J.D. Irving, Limited has expressed deep concern over the New Brunswick Energy and Utilities Board's decision to increase electricity rates by 20-25 percent over the next two years, a move that will significantly affect all ratepayers in the province, including large industrial consumers.
As the largest electricity consumer in New Brunswick, Irving Paper is particularly impacted. The paper manufacturing operation already faces electricity rates 22 percent higher than the national industrial average. Following the new rate hikes, this will increase to over 30 percent above the average, making it even more difficult for the company to remain competitive.
“NB Power’s projected rates represent a 50 percent increase in electricity costs over a five-year period,” said Mark Mosher, Vice President of Pulp & Paper at J.D. Irving, Limited. “No business can absorb such increases without negative impacts.”
The underlying causes of New Brunswick’s soaring electricity costs have been long-standing and are well documented. One major factor is the ongoing underperformance of the Point Lepreau Nuclear Generating Station, which has been operating in the bottom 25 percent of North American nuclear stations since 2018. Currently, the facility is in an unplanned outage, and even under optimal conditions, it will only operate for 30 percent of the year. Additionally, unplanned equipment failures at the Bayside Power and Belledune Generating Stations, along with high debt levels and an overreliance on imported energy, have left New Brunswick's ratepayers exposed to rising electricity costs.
Irving Paper, which manufactures 400,000 tonnes of paper annually—95 percent of which is exported to 65 countries—has already been forced to shut down 50 percent of its operations in response to the steep electricity rates. In October, the company was down for over 12 days, and may remain shut down until NB Power’s plants return to full operation. The current electricity rates severely undermine Irving Paper’s ability to remain competitive on the global stage.
Mark Mosher also pointed out that other provinces, including Ontario and Quebec, have invested in programs designed to retain and attract energy-intensive manufacturing industries. "We have invested significantly in making our facilities as energy efficient as possible in an effort to offset the province’s high electricity costs," Mosher said. "However, without clear policies to address these structural issues, as seen in Ontario and Quebec, New Brunswick’s industrial base will continue to shrink, and the province will struggle to attract new investment."
Irving Paper’s operations are based in Saint John at 435 Bayside Drive. The company employs 310 direct workers and supports over 700 indirect jobs through its supply chain, including wood harvesters and truck drivers. In 2023, it made $144 million in purchases from over 300 suppliers in 40 New Brunswick communities. It is also a major consumer of wood chips from New Brunswick sawmills, many of which are sourced from local private woodlots and marketing boards.
As electricity costs continue to rise, there are growing concerns about the long-term viability of industries like Irving Paper in New Brunswick. Without policy changes and investment in sustainable energy solutions, many fear the province may lose its competitive edge and struggle to attract future industrial investments.
