Topic:"Cost Considerations" in M12412

7 As noted in the Notice of Application, while the NSIESO is forecast to incur costs of $7.98M for 8 the period ending March 31, 2026, it is not seeking approval of total costs. NSIESO has the benefit 9 of Provincial funding in the amount...

AI summary The NSIESO is seeking approval for ongoing OM&A costs of $6.75M and the recording of $5.31M in a deferral account. It notes that one-time transition costs are fully funded by the province and that internal labour costs are allocated to specific categories.

21 H. Finance ($0.16M) - 22 The NSIESO is forecasting $0.16M in ongoing expenses as part of the Finance cost category. This - 23 cost category primarily consists of costs incurred in respect of financial services other than - 24 insurance...

AI summary The NSIESO is forecasting $0.16M in ongoing expenses under the Finance cost category, which includes financial services costs excluding insurance, covered within the Corporation Administration Cost Category.

20 C. Accounting Set-Up and Bookkeeping ($0.02M) - 21 These costs are to set up the NSIESO's financial operations, including designing and implementing - 22 the systems and processes through which financial data is collected, analyzed, and...

AI summary The costs outlined are for setting up the NSIESO's financial operations, including the design and implementation of systems and processes for collecting, analyzing, and communicating financial data within the organization, as well as monthly processing.

15 Table 16: Net OM&A Deferral and Variance Account – Sub-Accounts Sub-Account Name Description of recorded funds Net Ongoing OM&A Deferral Account, Sub Account No. 1 Records the approved forecast Net Ongoing OM&A costs for the period endi...

AI summary The document describes three sub-accounts related to the Net OM&A Deferral and Variance Account. These accounts track forecasted, actual, and variance expenses for the NSIESO. The NSIESO has not yet proposed a mechanism for rate recovery.

For ease of reference, IESO Nova Scotia seeks to add additional background to the following table found in Exhibit B-2: Cost Category Gross Ongoing OM&A Forecast ($) Corporate Administration 0.23M Directors Errors and Omissions Insurance 0...

AI summary IESO Nova Scotia provides additional background on the budget items in Exhibit B-2, noting that formal quotes were not obtained for the listed costs, and instead, informal inquiries were made to estimate expenses for budgeting purposes.

April 1 2025 - March 31, 2026 Apr-25 May-25 Jun-25 Jul-25 Aug-25 Sep-25 Oct-25 Nov-25 Dec-25 Jan-26 Feb-26 Mar-26 2026 Expense Category Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast Fore...

AI summary The document outlines a detailed forecast of expenses from April 1, 2025, to March 31, 2026, covering various expense categories such as employees, corporate administration, legal and regulatory costs, procurement, and transition planning. It also includes an analysis of one-time and operational costs, along with a funding plan involving PNS Funding and estimated revenue application.

Request IR - 12 - Reference: Exhibit B-2 (page 22 of 36, lines 3-6)… "Directors Errors and Omissions Insurance: - These costs are estimated for a $7 million per-claim E&O policy, based on benchmarking with - other independent public agenci...

AI summary The document requests benchmarking data for Directors Errors and Omissions Insurance, citing a forecast of $0.03 million based on comparisons with other independent public agencies in Nova Scotia. The insurance is estimated for a $7 million per-claim policy, with premium quotes expected in August 2025.

Response IR - 12 - a) Benchmarking data from specific independent public agencies was not shared at the time - of budgeting. To clarify referenced evidence, the estimate of $0.03M was informed by - general market knowledge of premiums for...

AI summary The response indicates that benchmarking data from independent public agencies was not available during budgeting. The estimate of $0.03M is based on general market knowledge and informal discussions with insurance providers. Final premium quotes will be obtained through a market process, and any variance will be reconciled through the Net OM&A Deferral and Variance Account.

Response IR - 13 - a) At the time of budgeting, formal written quotes were not obtained. The $0.005 million estimate was information by high-level indicative market information and informal discussions with insurance providers regarding of...

AI summary The NSIESO estimated a budget of $0.005 million for insurance based on informal discussions and indicative market information, acknowledging a low physical risk profile. Formal quotes will be obtained before binding coverage, with any variance accounted for in the Net OM&A Deferral and Variance Account.

