Auditor general slams NB Power for taking shortcuts on new power plant project

The New Brunswick flag flies in front of the Legislative Assembly Building, home of the provincial parliament, in Fredericton, Saturday, July 26, 2025. THE CANADIAN PRESS/Giordano Ciampini

FREDERICTON — New Brunswick’s Crown energy corporation made a series of poor choices with its planned natural gas power plant that exposed taxpayers to millions of dollars worth of risk, the public auditor general says.

The utility entered into a long-term agreement without regulatory approval and selected equipment without studying alternatives, among other missteps, auditor general Paul Martin said in his report released Tuesday.

While the need for a new natural gas plant is valid, Martin told lawmakers after publishing his report, NB Power “did not proceed in the clearest or most disciplined order, increasing governance, financial and regulatory risk for New Brunswick power and energy customers.”

The Renewable Integration and Grid Security project is a 500-Megawatt natural gas power plant proposed for rural southeastern New Brunswick. It received approval from the provincial energy regulator last week, but still requires a green light from the Liberal government after the results of an environmental assessment, which is ongoing.

NB Power has pitched the project as an urgent response to prevent future energy shortages caused by retiring coal and oil facilities. The corporation says the future plant will also provide a backstop when renewable energy sources are impacted by weather.

But Martin writes that as NB Power moved ahead with the project over the last few years, “critical choices were made without addressing significant risks.”

In one example, Martin wrote NB Power last year signed a 25-year deal with U.S. firm ProEnergy to run the plant before the project received regulatory approval. That decision, the auditor said, was a misstep that exposed NB Power to tens of millions of dollars in potential penalties.

NB Power signed the deal in July 2025 for the plant, which Martin says will have a final price tag of $2.8 billion. But the province’s Energy and Utilities Board in October 2025 determined the corporation first needed its approval for the capital project.

“This meant that NB Power had already entered into a long-term agreement without regulatory approval,” wrote Martin. If the utilities regulator had denied the project, NB Power could’ve been forced to compensate ProEnergy for $55.1 million in early construction costs.

He said there were other failures, too. NB Power selected dual-fuel combustion turbines -- which can switch from gas to diesel if needed -- for the plant before looking into alternatives, Martin wrote.

Martin also criticized NB Power for assuming most of the risk by being the sole owner of the plant, which he said negated the benefits of entering into a ownership deal with ProEnergy. For example, the auditor said, NB Power must pay for the fuel it produces regardless of whether it’s consumed, and the corporation has assumed responsibility for emissions-related costs.

NB Power was not immediately available for comment on the auditor general’s report Tuesday.

Lori Clark, the corporation’s CEO, wrote a response dated April 17, 2026, included in Martin’s report, saying the decisions were necessary due to a peak power demand shortfall during the winter months. Clark wrote that “complex infrastructure decisions made under time pressure and heightened risk can reasonably give rise to differing perspectives.”

The natural gas plant project is scheduled to be in operation by August 2028.

Martin is scheduled to speak with reporters later on Tuesday.

By Eli Ridder

This report by The Canadian Press was first published June 2, 2026.