Governments love theater. When a state-backed power utility drowns in billions of dollars of debt, politicians do not fix the structural rot. They build a stage, hire an actor, and call it consumer advocacy.
New Brunswick’s decision to establish a dedicated consumer advocate for energy is the latest example of this bureaucratic misdirection. The mainstream narrative frames this move as a victory for the little guy. It is pitched as a bold step to protect everyday ratepayers from the soaring costs of a debt-saddled utility.
That narrative is a lie.
Creating a consumer advocate does not lower power bills. It does not pay down billions in systemic debt. It simply institutionalizes the grievance process while keeping the underlying monopoly completely intact. We are creating a taxpayer-funded referee for a game that was rigged from the start.
The Illusion of Protection
The fundamental flaw of the energy advocate model is the assumption that intervention equals impact. For decades, regulated utilities across North America have operated under a cost-of-service model. Under this framework, regulatory boards like the New Brunswick Energy and Utilities Board (EUB) review rate applications.
The standard process is highly predictable:
- The utility requests a massive rate hike to cover ballooning capital expenses and debt servicing.
- The consumer advocate objects, presenting dense economic models to argue for a lower increase.
- The regulatory board splits the difference.
The utility still gets its raise. The advocate claims a symbolic victory by shaving off a fraction of a percent. The ratepayer still loses.
I have watched public utilities commissions play this exact game for years. It is a highly specialized, expensive performance. The advocate hires consultants, forensic accountants, and energy lawyers. The utility matches them dollar for dollar, using money extracted directly from ratepayer bills. Billions of dollars in debt cannot be argued away by a lawyer sitting in a committee room. The math does not care about advocacy.
The Real Debt Driver Regulatory Captured Monopolies
New Brunswick's energy crisis is not a failure of advocacy; it is a failure of structure. NB Power is suffocating under a massive debt load, heavily exacerbated by aging infrastructure and catastrophic delays in major projects, such as the refurbishment of the Point Lepreau nuclear generating station.
When a private company mismanages a multi-billion-dollar capital project, shareholders take the hit. Equity is wiped out. Management is fired. The market forces a restructuring.
When a crown corporation mismanages a project, the debt becomes a sovereign liability. The government cannot let the utility fail, so it uses the regulatory system as a slow-motion taxing mechanism. A consumer advocate cannot fix Point Lepreau's operational downtime. An advocate cannot change the global market price of fuel or the interest rates on debt refinancing.
By focusing public attention on the rate-setting hearings, the province successfully shifts the blame. The public vents its frustration at the EUB hearings, believing their voice matters, while the structural monopoly remains completely insulated from the real cure: market competition.
The Disadvantages of the Contrarian Cure
To fix New Brunswick’s energy crisis, the province must dismantle the monopoly and introduce retail choice. If consumers could choose their electricity provider, the market would penalize inefficiency. Bad management would lead to bankruptcy, not guaranteed rate hikes.
But true market liberalization has its own harsh realities. Let us be entirely transparent about the downsides of a deregulated energy market:
| Market Element | Regulated Monopoly Model | Liberalized Market Model |
|---|---|---|
| Price Stability | High predictability; rates are locked in for long periods via regulatory decrees. | High volatility; prices fluctuate based on real-time supply and demand. |
| Risk Allocation | Ratepayers bear 100% of the long-term capital and debt mismanagement risks. | Private investors bear the capital risk, but consumers face short-term price spikes. |
| Innovation Rate | Extremely slow; technology adoption depends on political and bureaucratic approval. | Fast; providers compete on efficiency, smart-grid tech, and custom pricing plans. |
Texas proved that total deregulation without proper guardrails can trigger catastrophic price spikes during extreme weather events. Alberta's transition showed that shifting away from a legacy footprint is a messy, politically bruising process.
But hiding behind a consumer advocate because the alternative is difficult is cowardice. The current path guarantees a slow death by a thousand rate hikes.
Dismantling the People Also Asked Delusions
Look at the standard questions surrounding this policy shift. The premises themselves are broken.
Will a consumer advocate for energy lower my monthly electricity bill?
No. An advocate merely debates how quickly your bill will rise. They operate within the boundaries of the utility’s existing debt obligations. If the utility needs $500 million to service its debt this year, that money must come from somewhere—either direct electricity rates or general provincial taxation. An advocate cannot make that debt vanish.
Why can't the government just cap energy rates?
Because artificial price caps destroy infrastructure. If New Brunswick caps rates below the actual cost of generation and debt servicing, NB Power’s credit rating drops further to junk status. Borrowing costs skyrocket, making future infrastructure maintenance even more expensive. Eventually, the grid fails, resulting in blackouts. You either pay through your rates today, or you pay with your grid stability tomorrow.
Is an independent energy advocate better than a government department?
It is a distinction without a difference. Whether the advocate operates independently or under a government ministry, they are still trapped within the same regulatory framework. They are fighting over the crumbs of a broken pie.
The Unconventional Blueprint for Real Energy Reform
If New Brunswick genuinely wanted to protect consumers, it would bypass the advocate theater entirely and execute a hard pivot toward structural disruption.
Break NB Power into Pieces
Separate the generation asset portfolio from the transmission grid. Keep the transmission lines as a regulated common carrier, open to anyone who can generate power efficiently.
Legalize Merchant Generation and Microgrids
Allow private industrial players, community cooperatives, and regional microgrids to generate and sell power directly to consumers over the common grid without needing a certificate of public convenience from a protective bureaucracy. If a paper mill or a solar cooperative can produce cheaper power than a legacy nuclear plant, let them steal the customers.
Force Debt Optimization via Equity Swaps
Stop pretending the utility can pay down its debt through standard operations. The province must consider writing down a portion of the utility's debt by selling off minority equity stakes in specific generation assets to private operators who actually know how to run them efficiently.
Stop Clapping for Bureaucracy
The announcement of a new consumer advocate is not progress. It is an admission of defeat. It is the political class telling you that they have no intention of fixing the structural monopoly, so they are giving you a designated champion to hold your hand while your rates climb over the horizon.
Stop celebrating the creation of new government offices. Demand the destruction of the barriers that keep you trapped in a single, failing energy system.
Turn off the theater lights. Dismantle the monopoly.