Response IR - 14 - a) To clarify referenced evidence, the estimate of $0.005 million was informed by general - market knowledge of typical property insurance premiums for leased office space in - Nova Scotia and informal discussions with i...

AI summary The NSIESO estimates a property insurance premium of $0.005 million based on market knowledge and informal discussions with insurers. The organization plans to obtain market quotes to confirm actual costs and will reconcile any variances through the Net OM&A Deferral and Variance Account.

- "Communications Plan: These costs are to engage a senior communications consultant to - develop and oversee the implementation of a public and stakeholder engagement plan, - messaging framework, media strategy, aligned with the branding,...

AI summary The document outlines the estimated cost for developing a communications plan, including hiring a senior communications consultant for 300 billable hours at $150/hour, based on the NSIESO's assessment of average rates in Nova Scotia for experienced communication professionals. The request asks for the data and methodology used to determine the 300-hour estimate.

NON-CONFIDENTIAL - Request IR 19 - Reference: Exhibit B-2 (page 23 of 36, lines 20-22)... "The costs are for travel, lodging, and meal - costs for quarterly in-person meetings for the Board of Directors. This estimates $2,500 $3,000 - per...

AI summary The document discusses the cost estimation for quarterly in-person meetings of the Board of Directors, including travel, lodging, meals, and other incidental expenses for out-of-province board members. The estimate ranges from $2,500 to $3,500 per meeting, with an example of $5,600 in expenses for a specific meeting.

Response IR - 26 a) The $0.50 million estimate for the Technology Needs Assessment and Business Case reflects anticipated external consulting services to support the NSIESO in establishing its technology environment through one or more sco...

AI summary The NSIESO estimates a $0.50 million cost for a Technology Needs Assessment and Business Case, involving external consulting services to support its technology environment. The scope includes inventorying Nova Scotia Power's systems, identifying technology needs, and developing a business case with cost and risk considerations. This is a planning estimate, and formal quotes will be sought before proceeding.

NON-CONFIDENTIAL 1 Request IR - 32 2 Reference: Exhibit B-2 (page 29 of 36, line 5, Table 15) 3 a) Please provide the supporting calculations showing the breakdown of how the following 4 One-Time Transition Costs were forecasted: 5 a. HR T...

AI summary The document outlines a request for detailed calculations and assumptions regarding one-time transition costs, including HR planning, program management, and technology expenses. The response references a financial forecast document and indicates that estimates were solicited from the market for various services.

- The NSIESO notes that any one-time transition costs during the test period exceeding the - Provincial funding will be recorded as a shortfall in the Net OM&A Deferral and Variance - Account, to be recovered in a future application, subje...

AI summary The NSIESO outlines that one-time transition costs exceeding provincial funding will be recorded as a shortfall in the Net OM&A Deferral and Variance Account and recovered in a future application, subject to a prudence review. Questions are raised about the scope of the review, whether it will consider all actual costs, changes in estimated costs, and the expectation of future one-time costs.

NON-CONFIDENTIAL 1 Request IR - 2 2 Refer to the Application and Exhibit B-2 - Ongoing OM&A Cost Category Detail, subsection B, 3 NSPI Employee Transfers (including IRP consulting costs) ($1.61M), on pages 19-21 of 36, 4 starting at line 4...

AI summary The document contains a request and response related to the allocation of compensation costs and consulting fees associated with NSPI employee transfers and IRP functions. The response details salary, benefits, and other compensation components, as well as references to prior responses for additional information.

Request IR – 3 - Refer to the Application and Exhibit B-2 Ongoing OM&A Cost Category Detail, subsection C, - Corporate Administration ($0.23M), on pages 21-23 of 36, and respond to the following: - a) For the cybersecurity insurance cost o...

AI summary The document requests detailed information on cybersecurity insurance costs and stakeholder engagement expenses from the Application and Exhibit B-2, specifically under the Corporate Administration section. It asks for policy details on the cybersecurity insurance and confirmation on whether stakeholder engagement costs are one-time expenses.

Response IR – 3 - a) To clarify referenced evidence, the $0.05 million estimate was informed by high-level market information and informal discussions with insurance providers regarding coverage for small to mid-sized organizations handlin...

