The series of upgraded transmission lines between Quebec, New Brunswick and Nova Scotia known as the Atlantic Loop has been pitched as a crucial piece as the region looks to decarbonize electricity generation.
But New Brunswick Power’s vice-president of business development, Brad Coady, says the project doesn’t offer much benefit to the province in the short term.
“We’ve done a lot of analysis at the utility that suggests that in the near-term, because we’re already so well-connected with Quebec, that we wouldn’t need that line, that infrastructure until much later out in time,” he told the legislature’s public accounts committee last week.
Earlier this year, New Brunswick’s deputy minister of energy, Tom MacFarlane, told MLAs that the loop is necessary piece of the puzzle as New Brunswick looks to replace the 450MW of coal power capacity in the province after the 2030 moratorium.
Power generation will have to be 100-per cent non-emitting by 2050 and Nova Scotia has legislated targets to generate 80 per cent of its power from renewable sources by 2040.
But since then the utilities in New Brunswick and Nova Scotia, as well as their corresponding provincial governments, have greatly cooled on the project.
The main reason: the initial cost estimate of $2.5 billion has grown to $7.5 billion.
“What we’re seeing at our utility is that the value or the benefits won’t start to accrue until the 2040s,” Coady said.
“So in the world that we operate in, that sends us a signal that says that capital deferral or deferral of the project is in order. Not to say the project doesn’t bring benefits, not to say it wouldn’t be a great piece of infrastructure, what we’re saying is we can’t draw enough benefits from that piece of infrastructure today to offset the costs.”
The federal government has offered $4.5 billion in long-term loans, but that has failed to get the two provinces on board.
But Moe Qureshi, the manager of climate solutions with the New Brunswick Conservation Council, says that transmission capacity will need to be upgraded at some point and since the price will likely only continue to grow, now is the time to get it done.
“Regardless, in the future we’re going to need more, either interregional or the Atlantic Loop; transmission has to be increased. So I think it’s in everyone’s interest if we do it sooner rather than later.”