NEW BRUNSWICK — A New Brunswick government regulation, written to protect pulp and paper mills from high electricity prices, is forcing N.B. Power to increase the rate subsidies it offers mills this year by 35%, despite a deterioration in the utility’s own financial condition. The mill subsidies, which have been mandated by the New Brunswick government every year since 2012, have been set by the Department of Energy for the current fiscal year at $28.04 per megawatt hour, an increase of $7.29 over last year. The utility had not originally budgeted to finance a subsidy that large and said it has revised the expected cost of the program for this year to $16.6 million — up by $2.9 million. …Pulp and paper companies have defended the program in the past as critical to their long-term viability. But since the program began, N.B. Power’s own financial viability has become an issue.