Hydro-Quebec, New Brunswick Power Close Power Deal

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The premiers of New Brunswick and Quebec have announced the conclusion of negotiations between Hydro-Quebec and New Brunswick Power (NB Power.)

As part of a global transaction worth $3.2 billion, Hydro-Quebec will acquire most of NB Power's generation assets for $1.8 billion. This will include seven hydroelectric facilities, two diesel peaking units located on the main grid, and firm transmission rights associated with the acquired generation assets, including 670 MW of transmission rights in New England.

Hydro-Quebec will also acquire the Point Lepreau nuclear facility for $1.4 billion upon its successful refurbishment, which is scheduled for January 2011. The transmission and distribution arms of NB Power and the deferral account associated with the Point Lepreau refurbishment will be retained by New Brunswick.

Hydro-Quebec will act as an electricity wholesaler to NB Power. Under a long-term power contract, Hydro-Quebec will provide NB Power with an annual supply of 14 TWh of electricity.

New Brunswick will manage this heritage electricity by creating two pools: one of 4.5 TWh for industrial customers and one of 9.5 TWh for residential, commercial and wholesale customers.

NB Power will maintain the ownership and operation of the province's transmission and distribution assets, as well as of the Grand Manan facility, which supplies electricity to the island of the same name. In addition, the thermal generating facilities at Coleson Cove and Belledune will continue to be owned by NB Power and will supply electricity to Hydro-Quebec under tolling agreements.

The transaction is expected to close at the end of March, with the exception of the Point Lepreau facility.

SOURCE: Hydro-Quebec

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