The province’s consumer advocate is accusing Newfoundland Power of undermining the rate mitigation plan by asking the Public Utilities Board for more rate increases.
The rate mitigation plan was finalized last week, with government saying it will keep the cost of paying off the Muskrat Falls project to 13.5 cents per kilowatt hour for the next six years.
Without that plan, officials say electricity rates would have risen to 24 cents a kilowatt hour just to pay off the $13.5-billion project.
But Newfoundland Power has two applications before the PUB; one seeks a 1.5 per cent increase as of July 1st this year, while another seeks a 5.5 per cent increase next July.
And consumer advocate Dennis Browne says those increases could eliminate some of the relief offered by rate mitigation.
Newfoundland Power is also seeking rate increases to deal with operational costs and capital expenditures, and is asking the PUB to increase its rate of return, or profit margin, from 8.5 per cent to 9.85 per cent.
That would increase profits from $48 million to more than $58 million a year,
Browne says the PUB should ensure Newfoundland Power “puts its own financial affairs in order before it seeks increased rates from ratepayers.”