.
Conclusions from the alternative IRP:
- There are no technical or economic barriers to the transition to a low-carbon economy.
- Publicly investing the Climate Change Fund revenue into renewables, efficiency, and fuel switching will provide significant benefits to the economy, environment and the New Brunswick society.
- The investment coupled with the reinvestment will provide all the capital needed to transition to a low-carbon economy.
- Publicly investing the Climate Change Fund revenue will keep rates low and stable.
- Publicly investing the Climate Change Fund revenue will pay huge dividends to the province and hence all New Brunswickers not just a select few.
- Publicly investing the Climate Change Fund revenue will get NB Power out of debt.
- Publicly investing the Climate Change Fund revenue will significantly reduce our emissions.
- Publicly investing the Climate Change Fund revenue will create many jobs and create a huge multi-decade construction boom.
After extensive research and consultations, New Clear Free Solutions has determined that most New Brunswickers want a strong economy and clean energy at low rates provided by NB Power. Given that renewables are now the least cost option, this alternative plan gives the people of New Brunswick what they want. The IRP that exists currently is the problem, not the Fund. We can seize the day, vote to keep what works and change what doesn’t.
Links to MLAs are provided below so that community groups and the general public can send a message to their MLAs and party leaders to vote against repealing the Climate Change Fund and show support for the framework used in this IRP.
Links to Additional Information
Links to Additional Information
New Clear Free Solutions has submitted evidence to the Energy and Utilities Board that NB Powers Integrated Resource Plan [IRP] is putting the Province at risk of the Federal Government putting an additional gas tax on New Brunswickers, and is driving electricity rates up.
Click Link to Read Evidence New Clear Free Solutions Matter 375 Evidence January 18 2018 New Clear Free Solutions Matter 375 Evidence Web
Chris Rouse, who submitted this evidence and has asked to be qualified as an expert at the hearings and states:
“It is not the new carbon tax policy that the federal government won’t like, it will be NB Powers IRP. We need to show them in September how we can significantly reduce our emissions without any additional tax slapped on us. NB Power’s IRP will not satisfy the Federal government, and if we get an additional gas tax it will be NB Powers fault. “
Using information provided by NB Power Mr. Rouse supplied the following graphs to the utilities board. They show that all of this extensive energy efficiency the Utility has been promoting, using ratepayer money, has almost no effect on emissions when compared to doing nothing. NB Powers grid is 75% carbon free so the effects of efficiency are minimal.
Chris also asked the utility how their ratepayer funded Reduce and Shift Demand programs was going to affect its bottom line. The information from NB Power showed that over the next 10 years the Utility is going to loose almost $700 million in net earnings and negatively affect its Corporate objective of earning enough money to reach a 20% equity target.
Lost earning equals higher rates, so Mr Rouse also asked the utility if ratepayers would still need a rate increase if the Utility Board does not approve NB Powers efficiency programs. The results show we could go 3 years, equaling a 6% rate increase, with no rate increases and reduce debt even further than the current plan.
NB Power asserted in its evidence that rates will be higher but customers bills will be lower due to the efficiency.
Chris’s concerns about these programs increasing rates was supported by the evidence submitted by the public interveners consultant. He identified issues with NB Powers way of thinking. Mr Kenecht states in his evidence:
“The primary implication is the converse of that described above for “minimize rates,” namely that the “minimize cost” test may very well result in higher rates, resulting in cross-subsidies from non-participants to participants.” Kenecht then goes on to recommend NB Power update its IRP.
Mr. Rouse was also concerned about the cross-subsidization and asked NB Power for the percentage of participants vs non participants during the hearing process to see if these programs are fair. The results from the utility show that less than 1% of ratepayers are participants and 99% of ratepayers are ending up with higher bills.
There are also concerns about who can participate in these “incentive” programs due to the significant upfront costs, so only wealthy people can participate. When asked about it during the hearings NB Power responded:
“NB Power is also investigating potential financing mechanisms to reduce the barriers in programs that require “significant” upfront participant investment to participate.”
After a lot of research into this it was found that this issue of “lower bills” vs “lower rates” is not something new. He found that there was a shift in NB Power thinking in 2010 when lower bills was chosen over lower rates, and that the previous Public Utilities Board and NB Power have both agreed in 1991 and again in 2001 that lowest rates was the appropriate measure not lowest bills.
With some guidance from Kerrie Blaise, an environmental lawyer from Ontario, Chris is arguing that the Utility has interpreted the legislation wrong and that the Electricity Act puts a priority on “lowest possible rates” not lowest bills.
Chris assert that the evidence shows efficiency won’t solve the problem and we risk the federal government taking additional actions on the Province. In order to stop climate change we need to just simply shift from fossil energy to renewable energy. He provides almost every publicly available data source that shows renewable energy is the lowest cost energy on the market and still dropping. The solution is now less expensive than the problem so there is no need to wait.
Again using NB Power supplied information, Chris presented another graph that showed the other options in NB Powers Integrated Resource plan, sorted from least cost rates to highest cost rates. The options with wind power all have lower rates, and shows more efficiency is going to lead to skyrocketing rates.
Chris provides a new plan to NB Power that instead of reducing and shifting demand to defer investments, will invest the Carbon tax into renewables and switch industry and automotive sectors over to a green grid. This plan is compatible with the new proposed legislation that contains many of the same principles his group has been promoting for several years. NB Powers evidence shows the more energy NB Power sells the lower rates can be. NB Power can increase its earnings without rate increases just by simply displacing fossil fuels from other sectors.
Chris reminds the Utilities board and NB Power he is not opposed to efficiency just the efficiency programs that NB Power has developed. He offered 4 different programs that would lead to lower rates while significantly reducing emissions.
While we all think efficiency is a good thing, Chris’s intervention highlights that it can be dangerous if it is taking time and money away from the real solution renewable energy. Efficiency is always good personal policy, but bad public, and environmental policy.