Francois Beaulieu, acting chair of the New Brunswick Energy and Utilities Board, delivers an oral decision on Feb. 1, 2021. (Image: Zoom video capture)
Redacted information submitted by Irving Oil as part of an application before the Energy and Utilities Board (EUB) will remain confidential — for the most part.
Francois Beaulieu, acting chair of the board, issued an oral ruling Monday after a public interest hearing was held on the matter last week.
Irving Oil recently applied to the board to increase wholesale petroleum margins by 3.02 cents for furnace oil and 4.09 cents from motor fuels. The company has also asked for an interim increase of three cents for furnace oil and 3.5 cents for motor fuels while it awaits a full hearing.
In its application, Irving Oil redacted portions of its evidence, claiming it contained “proprietary, financial and/or commercially sensitive information” that needed to remain confidential.
“If the claim for confidentiality is denied, Irving Oil will not be in a position to submit sufficient evidence to make its case,” said Len Hoyt, the lawyer for Irving Oil, who noted it would make it difficult for any wholesaler or retailer to make any case for margin increases.
‘You Cannot Make An Economic Argument Without Providing Numbers’
But several interveners objected to the confidentiality claim by Irving Oil, arguing the amount of redacted information makes it hard for them to meaningfully participate in the process.
“In this case, in particular, I think that you cannot make an economic argument without providing numbers,” Abram Lutes, provincial coordinator of the Common Front for Social Justice, said Friday. “There needs to be some sort of numerical substantiation of these claims that can be examined.”
Lutes and other groups also argued that the onus to establish confidentiality rests with Irving Oil and that the company failed to provide sufficient reasons for its claims.
Beaulieu said the board was left to determine whether the information in question was confidential and whether publishing it is necessary in the interest of the public.
The Rules of Procedure for the EUB defines confidential information as “any personal, business, public security or operational information within the knowledge or possession of a person which is
accessible only by those authorized to have access, or any other information deemed by the board to be confidential in nature.”
According to Beaulieu, the board found the redacted information was consistent with the definition, with the exception of one line in the company’s application. The board ruled the sentence must be revealed, with the exception of the financial amount within it.
“Certain interveners and members of the public will not have access to the confidential versions of the evidence to which the claim applies,” he said. “The board is satisfied that the roles of the public intervener and board staff are sufficient to ensure that the public interest is served in this proceeding.”
Beaulieu went on to say that if the information was made freely available, participants in future proceedings “would be reluctant to provide certain key evidence that the board requires in order to make well-informed decisions.”
Wholesale Margins Review
In its application to increase wholesale margins, Irving Oil said there have been “substantial increases” in wholesale costs since the margins were last reviewed in 2012 and 2013.
“The wholesale costs which have increased include terminal fees, transportation and port fees, working capital management, overhead and compliance costs,” said the company.
But it is unknown how much those costs have increased as the figures are redacted from the company’s application.
Irving Oil said the increases are needed urgently because of “numerous challenges” in the petroleum industry, compounded by the COVID-19 pandemic, which jeopardize supply continuity in New Brunswick.
“It is important for the actual wholesale costs to be recovered in the wholesale margins because without cost recovery it will not make economic sense to continue to supply retailers where the wholesale cost increases exceed what can be recovered from retailers,” the company wrote.
“As the costs need to be ultimately recovered, it is necessary to provide for a reasonable opportunity of cost recovery to maintain a reliable supply chain.”
In detailing some of the petroleum industry challenges, Irving Oil pointed to price regulation in Atlantic Canada, new regulations for environmental and other compliance obligations, and reduced demand for refined products.
Follow
