The Tim Houston PC Government has introduced legislation to protect the pockets of Nova Scotians from a significant general rate increase by Nova Scotia Power.
This new PC bill will require the Nova Scotia Utility and Review Board (NSUARB), which is responsible for setting rates electric utilities can charge customers, to not approve an increase based on the utility's costs except those for fuel and improving reliability of the grid. Any increases related to reliability cannot be more than 1.8 per cent over the next two years.
Under this bill, NS Power will not be allowed to pass along most cost increases for operations and maintenance.
Other amendments address the utility's profits:
- the NSUARB cannot set the utility's rate of return on equity any higher than 9.25 per cent; Nova Scotia Power asked for up to 9.5 per cent in its general rate application
- the NSUARB cannot set the utility's equity ratio any higher than 40 per cent; the utility asked for 45 per cent
- any excess profits above the amount approved by the NSUARB will continue to be returned in full to ratepayers; the utility has asked to keep half
- the NSUARB must set a rate of return on equity for each class of assets, rather setting one rate for all assets as a whole
- financing for any deferred cost is limited to the current Bank of Canada policy rate plus 1.75 per cent; the utility cannot earn a profit by financing it themselves at a higher rate.
It is expected the NSUARB will make a decision on the general rate application before the end of December. The Houston PC Government will continue to look for solutions to further reduce fuel costs and explore further action to support ratepayers.