Senior members of the Canada Infrastructure Bank (CIB) appeared before a House committee Thursday to defend their decision to issue a $206 million loan to the Mersey River Wind project in Nova Scotia.

Opposition MPs, including Conservatives and Bloc Québécois, launched a self-initiated and at times abrasive probe into allegations that some key people involved in the project are connected to the Liberals.

They point to some of the leaders of Renewall Energy, the electricity utility company handling the project, being related to former Liberal MPs, and to former provincial interim Liberal leader Michel Samson, who left politics in 2017 and is on the board of directors.

CIB’s counsel, Frédéric Duguay, said the bank did its due diligence, and followed guidelines for people who have previously held public office. 

He mentioned Canada’s financial intelligence unit provides guidance that often includes a “look-back” period of five years. 

“With respect to these individuals, the public office that was held was more than the five-year look-back guidelines, and that’s a factor that we assess as part of a risk assessment,” he said. 

The head of the CIB, Ehren Cory, added there had also been due diligence around the conflict of interest check – with no conflicts for anyone involved in the transaction. 

Bloc Québécois MP Xavier Barsalou-Duval pointed to Renewall’s lobbying efforts in Ottawa, which include logged meetings with MPs and senior government officials.

“I can confirm none of those meetings involved the CIB or have anything to do with us,” said Cory. “We provided a loan based on the merits of the project.”

The CIB can’t disclose specific negotiated terms, but Cory said Mersey River Wind obtained an interest rate that aligns with the market for similar large scale renewable energy projects.

The project is set to become the first to run a renewables to retail program in Nova Scotia, letting customers buy power directly from the developer instead of the traditional utility-owned model. 

Cory said the loan was designed to help manage some of the risk that comes with that.

“If they have a slower time signing up customers, imagine then our repayment might take a little longer, and that’s the kind of flexibility with taxpayer money. That’s why the CIB exists.”

Mersey River Wind is a $500 million project that involves 33 wind turbines generating 150 megawatts.

It could come online by 2027, effectively breaking Nova Scotia Power’s monopoly on the electricity market. 

That company has increased power rates for many consecutive years, including a recent request for an eight per cent increase in residential rates.

The Nova Scotia Energy Board has agreed to an increase, but has asked Nova Scotia Power to come back with new proposals to lower the hike, without citing a specific number. 

Progressive-Conservative Premier Tim Houston slammed the increase in power costs and said the regulator’s decision reinforced “the best path forward is more choice, more competition and less reliance” on the company. 

He added the Mersey River Wind project will “provide a real alternative to Nova Scotia Power.”