Topic:"Capital Expenditures" in M11990

1 M08984, Nova Scotia Power Inc., 2019 Annual Capital Expenditure Plan - Capital Expenditure Justification Criteria Documents, approved by the NSUARB in a letter dated April 16, 2020. M11536, Nova Scotia Power Inc., Pre-Tax Weighted Averag...

AI summary This document references two regulatory approvals related to Nova Scotia Power Inc.: the 2019 Annual Capital Expenditure Plan and the Pre-Tax Weighted Average Cost of Capital (WACC) and Allowance for Funds Used During Construction (AFUDC) Rates, both approved by the NSUARB in 2020 and 2024 respectively.

2025 Budget (1) (2) (3) (4) (5) Proposed Rates Actual Interest Projected Interest Weighted Average Interest Total Interest 2025 Rate Rates Rate Cost Capitalization: Debt % 60.0% Common % 40.0% Total Regulated Capitalization ($): $6,002 Fin...

AI summary The 2025 Budget outlines the proposed capitalization structure, financial ratios, and details of debt for the entity. It includes a breakdown of short-term and long-term debt, interest rates, and total interest costs. The debt composition includes multiple series with varying maturity dates and interest rates, along with forecasted issuance from the Canada Infrastructure Bank.

NON-CONFIDENTIAL 1 Request IR-1: 2 3 Please refer to page 3, lines 20 through 27, of the Application dated November 28, 2024 and 4 provide: 5 6 (a) An estimate of the average AFUDC balance and the total forecast AFUDC to be 7 capitalized i...

AI summary The document outlines responses to a request regarding financial estimates for Nova Scotia Power. It includes the average balance of construction work in progress (CWIP), total AFUDC capitalized, non-capital deferrals, and the impact of adjusting the approved rate on finance expenses.

1 Request IR-3: 2 3 Please refer to page 1 of Appendix A of the Application dated November 28, 2024. 4 5 (a) With reference to the average capitalization of $5.683 billion shown at row 13 please 6 quantify what portion of the $5.683 billio...

AI summary The document requests quantification of how the average capitalization of $5.683 billion is allocated across various categories, including net plant in service, construction work in progress, non-capital deferrals, working capital, and other items.

20 Please refer to the average forecast balances shown in the table below. 2025 Budget 2025 Budget 2025 Budget $ Millions Opening Balance Ending Balance Average Balance Net Regulated Plant in Service 4,700 5,097 4,898 Plus: Construction Wo...

AI summary The text refers to average forecast balances for 2025, including Net Regulated Plant in Service, Construction Work in Progress, Net Utility Fixed Assets, and other financial metrics, providing a snapshot of projected financial positions.

13 14 (c) NS Power estimates deferred financing costs in 2024 would decrease by approximately $9 15 thousand as a result of applying the updated WACC/AFUDC rate. The rounded WACC 16 rate would decrease from 6.66 percent to 6.65 percent. 17...

AI summary NS Power estimates deferred financing costs in 2024 will decrease due to an updated WACC/AFUDC rate. The use of the Bloomberg Outlook consensus rate improves efficiency and accuracy in forecasting interest rates for Canadian Treasury Bills.

1 analysts from a greater number of banks (11 vs. 5) which should increase the robustness of 17 18 Response IR-4: 19 20 (a) NS Power applied ASC 480, Distinguishing Liabilities from Equity, to determine the 21 appropriate accounting treatm...

AI summary NS Power applied ASC 480 to account for WMA preferred shares as a liability due to their mandatory redemption feature. This decision was supported by external auditors and did not impact equity thickness or the WACC/AFUDC rate calculation during the 2013-2014 General Rate Application proceeding.

Nova Scotia Power Inc. FOR-10 Estimated Average Capital and Cost of Capital Year Ended December 31st Thousands of Dollars

AI summary Nova Scotia Power Inc. submitted a FOR-10 document outlining estimated average capital and cost of capital for the year ended December 31st, with figures presented in thousands of dollars.

2025 Budget 1 (1) Proposed Projected Weighted (1) 2 Rates 2025 Actual Interest Rate Interest Rates Average Interest Rate Total Interest Cost 3 Capitalization: 4 Debt % 60.0% 5 Common % 40.0% 6 Total Regulated Capitalization ($): $6,002 7 8...

AI summary The 2025 Budget outlines NSP's capitalization structure, including 60% debt and 40% common equity, with total regulated capitalization of $6,002. It provides details on short-term and long-term debt, interest rates, and projected interest costs, including various debt series with maturity dates and rates.

PARTIALLY CONFIDENTIAL (Attachment Only) 1 Request IR-6: 2 3 (a) Please provide a schedule detailing the projected opening and closing balances of 4 construction work in progress for 2025, to which the proposed AFUDC rate is 5 expected to...

AI summary The document outlines a request for information regarding NS Power's projected construction work in progress balances and AFUDC charges for 2025, as well as its equity ratios for 2024 and 2025. NS Power provides some details but notes it cannot disclose actual capital structure data until its 2024 Regulated Financial Statements are completed.

WACC and AFUDC Rates for 2025 Application (NSUARB M11990) NSPI Responses to NSUARB Information Requests 1 Request IR-9: 2 3 In reference to Appendix A page 2, Capital Structure and Ratios, Long-Term 4 5 (a) Why isn't a value provided in Co...

