To provide you with more predictable power rates, we’ve worked with customer representatives to create a 2017-19 Rate Stability Plan. In each of the three years of the plan, residential electricity rates will increase by 1.7%. This increase goes directly towards paying for renewable energy contracts and the fuel used to generate electricity.
The increase is in keeping with, or slightly below, projected inflation for 2017 to 2019. For the average household, the increase equates to $2.10. That figure will vary based on an individual household’s electricity use. For example, larger homes with older appliances, or poor insulation, use more electricity, particularly during the winter months.
Power rates have been stable in Nova Scotia since 2014. Residential rates did not rise in 2015, and they went down slightly in 2016.
How has Nova Scotia Power stabilized rates?
We’ve been working hard to stabilize power rates, while at the same time completing the most ambitious transition to renewable energy in Canada. We’ve done this because 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 focused on 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 will see power rates for all customers increase on average 1.5% – slightly below projected inflation – in each of 2017, 2018, and 2019. For most customers, rates didn’t rise in 2015 and went down in 2016.
Rate changes in 2017 through 2019 will vary by customer class, largely due to 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.
Five years of rate stability
|Residential ||0% || -0.9% || 1.7% || 1.7% ||1.7% |
|Small General || -4.5% || -2.2% ||1.8% |
| 1.8% ||-0.3% |
|General Demand ||0% || -1.3% || 0.9% || 0.9% || 0.9% ||0.3% |
|Large General || 1.5% || 0% || 3.7% || 3.7% || 3.7% ||2.5% |
|Small Industrial ||0% || -1.8% || 1.2% || 1.2% || 1.2% || 0.4%|
|Medium Industrial ||1.5% || 0% || 1.6% || 1.6% || 1.6% ||1.3% |
|Large Industrial ||1.5% || 0% || 1.4% || 1.4% || 1.4% || 1.1%|
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.
Because cost changes in electricity are being driven by renewable energy contracts and fuel costs, the Rate Stability Plan was submitted to the Utility and Review Board for approval under the Fuel Adjustment Mechanism. Nova Scotia Power has committed to not file a General Rate Application in 2017 through 2019.
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.
In 2015 and 2016, we saved $36 million in fuel costs. A number of factors led to these savings, including Nova Scotia Power achieving favourable pricing on natural gas, oil and coal, as well as higher use of renewable generation, and decreased load due to winter conditions that were milder than anticipated.
We are able to refund these savings back to customers through a one-time credit that will be applied to their accounts by April 30, 2017. The refund amount will depend on the individual customer’s power usage in 2015 and 2016. Most residential customers will receive between $20 and $50.