Nova Scotia Power seeks to delay public hearings on proposed 10% rate hike

Nova Scotia Power has asked to delay public hearings on its proposed 10 per cent general rate increase so it can continue talks with the provincial government on "solutions" to mitigate the impact of rising fuel costs on rates.

The company was facing a Friday deadline to update its fuel forecast ahead of regulatory hearings scheduled to start Sept. 7. Fuel costs are automatically rolled into rates on a yearly basis.

The Nova Scotia Utility and Review Board wanted the fuel forecast update to reflect current market conditions. The company says the fuel cost estimates used for the general rate application were generated in May 2021.

"Fuel and purchased power costs have risen significantly since May 2021," NSP told the Nova Scotia Utility and Review Board in an Aug. 10 letter requesting an extension. It wants to delay its fuel update by two weeks — to Sept. 2 — and to push the start of hearings back five days to Sept. 12.

Province seeking 'further immediate discussions'

In its letter NSP disclosed that it is currently in talks with the Department of Natural Resources and Renewables over the issue.

"The province is seeking to have further immediate discussions with NS Power on the nature and extent of the fuel and purchased power costs increases in an attempt to lessen the impact on customers by mitigating fuel related costs that would otherwise be included in the fuel update," NSP said.

Nova Scotia Power spokesperson Mina Atia said the company is facing  "unprecedented increases in the cost of fuel."

"We have been working to mitigate these costs wherever we can and have analysis underway to understand additional options that could lessen the impact on our customers,." Atia said in a  statement to CBC News.

"We know this is a significant concern for Nova Scotians and it is a concern for us as well.  We made this request to give us more time to work with stakeholders, including the provincial government, so that we can work together to find solutions."

Natural Resources and Renewables deputy minister Karen Gatien filed a letter "in full support" of the extension, saying since the company filed its rate application in January "there have been unprecedented global increases in fuel costs which will have a direct impact on electricity rates in Nova Scotia."

"The province is committed to continuing that engagement and to examining and assessing every reasonable opportunity that may lessen the impact of increased fuel costs." Gatien wrote on Aug. 10.

The Department of Natural Resources declined an interview on Monday.

"While we agree that a delay isn't ideal, we can support it in order to have a decision based on all the facts. This slight delay will also give us and Nova Scotia Power time to look at all the possible ways to lessen the impact of fuel costs and other pressures on power rates," spokesperson Adele Poirier said in a statement.

In a filing with regulators on Monday, the Department of Resources and Renewable defended its request to delay saying more time is needed to "successfully  complete" talks on fuel cost.

"These would be important conversations at any time; however, given the current affordability challenges that all Nova Scotians are facing, these discussions and their outcome are critical," lawyer Catherine Lunn said on behalf of the Department

Neither Nova Scotia Power nor the province said what solutions are being examined or what it would cost.

Ratepayer groups respond

Lawyers representing various Nova Scotia Power customer groups are responding.

"In light of the anticipated rate impacts and material fuel cost increases, it would be in the interest of all customers to support the government's timely efforts and requested extension to file NSPI's fuels update," said Nancy Rubin on behalf of industrial customers.

Consumer advocate Bill Mahody, representing NSP's 400,000 residential customers, welcomed the province's direct involvement but said NSP should be held to the original timeline.

If the extension's granted, the updated fuel forecast would be released after the company releases its rebuttal to evidence filed by consumer groups.

"That rebuttal testimony should be based on the most recent data available, including dramatically increasing fuel-related costs," Mahody wrote.

Small business advocate Nelson Blackburn questioned the need for a delay.

"It is unclear why the public release of the fuel update would limit the ability of the government and/or NSPI to develop ways to mitigate the cost of fuel going forward," he said.

"There is also the question of whether there is any guarantee that the additional time will result in any practical difference to the fuel update."