Consumer advocate says public hearings should be required for Newfoudland and Power capital applications

The province’s consumer advocate says ratepayers are getting short shrifted by the Public Utilities Board (PUB) not holding public hearings on Newfoundland Power capital-spending applications.

The shortcut, Dennis Browne said, limits ratepapers’ ability to properly question the applications — as followups require seeking permission — and has been routinely used for years due to a change in guidelines.

“There’s no end in sight,” Browne told SaltWire Network Tuesday, Oct. 12, about the spending.

“Something has to be done.”

Public hearings, he said, would clear the air on what’s proposed.

The latest application would see Newfoundland Power spend $110 million in 2022.

It comes at a difficult time, Browne said, noting the need for rate mitigation due to the Muskrat Falls hydroelectric project.

Because the board wants to use a paper procedure based on 2007 guidelines, Browne said, that ensures Newfoundland Power’s personnel don’t have to appear in public to justify the expenditures.

The advocate’s expert asserts that the capital budget guidelines aren’t adequate, and Newfoundland Power hasn’t identified and evaluated a reasonable range of alternatives.

“Is there another utilities board in the country which would refuse a public hearing and allow a $110-milion capital budget application to proceed using guidelines that are known to be inadequate?” Browne stated in a news release.

“The board’s own experts recommended the 2007 guidelines be changed.”

He said that for more than 16 years Newfoundland Power has been approved for everything it requested in annual capital expenditures — totalling $1.3 billion — and has failed to balance the rights of ratepayers against the utility.

Browne said the legislature will be asked to act to ensure 270,000 ratepayers get full hearings, and he has written to each MHA seeking support.

The Muskrat Falls inquiry report recommended reviews of the legislation, so in the long term the acts could be overhauled.

However, in the short term, Browne said the House should put in a fix that requires any capital spending over $50 million to require a full public hearing.

The consumer advocate, meanwhile, has lost an application before the Newfoundland and Labrador Court of Appeal for leave to appeal an order of the PUB that approved capital expenditures proposed by Newfoundland Power Inc. in 2021, specifically the replacement of a computerized customer service system to cost $31.6 million over three years.

The consumer advocate claimed the PUB “exceeded its jurisdiction, and breached its duty of procedural fairness, in granting the order without following the proper procedures.”

On Jan. 6, after hearing submissions, the board decided there would be no public hearing, stating it was satisfied the written review process allows a full opportunity to gather information and challenge the respondent’s capital budget application, the decision notes.

In response to the consumer advocate, the PUB said there was “a fair and open procedure, appropriate to this decision, with an opportunity for those affected to put forward their views and evidence fully. A public hearing was not required to achieve procedural fairness.”

The board has authority to choose its own procedures, and has expertise in determining what procedures are appropriate, the appeal court ruling by Justice William Goodridge said.

Browne told SaltWire he doesn’t consider that decision to be a precedent, and his office won’t hesitate to use the courts again.

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