N-52024-2025 Bates White FAM Audit Report - Redacted
16 passages
VI.B.7. New Biomass Supply Agreements during the Audit Period During the Audit Period, NSPI entered into several new contracts for solid fuel supply. We reviewed each of these contracts and the process by which those contracts were execute...
AI summary During the Audit Period, NSPI signed new solid fuel supply contracts. The audit highlights increased forecasted output from PHB in 2025 and 2026, which influenced higher procurement targets. The review includes how suppliers were selected and the rationale for seeking additional supply.
rm its obligations in accordance with "reasonable Industry Standards," which NSPI stated are generally understood to reflect the practices and performance expected under ordinary operating conditions. The contract language does not explici...
AI summary The text discusses NSPI's obligations under biomass fuel contracts, emphasizing that NSPI is not responsible for incremental costs from fuel management but must cooperate in consuming or removing fuel. NSPI has implemented inventory management improvements to prevent future incidents.
VII.B.2. Audit Period Gas Transportation Options Considered by NSPI Natural gas is a commodity, and if pipeline access to gas is available, then contracting for the gas commodity is straightforward. It is more complex to contract for FT ca...
AI summary NSPI considered various gas transportation options during the audit period, including accepting assignments of FT capacity and using IT. In Canada, FT rates are lower than IT rates, while in the U.S., IT capacity was sometimes available at a discount to FT rates. NSPI extended its FT contract on M&NE-CA through 2026, and NSPEMI occasionally contracted for discounted M&NE-US capacity.
The MN365 FT Contract With the advent of the MMBtu per day firm gas supply from Alberta, NSPI sought to match it with an MN365 FT contract on M&NE-CA because there was little doubt that this gas would be used by NSPI every day. This contra...
AI summary NSPI entered into an MN365 FT contract on M&NE-CA to match a daily MMBtu gas supply from Alberta, with flexibility to sell unused gas in NB/NS markets. The contract was renewed for 2024-2025 and extended to 2026, with a decision on 2027 deferred. Analysis showed declining utilization of FT capacity, leading to cumulative losses, prompting NSPI to conclude the capacity would be uneconomic.
VII.B.3. Bates White's 2022-2023 Recommendations In our report for the prior Audit Period, we included three recommendations regarding natural gas supply planning. The first recommendation read: Recommendation VII-1: On an annual basis, NS...
AI summary Bates White's 2022-2023 recommendations include a call for NSPI to annually quantify the optimal mix of short-term and long-term FT pipeline contracts and delivered gas supplies for FAM customers, including risk mitigation strategies. NSPI accepted the recommendation but did not clarify the term of the analysis, leading to the recommendation being considered unaddressed.
Figure X-4: Net Capacity Factors, NSPI Generating Units 391 Thermal Plant 2024 Capacity 2025 Capacity Factor Factor Trenton 5 21.03% 29.22% Trenton 6 43.14% 55.10% Point Tupper 42.85% 52.54% Tufts Cove 1 60.36% 18.85% Tufts Cove 2 49.32% 4...
AI summary Figure X-4 shows a decline in the capacity factors of NSPI's thermal generating units from 2024 to 2025, with most units below 50%. Coal-fired generators saw increased capacity factors in 2025 due to the sulfur emissions compliance CoV received in March 2025, while natural gas units at Tufts Cove experienced a decline.
391 2024 FAM Annual Report A-2; 2025 FAM Annual Report A-2. 392 2014-2015 Liberty FAM Audit Report, page VIII-12. Figure X-5 compares Audit Period capacity factors across the thermal units, renewable units, and total fleet to recent histor...
AI summary This text discusses the performance of energy generation units during the Audit Period, noting that thermal and wind capacity factors rebounded after declines in previous years, while hydroelectric output was significantly below historical averages due to weather patterns and outages. Precipitation levels in Halifax also dropped during the Audit Period.
Figure X-6: Thermal Units' Average Load (MW) 395 Thermal Plant Max Net Capacity Average Load 2024 (MW) Average Load 2025 (MW) Lingan 1 153 86 106 Lingan 2 153 76 46 Lingan 3 148 84 104 Lingan 4 153 82 94 Tufts Cove 1 78 68 34 Tufts Cove 2...
AI summary The text presents data on the average load of various thermal units in Nova Scotia from 2024 to 2025, highlighting the performance of different power plants. It also discusses the economic minimum dispatch levels of these units, indicating how often they were operated at or below this level, which is unusual for baseload units.
