Nova Scotia’s power provider is asking for an average general rate increase for residential customers of 9.9 percent over three years, with possible additional costs due to severe weather and energy efficiency costs.
Nova Scotia Power’s increases for large industrial customers will be slightly more than 10 percent, while rates for small and medium-sized businesses will rise between 11 and just over 12 percent over the same three-year period.
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The base rate hikes are proposed to take effect in three phases, starting this August and then on January 1 for the next two years.
The application submitted to the province’s Utility and Review Council on Thursday also includes a request that the council create a mechanism to spread the cost of the province’s phasing out of coal – powered generation by 2030.
The accelerated depreciation cost for the closure of coal plants would be about $ 370 million, according to estimates provided to reporters on Thursday. However, it is possible that the aid program may apply to federal and provincial governments to help reduce those costs.
Peter Gregg, the company’s CEO, told reporters that the rate hikes and the deferral of the cost of moving to renewable energy – which he referred to as a “decarbonisation deferral bill” – were needed to help the company meet the largest transition in its history.
“We are taking a system that took us about 50 years to build, and the challenge will be to transform that system in less than 10 years,” he said.
Gregg said the tariff changes will help the company meet government-regulated targets for cleaner energy while meeting the growing demand from customers for electricity.
The details of how Nova Scotia Power will spread its “decolorization” program costs over time – and how and when it could affect tariffs – were not provided, but Gregg said shutting down coal plants “is a cost issue that needs to be addressed. ”
“We believe this (the deferral fund) is a solid solution to deal with any kind of rate shock,” he said.
Meanwhile, the potential cost of storm damage and an energy saving program will become separate lines in customers’ accounts if approved by the regulator.
In the event of storms, the utility will estimate the potential cost, but if extreme storms cause unforeseen damage, the power company will be able to apply to the regulator to recover those costs and it will be added to bills, Gregg said.
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The utility, a subsidiary of Halifax-based Emera Inc., is asking to retain its nine percent profit margin as part of its plan, with provision to enable it to earn up to 9.5 percent return on equity.
“We do not ask for more than we need to run a reliable business that our customers can rely on,” Gregg said.
The proposal also calls for a special fee for customers who generate their own power – from sources such as solar and wind – and sell it to the utility.
Gregg said this is because the utility continues to bear the cost of a reliable power source to customers who generate their own electricity. “It is a matter of justice.” “What we want to avoid is that customers who do not have the ability to generate their electricity cover the costs for customers who do have the ability to do so,” he said.
This report by The Canadian Press was first published on January 27, 2022.
© 2022 The Canadian Press
Reference-globalnews.ca