Irving Paper has announced another round of temporary production cuts beginning December 2, 2024.
The company will reduce its operations by 50% for at least a week in response to record-high industrial electricity rates from NB Power.
Mark Mosher, Vice President of Pulp & Paper at J.D. Irving, Limited, explained that current electricity rates are over 100% higher than historical levels, attributing this increase to ongoing delays at NB Power's Point Lepreau generating station. He noted that Irving Paper has already experienced over 30 days of shutdowns or reduced operations in 2024.
The company produces 400,000 tonnes of paper annually, with more than 95% of its output exported to 65 countries. Annual electricity costs for Irving Paper are projected to rise significantly, from $60 million to over $80 million in 2024 and potentially reaching $100 million in 2025. The mill employs 310 people directly and supports more than 300 suppliers throughout New Brunswick.
In an effort to mitigate the impact of high electricity costs, Mosher indicated that the company has invested in alternative energy sources and energy efficiency measures. However, he cautioned that without clear policy changes to address larger structural competitive issues, New Brunswick's industrial base may continue to contract.
This announcement follows a similar reduction in operations earlier in 2024 when electricity costs surged to levels between 400% and 500% higher than normal prices. The ongoing situation underscores the challenges faced by energy-intensive industries in the region due to fluctuating electricity costs.
Located on Bayside Drive in Saint John, Irving Paper employs 310 people and supports over 300 suppliers across the province. In 2023, the company contributed $144 million in purchases to 40 New Brunswick communities and serves as a major consumer of wood chips from local sawmills.
