New BrunswickAn Energy and Utilities board review of a major new gas plant deal between N.B. Power and ProEnergy will happen a month earlier than originally planned, to avoid a deadline that could see the U.S. company walk away from the deal. ‘Urgent shortage’ of turbines gives U.S. company incentive to cancel agreement, and get paid more elsewhereErica Butler · CBC News · Posted: Dec 04, 2025 5:00 AM EST | Last Updated: 2 hours agoListen to this articleEstimated 6 minutesThe audio version of this article is generated by text-to-speech, a technology based on artificial intelligence.N.B. Power will bring its 500MW gas plant deal before the Energy and Utilities board in February, about one month earlier than originally planned. (CBC News)N.B. Power is warning that the U.S. company it hired to build and run a billion-dollar gas plant could walk away in April — a move that would set the project back years, and possibly lead to power shortages in the province.N.B. Power’s top financial officer said that ProEnergy has an ‘economic incentive’ to abandon the Tantramar gas plant deal if a regulatory deadline is not met. In a statement submitted to the New Brunswick Energy and Utilities Board, N.B. Power Chief Financial Officer Justin Urquhart asked the board to help the utility meet a deadline in its contract with ProEnergy by moving up the hearing on the project. The hearing is now scheduled for Feb. 9 to 13, 2026. Cancellation could mean energy shortfalls, says N.B. PowerThe contract with ProEnergy was signed on July 2, 2025, and includes a condition that gives N.B. Power nine months – until April 2, 2026 – to get Energy and Utilities Board approval. Otherwise, ProEnergy has the right to pull out of the deal. That would leave N.B. Power back at square one in its procurement process, and facing higher costs and years-long delays, if the utility tries again to build a similar project.N.B. Power has warned the gas plant is needed to prevent a power capacity shortage it predicts could come by winter 2028. In an email, utility spokesperson Elizabeth Fraser said the gas plant is the “most optimal solution,” to tackle the potential shortage.The Brotman Generating Station in Rosharon, Texas, has similar components and layout as the proposed project that ProEnergy would build in Tantramar. The EUB will hear arguments for and against the project in a hearing Feb. 9 to 13, 2026. (Submitted by ProEnergy)“If we were to start over, … it’s likely we wouldn’t be able to deliver a solution until 2031, leaving the potential for generation shortfalls between 2028-2032,” Fraser wrote. Tantramar MLA Megan Mitton, whose riding is home to the proposed site for the gas plant, said she wants N.B. Power to consider other solutions. “I actually would like for this contract to fall through,” said Mitton. “And N.B. Power can pursue a different pathway– renewable energy and storage and energy efficiency–and really throw everything at that.”N.B. Power asked for extensionUrquhart said the utility tried to negotiate a deadline extension with ProEnergy, but the company drove too hard a bargain, with commercial terms “not acceptable to N.B. Power.”Urquhart said there’s an “urgent shortage” of combustion turbine engines like the ones ProEnergy plans to install and run in rural Tantramar. That means new projects could face “at least a 20 per cent increase in costs as compared to projects already in the production queue.” He also warned that new projects could see a “lead time of approximately 5 to 6 years or more.”“Economic leverage has shifted entirely to suppliers,” wrote Urquhart, “with project cancellations becoming opportunities to repurpose units at higher prices.”Attempt to avoid review contributed to delayThe time crunch N.B. Power is currently facing is in part a result of one of its early decisions, said Mitton.“One of the reasons that they’re running out of time is that they tried to avoid going to the [board] in the first place,” said Mitton. Tantramar MLA Megan Mitton said she’d like to see the agreement with ProEnergy fall through, and for N.B. Power to pursue a ‘different pathway’ to energy security. (Michel Corriveau / Radio Canada)Shortly after signing its contract with ProEnergy in July, N.B. Power asked the board to exempt the agreement from review, arguing it was actually not in the jurisdiction of the board. Nearly three months later in mid-October, that argument was rejected by the board, and N.B. Power was left to begin the review process with its regulator.Site change already contributed to cost increaseThe total cost of the 25-year agreement with ProEnergy is unknown, but is already higher than N.B. Power originally anticipated, according to new evidence the utility has submitted to the Energy and Utilities board. “The negotiating process took longer than was assumed,” reads the N.B. Power document, citing the change in proposed locations for the plant, and discussions over the scope of the work. N.B. Power originally told reporters it was working on a site in the Scoudouc Industrial Park for the ten turbine gas plant, but then changed its mind in February 2025 in favour of Centre Village, in rural Tantramar.The “protracted negotiations led to cost increases due to supply chain pressures on aeroderivative combustion turbine units,” reads the N.B. Power document. P.E.I. utility and ‘third party’ also affectedA potential cancellation of N.B. Power’s contract with ProEnergy could cause issues for others related to the project. In its filings, N.B. Power said it is negotiating a deal with a third party in the Maritimes to buy 100MW of generating capacity in addition to the original 400MW the utility said it needs from the new gas plant. N.B. Power Vice President Brad Coady testified before the public accounts committee of the New Brunswick legislature on October 10, 2025. (Legislative Assembly of New Brunswick webcam)It also says the “expansion opportunity” will reduce overall costs for N.B. Power ratepayers, because it can charge the third party a premium for the extra power. It’s not clear who the third party is, and N.B. Power said it has yet to sign a proposed 10-year agreement for the 100MW expansion. According to documents filed by P.E.I.’s Maritime Electric, the Island utility is not looking to expand the electricity it imports from New Brunswick, but it is hoping to piggyback on the deal N.B. Power is striking with ProEnergy. Maritime Electric is seeking permission from its regulator to spend $334 million to install two of the U.S. company’s aeroderivative gas turbines on the Island.In Nova Scotia, the new independent body responsible for managing the province’s grid has issued a request for expressions of interest for “fast acting natural gas generation”. In an emailed statement, the grid operator said it can’t confirm whether it is also pursuing agreements to buy additional power from N.B. Power. ABOUT THE AUTHORErica Butler is a reporter with CBC New Brunswick. She lives in Sackville and works out of the Moncton newsroom. You can send story tips to erica.butler@cbc.ca.
N.B. Power needs gas plant approval before April 2, or the deal may be off