AI summary NSPI explains that the Series F long-term debt is forecast to be repaid upon maturity on May 19, 2025, which is why no value is provided for it in Column (1) of Appendix A. The increase in deferred financing charges from $1.4 million to $1.8 million is attributed to the maturity of Series F, which will cease bond premium amortization income, thereby increasing these charges.

Financial Outlook NSPI's key credit metrics strengthened in the last 12 months ended September 30, 2024 (LTM 2024), because of the stronger earnings and cash flows, and the reduction in debt following the sale of the $117 million balance i...

AI summary NSPI's credit metrics improved in LTM 2024 due to stronger earnings, cash flows, and debt reduction from FAM sale to the Province. Further strengthening is expected from NSPML's $500 million transfer. NSPI plans $630M annual capex for network reliability and growth, aiming to maintain BBB credit ratings. Emera Inc. supports NSPI through flexible dividends and equity injections.

Credit Highlights The provincial government of Nova Scotia recently proposed to compensate Nova Scotia Power Inc. (NSPI) about $117 million to offset the deferred fuel cost liability. NSPI generally recovers the incurred fuel cost from cus...

AI summary Nova Scotia's government proposed a $117 million compensation to NSPI to offset deferred fuel costs, which would otherwise increase customer bills. NSPI was fined $10 million for non-compliance with the Renewable Electricity Regulations (RER) and faces challenges in meeting renewable energy targets, requiring significant investments and potential government support.

thermore, the government support also decreases the rate impact on customers by spreading out the recovery over a longer period (10 years for the provincial funding and 28 years for the federal loan). We project Emera's financial measures...

AI summary Emera's financial risk profile is assessed as aggressive but improving, with FFO-to-debt ratios projected to remain above 10% through 2026. Capital spending of C$20 billion (2025-2029) focuses on Florida grid reliability and renewables, funded by internal cash flow, equity, and debt. Dividend growth moderation balances capital plans, while regulatory risk benchmarks reflect lower volatility compared to corporate issuers.

Outlook - Tampa Electric Co. The stable outlook on TEC reflects the stable outlook of its parent Emera. The outlook also reflects our view that with the recent base rate outcome and assumed equity issuances to fund the robust capital spend...

AI summary TEC's stable outlook is tied to its parent Emera and projected FFO to debt ratios of 18%-19% through 2026, assuming equity issuances to fund capital spending. The outlook also considers recent base rate outcomes.

Assumptions - Implementation of the multi-year rate increases at TEC. - No adverse weather beyond our base-case expectations. We assume deferred costs incurred in 2024 related to Hurricane Milton and Hurricane Helene will be recovered by t...

AI summary The assumptions section outlines key factors including multi-year rate increases at TEC, no unexpected adverse weather impacts, C$3.5-4.0B annual capital spending (2025-2026), C$600M annual dividends, negative discretionary cash flow, and assumed sale proceeds from New Mexico gas in 2025.

Principal liquidity uses - Debt maturities of C$870 million over the next 12 months. Including outstanding amounts under the commercial program as of Sept. 30, 2024; - Capital spending of about C$3.3 billion; and - Dividends of roughly C$5...

AI summary The principal liquidity uses include debt maturities of C$870 million, capital spending of C$3.3 billion, and dividends of C$575 million over the next 12 months, with outstanding commercial program amounts as of Sept. 30, 2024.

2025 Budget 1 (1) (2) (3) (4) (5) (6) (7) (8) 2 2025 Cost Cost Weighted Weighted Average Capital Pre-tax After-tax Pre-tax After-tax 3 Opening Closing Capital Ratio Factor Factor Cost Cost 4 5 Estimated Cost of Capital 6 7 Short-term debt...

AI summary The 2025 Budget outlines the estimated cost of capital for short-term and long-term debt, as well as common equity, with details on pre-tax and after-tax costs, weighted averages, and capital ratios. This information is critical for evaluating financial strategies and capital structure.

2025 Budget 1 (1) (1) Proposed Projected Weighted 2 Rates 2025 Actual Interest Rate Interest Rates Average Interest Rate Total Interest Cost 3 Capitalization: 4 Debt % 60.0% 5 Common % 40.0% 6 Total Regulated Capitalization ($): $6,002 7 8...

AI summary This section outlines the 2025 budget proposal, focusing on regulated capitalization, financial ratios, and debt details. It provides breakdowns of short-term and long-term debt, including maturity dates, interest rates, and projected interest costs, with an emphasis on the capital structure and financial obligations for the year.

February 12, 2025 VIA EMAIL Ms. Crystal Henwood Regulatory Affairs Officer/Clerk Nova Scotia Utility and Review Board 1601 Lower Water Street, 3rd Floor Halifax NS B3J 3S3 Dear Ms. Henwood: Re: M11990 - Nova Scotia Power Inc. (NSPI) - 2025...

AI summary The Small Business Advocate (SBA) reviewed Nova Scotia Power Inc.'s (NSPI) 2025 WACC and AFUDC rate application, noting the rate decrease from 6.72% to 6.66% but expressing concern about potential reversals of favorable factors. NSPI explained a 2023 credit rating downgrade from DBRS and S&P Global, leading to elevated credit spreads and reliance on Commercial Paper (CP) for funding. Maintaining credit metrics is critical to sustain CP market access.