AI summary The response outlines the basis for the cybersecurity insurance estimate of $0.05 million, which is based on preliminary inputs and informal discussions. It also notes that stakeholder engagement costs of $0.05 million are ongoing and not one-time expenses.

1 Request IR - 8 - 2 Refer to Exhibit N-1, the Application and Exhibit B-2 Ongoing OM&A Cost Category Detail, - 3 subsection H, Finance ($0.16M), on pages 27-31 of 36 and respond to the following: - 4 a) Describe why financing costs are ne...

AI summary The response to Request IR-8 explains that financing costs are necessary to bridge the gap between provincial funding of $2.68M and future funding sources. This is outlined in attached documents related to Response to DGT-IR1 and Response to DGT-IR30.

- 4 Figure 1 Summary of findings, observations and conclusions # Section title Findings, observations, and conclusions 4. Test year budget Overall, based upon our review of the NSIESO's test year budget and all available information, we of...

AI summary The review of the NSIESO's test year budget found no unreasonable cost categories or expense amounts. The overall evaluation of the proposed expenses was deemed reasonable based on the available information.

- Figure 6 Manitoba MISO expenses ($000s)[3](#page-14-0) 4 General & administrative expenses (000s) 2024 2023 Salaries and benefits 243,372 219,694 Depreciation and amortization 34,950 30,369 Outside services 81,463 67,225 Occupancy/teleco...

AI summary The text provides a table showing the general and administrative expenses for Manitoba MISO in 2023 and 2024, including categories like salaries, depreciation, outside services, and FERC assessments. A second table is mentioned that summarizes these expenses on a percentage basis.

- 11 focused on the general and administrative cost categories which have been broken down below:

AI summary The text discusses the breakdown of general and administrative cost categories, indicating a focus on categorizing and analyzing these costs.

3 Figure 12 – Summary of forecast OM&A costs OM&A summary ($millions) Total OM&A Costs One-Time Transitional Costs Ongoing O&M Costs Administration salaries and wages 1.57 - 1.57 NSPI Employee transfers and IRP consulting 1.61 - 1.61 Corpo...

AI summary Figure 12 outlines the forecasted OM&A costs, including both one-time transitional costs and ongoing operational expenses. The table breaks down various cost categories such as administration, legal and regulatory expenses, and transition planning. Provincial funding is applied to reduce the total OM&A costs.

12 Figure 16 – Breakdown of salaries and wages Salaries and wages ($millions) Cost Salaries and wages - Note 1 1.65 Third-party recoveries - Note 2 (0.54) Total salaries and wages 1.11 - 14 Note 1: The $1,650,000 in salaries and wages were...

AI summary The text provides a breakdown of salaries and wages, showing a total of $1.11 million after accounting for third-party recoveries. The note explains that the $1.65 million in salaries and wages was calculated based on an estimated monthly figure of $275,000.

- Directors errors and omissions insurance Per the Application, these costs were estimated for a $7 million per-claim E&O policy, based on benchmarking with other independent public agencies of a similar size in Nova Scotia with premium qu...

AI summary The document discusses insurance cost estimates for the NSIESO, including errors and omissions, general liability, and property insurance. Initial estimates were based on benchmarking and informal discussions, but formal quotes have not yet been finalized. The NSIESO plans to obtain formal quotes before binding coverage.

3 Finance ($millions) Ongoing OM&A Costs Financing 0.10 External financial audit 0.04 Other financial 0.02 Total finance 0.16 - 4 Detail on the basis for the forecasted cost categories above have been detailed below.

AI summary The text provides a financial breakdown of ongoing OM&A costs, including financing, external financial audit, and other financial expenses, totaling 0.16 million dollars. It also references a detailed explanation of the forecasted cost categories.

22 4.3.2.11 One-time transition costs Per the Application, the NSIESO received Provincial funding in March 2025 in the amount of $2.68M which they will apply to one-time transition costs forecast to be $1.23M. The NSIESO's response to NSEB...

AI summary The NSIESO received provincial funding in March 2025 to cover one-time transition costs of approximately $1.23M, which will be tracked within their ongoing OM&A budget rather than in separate accounts. Additional costs will be clearly tagged for reporting.

