Nova Scotia Power customers to foot $24M in storm recovery costs
Nova Scotia Power customers are in for a rate increase next year to cover the costs of dealing with storms in 2023. The Nova Scotia Utility and Review Board has given Nova Scotia Power the green light to charge ratepayers $24 million starting in January 2025 through a storm cost-recovery rider mechanism. This decision will lead to an average rate increase of about 1.4 per cent, varying depending on the customer.
In 2023, there were six severe storms that qualified for cost recovery, including post-tropical storm Lee, which caused power outages for nearly a third of Nova Scotia Power customers when it hit the province in September. Another named storm included in the rider is post-tropical storm Philippe, which was forecasted to be a significant wind and rain event but weakened before reaching Nova Scotia. Despite this, Nova Scotia Power spent approximately $1.9 million on emergency preparations for Philippe.
The utility had a base rate of $10.2 million for storm operating costs in 2023 and spent an additional $21.8 million on restoration efforts, exceeding the base rate. This, along with $2.2 million in financing costs, contributed to the decision for storm cost recovery.
A breakdown of spending by Nova Scotia Power revealed that most of the funds went towards contracts with external companies, followed by overtime labor, meals, travel, and repair materials, among other expenses.
Apart from storm cost recovery, there will be another rate increase in Nova Scotia next year. Recently, the board approved an application from Nova Scotia Power to accept a $50 million loan guarantee from the federal government. This move will prevent a nearly 20 per cent rate hike but is expected to result in an average rate increase of 2.4 per cent.
These developments highlight the financial challenges faced by Nova Scotia Power in dealing with storm-related costs and the measures being taken to mitigate the impact on customers. Stay informed about these changes in power rates to better manage your budget and energy consumption.
