Rate Stability Plan

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Rate Stability Plan

We’ve been working hard to stabilize power rates, while at the same time completing the most ambitious transition to renewable energy in Canada.

On March 7, 2016, Nova Scotia Power announced that it will not file a General Rate Application for the next three years. We are seeking only fuel cost adjustments at less than the projected rate of inflation through to the end of 2019.

For residential customers, this means rate increases of 1.5% – less than inflation – in each of 2017, 2018, and 2019. This equates to $2 per month for the average residential customer. Residential rates didn’t rise in 2015 and they went down this year.

How has Nova Scotia Power stabilized rates?

Customers have told us they want stable, predictable and affordable electricity pricing that they can depend on and budget around. Across Nova Scotia Power, we’ve been working toward that goal. Our investments in diverse electricity sources, prudent fuel procurement, and strict corporate cost control have allowed us to offer greater predictability and stability for our customers.

How much are rates changing?

The Rate Stability Plan would see power rates for all customers increase on average 1.3% – less than inflation – in each of 2017, 2018, and 2019. For most customers, rates didn’t rise in 2015 and they went down this year.

The proposed increases vary by customer class, largely due how much each class owes for unpaid costs for Efficiency Nova Scotia programming and fuel. This is particularly true for the Large General class of commercial customers.

   Previously set
 Included in today's filings
Customer Class
2015
 2016  2017  2018  2019
Residential 0%  -0.9%  1.5%  1.5% 1.5%
Small General  -4.5%   -2.2% 1.6%
1.6%
 1.6%
General Demand 0%  -1.3%  0.5%  0.5%   0.5%
Large General  1.5%   0%  3.7%  3.7%   3.7%
Small Industrial 0%  -1.8%  0.9%  0.9%   0.9%
Medium Industrial 1.5%  0%  1.5%  1.5%   1.5%
Large Industrial 1.5%  0%  1.4%  1.4%   1.4%

What’s the approval process?

Following through on a public commitment made by NSP President & CEO Bob Hanf on November 10, 2015, we have filed our Rate Stability Plan with our regulator, the Nova Scotia Utility and Review Board (UARB). If approved, the Rate Stability Plan would extend the period of stable, predictable electricity rates that began last year through to the end of 2019.

The UARB will conduct a full public hearing in June 2016, including testimony, customer advocates and thousands of pages of evidence. You can read Nova Scotia Power’s application here.

Why are rates increasing?

Broadly speaking, Nova Scotia Power’s expenses fall into two categories governed by two separate regulatory processes:

  • Fuel costs: The fuels used to generate electricity, such as coal and natural gas, as well as renewable energy contracts. By law, these costs are a direct flow-through to customers, meaning Nova Scotia Power does not make money off of fuel. Fuel costs are governed by the Fuel Adjustment Mechanism.
  •  Non-fuel costs: All other company costs, including labour, equipment and supplies. Non-fuel costs are set through General Rate Applications.

The Rate Stability Plan was submitted to the UARB under the Fuel Adjustment Mechanism. So, the cost changes in electricity are being driven by renewable energy contracts and fuel costs.

How does the Maritime Link factor into this?

The Rate Stability Plan includes integrating the first two years of Maritime Link costs into power rates. The Maritime Link is the subsea transmission line being constructed between Newfoundland and Cape Breton, which will deliver hydroelectricity from Muskrat Falls in Labrador. The Maritime Link is central to NSP’s plan to achieve its legislated requirement of generating 40% of electricity from renewable resources by 2020.

Nova Scotia Power achieved a new record in renewable energy in 2015, with 26.6% of the electricity coming from renewable resources – beating the legislated requirement of 25%. As recently as 2007, only 9% of Nova Scotia’s electricity was renewable. By 2020, NSP is required by law to be at 40% renewable, and to have cut greenhouse gas emissions by 25% compared to 2010.

“Nova Scotians have told us they want stable, predictable power rates, and our employees have done the hard work necessary to deliver them. We’ve accomplished this while at the same time achieving the most ambitious transition to renewable energy in Canada, and significantly cutting our greenhouse gas emissions.” – Bob Hanf, President and CEO of Nova Scotia Power 

On November 10, we held a press conference about our plan to stabilize rates. Please view the slide deck from the conference (Rate Stability Plan Slides). A full recording of the press conference is embedded below.


April 8, 2016

May 27, 2016