29 Figure 23 – One-time transition costs One-time transition costs ($millions) OM&A Costs HR transition planning, change management 0.31 Program and project management, and financial advisory 0.41 Accounting set-up and bookeeping 0.02 Oper...

AI summary The document outlines one-time transition costs associated with various operational and strategic initiatives, including HR transition planning, program management, accounting setup, and technology development, with a total estimated cost of $1.23 million.

5.3.1 The NSIESO's administration salaries and wages Per the Application, the NSIESO is forecasting $1,570,000 in ongoing expenses for administration salaries and wages. This cost category consists of salaries and wages for the NSIESO's se...

AI summary The NSIESO is forecasting $1,570,000 in ongoing expenses for administration salaries and wages, covering senior leadership and non-technical administrative roles. This does not include technical roles currently handled by NSPI, which are covered in a separate cost category.

16 Figure 32 – NSIESO's proposed deferral sub-accounts Sub-account name Description of recorded funds per the Application Net Ongoing OM&A Deferral Account ("Sub-Account No. 1") Records the approved forecast Net Ongoing OM&A costs for the...

AI summary The document outlines NSIESO's proposed deferral sub-accounts, which include Net Ongoing OM&A Deferral Account, Net OM&A Variance Account, and Actual Net OM&A Account. These accounts track forecasted and actual OM&A costs, as well as variances and one-time transition costs.

- (ii) Volatility and variability Expense categories that are highly variable would be considered to have a higher degree of significance. 1 (iii) – Expenses that Impact on end user decision-making 2 frequently impact decisions would have...

AI summary The text discusses the importance of volatility and variability in expense categories and outlines filing requirements for future applications. It emphasizes the significance of expenses that impact decision-making, such as those related to reliability and safety. It also addresses accounting policies for the NSIESO, suggesting that consistency with Nova Scotia Power Inc.'s US GAAP could offer benefits in comparability, alignment, and transparency.

HEARING ORDER The Nova Scotia Independent Energy System Operator (NSIESO) applied to the Nova Scotia Energy Board on August 5, 2025, under s. 29 of the More Access to Energy Act , for approval of its proposed expenditure and revenue requir...

AI summary The NSIESO applied to the Nova Scotia Energy Board for approval of its OM&A expenses and revenue requirement for the initial test year ending March 31, 2026, including the establishment of a Net OM&A Deferral and Variance Account.

[25] The current application requests approval of the Net Ongoing OM&A costs, after accounting for the provincial funding of $2.68 million (i.e., $1.23 million applied to one-time transition costs and $1.44 million applied to initial OM&A...

AI summary The IESO seeks approval for a Net OM&A Deferral and Variance Account, deferring rate recovery until a future application. Doane Grant Thornton found the budget's cost categories reasonable but noted a lack of formal support for assumptions, recommending stronger filing requirements. The IESO acknowledges these concerns and notes ongoing efforts to implement financial controls.

Request IR-2: Refer to the Application and Exhibit B-2 - Ongoing OM&A Cost Category Detail , subsection B, NSPI Employee Transfers (including IRP consulting costs)($1.61M) , on pages 19-21 of 36, starting at line 4, and respond to the foll...

AI summary The document requests clarification on the allocation of salary compensation and consulting fees related to NSPI employee transfers and IRP functions. It asks for a breakdown of costs and confirmation of vendor selection and transfer timelines.

Request IR-3: - Refer to the Application and Exhibit B-2 Ongoing OM&A Cost Category Detail , subsection C, - Corporate Administration ($0.23M), on pages 21-23 of 36, and respond to the following: - a) For the cybersecurity insurance cost o...

AI summary The document requests detailed information on cybersecurity insurance costs and stakeholder engagement expenses from the Application and Exhibit B-2, specifically under the Corporate Administration section. It asks for policy details on the insurance and confirmation on whether stakeholder engagement costs are one-time expenses.

Request IR-7: Refer to the Application and Exhibit B-2 - Ongoing OM&A Cost Category Detail , subsection G, Facilities and Technology ($0.87M), on pages 26-27 of 36 and respond to the following: M12412, Exhibit N-1(i), the Application Exhib...

AI summary The document includes several requests for information related to cybersecurity, financing, transition costs, deferral accounts, and the affiliate status of NSIESO. These requests aim to clarify cost itemizations, regulatory impacts, and financial arrangements during the transition period.