Figure X-15: 2025 Utilization Factors (Actual vs. Forecast)428 Unit Starts Net Capacity Factor Operating Hours UF Actual UF Forecast Lingan 1 20 52% 6,544 High Medium Lingan 2 5 19% 2,516 Medium - Lingan 3 22 48% 6,046 High Medium Lingan 4...
AI summary Figure X-15 compares actual and forecast utilization factors for various units in 2025, showing discrepancies in performance across different facilities. The section highlights unit-specific issues identified during the audit period, emphasizing the need for analysis of operational data and capacity factors.
X.B.3.c.i. Performance During Audit Period NSPI's seven 33 MW combustion turbines' performance during the Audit Period saw, in some cases, elevated DAFORs in 2024. Performance improved considerably in 2025, as is shown in Figure X-20 below...
AI summary NSPI's combustion turbines showed elevated DAFORs in 2024 but improved in 2025. Availability factors were generally positive, though DAFORs were lower than industry averages. NSPI attributes lower capacity factors to elevated DAFORs.
X.B.3.d.ii. Status and Operation of Lingan 2 The Board considered the issue of the retirement of Lingan 2 and its relation to the commencement of the NS Block volumes in a February 8, 2022 Decision.446 The Board noted that in NSPI's integr...
AI summary The Board addressed the retirement of Lingan 2 in a February 2022 decision, noting that NSPI planned to keep the unit operational until one year after the NS Block commenced. The Board disallowed recovery of Lingan 2 operating costs beyond August 15, 2022, without further approval. NSPI phased out economic dispatch after that date but kept the unit in cold reserve. The IESO forecasts Lingan 2's retirement until 2029/2030, requiring NSPI to maintain the unit for 2-3 additional years.
3 failed starts out of 145 attempts, a failure rate of 9.0%. Unit 1, which operated following completion of its LEM work, experienced just two failed starts out of 49 attempts, a failure rate of 4.1%. Had NSPI completed the LEM work on Uni...
AI summary NSPI's Unit 1 had a lower failure rate after LEM work, while Unit 2's delay impacted FAM customers. NSPI did not track the cost of delays, but estimates suggest potential lost generation and revenue due to the delay. Hydrological conditions and the Federal Loan Guarantee are noted as factors affecting these estimates.
ere derated decreased 19 percent from the prior audit period, though the size of the average derate increased by 8 MW (or 11.8%), as did the average duration of the derates (by 59 hours, or by 88.2%). Conclusion X-8: Heat rate performance...
AI summary The audit period saw a 19% decrease in derated capacity, with increased average derate size and duration. NSPI's heat rate performance improved in 2025, with five coal-fired units exceeding industry averages. Utilization factors were higher than forecast, indicating potential increases in capital and O&M costs. NSPI's asset management and outage planning remain effective.
XI.B.3. The Port Hawkesbury Biomass Generator NSPI jointly optimizes PT Biomass with the other units in its portfolio using PortOps. The PT Biomass unit is included in the day ahead and intra-day schedules, and in the merit order dispatch...
AI summary The Port Hawkesbury Biomass Generator (PT Biomass) is jointly optimized with other units by NSPI using PortOps. It is included in day-ahead and intra-day schedules and is subject to real-time redispatching by NSPSO for various operational reasons. The capacity of PT Biomass is estimated and affected by steam usage by PH Paper, with average output levels provided for 2024 and 2025.
XI.B.7. Out-of-Merit Dispatch of Solid Fuel Units In many hours during 2024, all the solid fuel units (Lingan, Pt Aconi, Pt Tupper, and Trenton) were scheduled out-of-merit. This largely coincides with the period that the SO 2 adder was in...
AI summary In 2024, solid fuel units were frequently scheduled out-of-merit, coinciding with the inclusion of SO2 adders in marginal cost equations. This led to discrepancies between unit marginal costs and day-ahead system marginal costs, suggesting that the day-ahead system marginal costs may have been understated.
rely on any of that 153 MW toward its planning reserve at all, considering its experience in October 2021 when the Labrador Island Link's unavailability meant zero MWhs flowed during the 31-day month. Moreover, once the Labrador Island Lin...
AI summary The document discusses NSPI's disagreement with an assessment that FAM customers are deprived of long-term capacity value due to undelivered NS Block quantities. NSPI argues that the current delivery of the NS Block meets capacity standards, but the opposing view emphasizes the unavailability of promised capacity until the Labrador Island Link is fully commissioned.