Mi'kma'ki / Nova Scotia – Yesterday the Nova Scotia government introduced amendments to the Public Utilities Act that place new restrictions on Nova Scotia Power (NSP) in relation to residential rate increases, returns on equity (ROE) and returns on investment (ROI). The Ecology Action Centre is pleased to see government acting to address energy affordability, but worries that the amendments may only affect rates for the short term and hinder NSP’s ability to transition to long-term, affordable clean energy solutions.
“Energy poverty is a huge issue for Nova Scotians and their families,” says Jacob Thompson, energy coordinator with EAC. “We need to ensure that we are looking at the long term and investing in clean, reliable and affordable energy solutions. These amendments will help decrease rates now, but we worry that they may result in higher prices in the long run by restricting NSP’s ability to invest in renewables like wind and solar, which are not exposed to cost fluctuations and expected increases experienced by fossil fuels.”
The amendments would limit rate increases to 1.8 per cent over the next two years (as opposed to NSP’s proposed 11 per cent for residential customers and 16 - 17 per cent for industrial customers), limit ROE to no more than 9.1 per cent and require that NSP continue to transfer all returns on investment in excess of this number to rate payers (as opposed to NSP's proposed 50/50 split). Without a clear provincial climate plan and information on where money to invest in a transition to clean energy will come from, Thompson worries these restrictions may hinder Nova Scotia’s overall ability to meet its climate goals.
“We have some of the most ambitious climate goals in the country,” says Thompson. “We need more information from the government on how they plan to ensure that these new restrictions won’t delay our ability to meet those goals. Right now we don’t have that, and this is a huge concern.”
Overall, Thompson says that the solution to energy affordability and a transition to clean energy lies in making sure we are addressing the root causes of the issue by looking at the relationship between rates, spending on things like energy efficiency and what this will mean for the actual energy bills that Nova Scotians pay.
“When thinking about energy affordability, we need to make sure that we’re not just looking at rates,” says Thompson. “If we’re investing in demand side management efforts like support for efficiency programs for low- and medium-income Nova Scotians, even though energy rates might increase, overall energy costs per household will go down. We need to make sure we’re addressing the root causes when dealing with energy affordability and not just the symptoms. Nova Scotians and their families deserve a plan to deal with the climate emergency and energy affordability in the long term, and unfortunately the government has not provided that.”