Non-Confidential To: The Nova Scotia Independent Energy System Operator ("NSIESO") iii) An explanation of the rationale for the 14.75% fringe rate applied to base salaries as well as evidence of how it compares to similar organizations in...

AI summary The document includes requests for explanations regarding the 14.75% fringe rate applied to base salaries and evidence of its comparison to similar organizations. It also asks for the CRA table for 2025, a breakdown of compensation and recruitment costs, and a list of employees expected to transfer with details on potential role duplication.

18 1 2025 M12412 3 4 5 6 Preamble: In summarizing NSEB IR-10, DGT paraphrases the NSIESO's Response that the costs were bifurcated into multiple accounts to enhance tracking and transparency. And additionally, the deferral sub-account was...

AI summary This text outlines a regulatory inquiry regarding the bifurcation of costs into multiple accounts for tracking and transparency, as well as the creation of a deferral sub-account to comply with retroactive ratemaking rules and prudence reviews. The DGT is being asked for their views on the efficiency, transparency, and necessity of these actions, as well as the nature of the proposed Net OM&A Deferral and Variance Account.

Unknown Costs IESO-Nova Scotia emphasizes that a portion of the proposed $6.75 million revenue requirement is expected to be offset by an estimated $1.4 million of Provincial Funding remaining from the total $2.68 million provided. This re...

AI summary IESO-Nova Scotia acknowledges that part of its proposed revenue requirement may be offset by remaining provincial funding, but notes that costs are not fully understood and are expected to increase. The entity requests approval for the recovery of the approved revenue requirement starting April 1, 2026, and has also applied for an extension to submit its next revenue requirement application.

Please refer to: David Roberts Email: [[email protected]](mailto:[email protected]) Assistant: Alissa Whalen Assistant's email: [[email protected]](mailto:[email protected]) January 15, 2026 Via Secure File Transfer C...

AI summary The Consumer Advocate submits that the IESO-NS's revenue requirement and deferral account request should be approved with clear guidelines reflecting Doane Grant Thornton's concerns. IESO-NS is a new organization still establishing its internal capabilities.

January 29, 2026 Ms. Crystal Henwood Regulatory Affairs Officer/Clerk Nova Scotia Utility and Review Board 1601 Lower Water Street, 3rd Floor P.O. Box 1692, Unit "M" Halifax, NS B3J 3S3 Re: M12412 - IESO Nova Scotia 2025/2026 Revenue Requi...

AI summary The IESO Nova Scotia submitted a reply to the NSEB regarding its 2025/2026 revenue requirement application. The Consumer Advocate, Small Business Advocate, and Industrial Group did not object to the revenue requirement or the establishment of a deferral account but provided recommendations on cost control, future costs, and evidentiary requirements.

[24] A breakdown of IESO Nova Scotia's proposed Net Ongoing OM&A costs of $5.31 million was set out in Table 1 in the application: OM&A Cost Category Total OM&A Costs ($)(Millions) One-Time Transitional Costs ($) (Millions) Ongoing O&M Cos...

AI summary The text presents a breakdown of IESO Nova Scotia's proposed Net Ongoing OM&A costs of $5.31 million, including various cost categories and their allocation between one-time and ongoing expenses, as outlined in Table 1 of the application.

[25] The current application requests approval of the Net Ongoing OM&A costs, after accounting for the provincial funding of $2.68 million (i.e., $1.23 million applied to one-time transition costs and $1.44 million applied to initial OM&A...

AI summary The IESO seeks approval of a Net OM&A Deferral and Variance Account, deferring rate recovery until a future application. Doane Grant Thornton found the financial model mathematically sound but criticized the lack of formal evidence for budget assumptions, recommending stronger filing requirements. The IESO acknowledges these concerns and notes ongoing efforts to implement financial controls.

With respect to the integrated resource planning function, among the roles it identified were the Vice President of Operations, Planning, Reliability & Procurement and the Director, Market Operations. [57] More specifically related to the...

AI summary The document discusses the integrated resource planning (IRP) process, including staffing and costs associated with transitioning NS Power employees and consulting fees to the IESO. The IESO highlights that these costs are already included in NS Power's rates and do not represent incremental costs for customers.