If anything goes wrong with a plan to generate electricity by burning wood waste at a plant in Point Tupper, it will become the financial burden of Nova Scotia Power customers, the province’s consumer advocate has told the Utility and Review Board.
"The board should make a finding that exposing ratepayers to the risk of such additional costs is imprudent," John Merrick wrote in a rebuttal argument filed Friday with the board.
"Such a finding is amply supported on the evidence. As a result, the application should be denied."
Both sides are turning up the heat over a controversial proposal for a $208-million biomass power plant. Nova Scotia Power and its project partner, NewPage Port Hawkesbury, are behind the proposal.
The review board must approve the project if it is to proceed. The proposal faces opposition from energy consultants, environmentalists, businesses and Merrick, the consumer advocate.
A decision is expected within 90 days of submission of the final evidence. The board rejected a similar proposal last summer.
Merrick has raised concerns about the financial troubles plaguing NewPage Corp., the Ohio company that owns NewPage Port Hawkesbury, and the risk that Nova Scotia Power customers will be exposed to if the biomass project incurs additional costs or if NewPage Corp. fails.
Merrick was critical of NewPage Port Hawkesbury for saying that its parent company’s financial situation is no different from that of other companies in the forest products business.
"Doing business with NewPage has a higher risk than doing business with other forest products companies generally," Merrick stated.
During a public hearing earlier this month, a U.S. consultant working for the review board showed that NewPage Corp., which is owned by private investment firm Cerberus Capital Management LP, has $7 million in cash and $113 million available on a line of credit, but it also has a debt of $3.4 billion.
Liberty Consultants recommended that Nova Scotia Power go back and negotiate with two other companies offering biomass proposals, Northern Pulp Nova Scotia Corp. and Cape Breton Explorations Ltd.
Nova Scotia Power said Merrick’s previous comments about a possible restructuring of NewPage Port Hawkesbury’s parent company were "speculative."
"In fact, the experience in Nova Scotia suggests that the local mill operation, and the biomass plant that supports it, would continue as usual during the financial restructuring of a parent company," Nova Scotia Power wrote in its rebuttal arguments to the board.
The utility states that the "concerns" of other interveners "do not identify issues that should cause the board to reject the project; instead, the board should accept the evidence of those in support of the project, including NewPage and the Nova Scotia government."
Nova Scotia Power wants the review board to approve the biomass project to help it meet the province’s targets for producing electricity from renewable sources. The company would like to get the plant up and running by 2012.
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