Nova Scotia Power Seeks Approval to Securitise Up to $1 Billion in Costs
Nova Scotia Power has applied to the Nova Scotia Energy Board to securitise up to $1 billion in eligible costs, including coal plant retirements and a new system operator. The plan aims to save customers roughly $265 million over 30 years but would add a 2.9% rider to residential bills starting in 2027.
Nova Scotia Power has filed an application with the Nova Scotia Energy Board to finance up to $1 billion in eligible costs through securitization. The filing follows the Province of Nova Scotia’s passage of new regulations under the Public Utilities Act that allow the utility to seek approval for securitizing its assets.
Eligible costs under the application include the remaining value of coal-related assets, fuel used for electricity generation, expenses to establish the Nova Scotia Independent Energy System Operator, and other deferred costs. Nova Scotia Power previously estimated unrecovered coal plant assets at around $704 million but increased the figure to $1 billion in its securitization application. The utility is required to phase out and close its coal-fired electric power plants by 2030 due to federal and provincial clean energy regulations.
Under the current regulatory framework without securitization, Nova Scotians pay the full cost of assets plus an interest rate calculated at around seven per cent. The proposed securitization framework is expected to lower borrowing costs and spread repayment over 30 years, saving customers approximately $265 million over the full repayment period compared to standard financing.
If approved, the debt would be repaid through a separate line item, or rider, on power bills starting in 2027. For residential customers, the rider would add 2.9%. Combined with a previously approved 3.9% rate increase, residential customers would face a total 6.8% rise in 2027. Across all customer groups, the new rider would average 3.3%.
A 60-day review process by the Nova Scotia Energy Board will begin following the announcement of the new regulations, with an order required within that timeframe. Nova Scotia Power serves approximately 550,000 customers and employs about 2,200 people.