Environmental group calls on UARB to reject biomass project

Nancy King
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[Point Tupper, NS]—An Inverness County environmental group is calling on the province’s energy regulator to reject a proposed biomass project involving NewPage Port Hawkesbury and Nova Scotia Power Inc.

The proposed $208-million deal has been the subject of Utility and Review Board hearings in Halifax, which have ended. The board is accepting final submissions on the proposal until Friday (Sept. 24).

In its filing, the Margaree Environmental Association noted the role of the UARB is to protect the public from unnecessary and unwarranted expenditures by NSPI and assure the public as much as possible that expenditures won’t have long-term negative consequences to ratepayers.

“Any attempt to portray this project as green or renewable, in order to meet provincial requirements for green power, is a sham,” the MEA wrote. “Nova Scotians would be angry and would oppose the project if they understood that a wood incinerator was going to be built that would increase the amount of (carbon dioxide) emitted in the province, and yet be qualified as part of the renewable energy standard for the province. Nova Scotians would be even angrier if they knew that the power was not needed on our provincial grid, and was not going to result in a reduction of coal burning and mercury pollution.”

NewPage and NSPI have argued the project is in the interest of the province’s electrical customers and should be approved, without conditions. It would generate about 60 megawatts of electricity a year, representing about three per cent of the NSPI’s generation, or enough energy to power about 50,000 homes. NSPI would invest $200 million in the project, while NewPage would construct and operate it, and supply fuel.

The project would create 150 new jobs in harvesting, silviculture and trucking.

NewPage said in its final submission that the proceedings showed there is sufficient available and commercially harvestable biomass for the project and it can be obtained in a sustainable manner.

In its final submission NSPI said that the board does not need to apply conditions on its approval of the project in order to serve the best interests of customers. It noted that on capital expenditure applications, the board’s task is to grant or withhold approval, not to amend proposals or the contracts on which the proposal is based.

Consultants hired by the UARB were concerned that the project poses risks to NSPI customers due to the precarious financial position of NewPage’s parent company.

Last month (August), a debt research firm issued two reports showing concern about the parent company. NewPage countered that evidence and argued it essentially discounted NewPage’s most recent management guidance on its financial position. NewPage noted that the more capital that is invested at the mill site, the more likely it is to continue to thrive and grow in the future and it has structured the project so that it will in fact operate cost-effectively as a stand-alone facility if the mill was to cease operating.

“NSPI recognizes the financial stress facing NewPage, and other companies in the paper industry, and submits that the fears expressed ... are greatly overstated and that the risks are adequately mitigated,” the utility’s submission states.

John Merrick, the province’s consumer advocate, argued the proposal has an excessive and unreasonable risk of increased costs for ratepayers and shouldn’t be approved unless there are conditions attached to reduce or remove that risk. A decision is expected within about three months.

Cape Breton Post

 

Organizations: Utility and Review Board, Margaree Environmental Association

Geographic location: Halifax, Cape Breton

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