Month of hearings begin on Nova Scotia Power's request for hefty rate increase

Hearings opened Monday in Halifax into Nova Scotia Power's request for an 11.6 per cent rate increase over the next two years.

Nova Scotia Power president Peter Gregg said the privately owned company is merely asking its regulator, the Nova Scotia Utility and Review Board, for what it needs.

"What we put in this application is what we believe is necessary to get us off coal by 2030 and to continue to service our customers reliably," Gregg told reporters ahead of the hearing.

"Ultimately what comes out of this process at the end, what the UARB approves in terms of rates is the board's decision."

The company is looking to include automatic charges to pay for future storm damage and to fund the cost of retiring its coal plants.

Nova Scotia Power is asking to increase the upper end of its rate of return from 9.25 to 9.5 per cent.  

It is also asking for an "earnings sharing mechanism" that would give the company half of all profits earned above its regulated rate of return. All excess earnings are currently returned to customers.

Neither Gregg, nor Scott Balfour, CEO of parent company Emera, would discuss its moves to increase profitability.

"I'm not going to get into those details here. I'm not here for that today," Balfour told reporters outside the hearing.

The company has said it is requesting a deal similar to those of other regulated utilities.

Over the next two years, the money Nova Scotia Power spends on fuel to generate electricity or buy power is forecast to be nearly $700 million more than earlier estimates.

Bill Mahody, a consumer advocate for Nova Scotia Power's residential customers, said the company's future fuel costs will make bills go up, even if it's put off until later.

"There are substantial fuel costs that ratepayers are going to be responsible for down the road. Can they be predicted to the penny? No, they cannot be," Mahody told reporters.

"But is there good information available to the company now that's been filed in this hearing that shows that in 2023 and 2024 we're going to have substantial fuel increase? Absolutely, there is."

Nova Scotia opposition party leaders slammed the application for the rate increase.

"They're asking for this unprecedented rate increase based on the arguments that the transition to clean energy will impact their bottom line," said Nova Scotia Liberal Leader Zach Churchill. "But the reality is that over half of this rate application is intended to dramatically increase profits with no consideration of the impacts to Nova Scotians."

Nova Scotia NDP Leader Claudia Chender said Nova Scotia Power wants people to pay more while increasing their corporate profits.

"Nova Scotia Power wants to be able to claw back half of excess profits instead of returning them back to customers for much needed relief, as is the current practice," Chender said.

The hearings are expected to take the entire month.