Topic:"Cost Deferral" in M12619

Not Applicable (NA) NR NR Instrumentation/Control System Discipline Drawings Not Applicable (NA) NR NR Mechanical Discipline Drawings Not Applicable (NA) NR NR Total # Deliverables for 3 15 13 12 12 this Project % Defined/Complete 100% 100...

AI summary The text discusses a Class 3 estimate for a project, noting that 87% of deliverables are complete, with a 10% contingency selected to account for execution risks such as technical field advisor costs, labor, and contract support. The document is part of the 2026 ACE Plan and includes redacted information.

NR Instrument Datasheets Not Applicable (NA) NR NR/S Electrical Discipline Drawings Not Applicable (NA) NR NR Instrumentation/Control System Discipline Drawings Not Applicable (NA) NR NR Total # Deliverables for this Project 5 22 20 20 20...

AI summary The document outlines a Class 3 project estimate with 87% of deliverables completed. A 10% contingency was selected to cover risks such as equipment replacement, rock breaking, and additional tree trimming.

9 NS Power 2025 ACE Plan Items – Deferred or Cancelled 3rd Quarter Overview - as of September 30, 2025 This report includes any deferred or cancelled projects that were included in the 2025 ACE Plan. 2025 ACE 2025 ACE Project CI Project Ti...

AI summary The report outlines deferred or cancelled projects from the 2025 ACE Plan, including the HYD - Tusket Facility Refurbishment and TRE5 Stack Expansion Joint Replacement. The Tusket project is deferred to 2027 due to additional engineering requirements, while the TRE5 project is deferred to 2026 with risk mitigation measures.

2026 Less than $1M This project is being deferred to 2026 outage. The existing approach to management of this asset is expected to address near-term risks. C0061363 TRE5 - Screenwash Pump Replacement 129,989 151,107 Deferred 2026 Less than...

AI summary Several capital projects related to Thermal Recovery Equipment (TRE) have been deferred or cancelled due to updated condition assessments and risk management strategies. These decisions are based on the existing approach to asset management being sufficient to address near-term risks, and some risks being managed through other capital items.

rred 2027 Less than $1M Deferred due to reprioritization. The existing approach to asset management of this asset is expected to address near-term risks. C0039046 LIN Ash Silo Refurbishment 2024 197,599 214,456 Cancelled Less than $1M This...

AI summary The document outlines several deferred and cancelled projects from the 2025 Annual Capital Expenditure (ACE) Plan, including the 2027 project deferred due to reprioritization and two projects cancelled based on updated risk assessments. These decisions reflect a revised approach to asset management.

REDACTED (CONFIDENTIAL INFORMATION REMOVED) 2026 ACE Plan Appendix D Page 8 of 179 New Updates – FIN • FINs often take more time to process than other capital applications, due to required final costing activities. • In particular, undersp...

AI summary The 2026 ACE Plan Appendix D discusses challenges in processing FINs, particularly underspent ones, due to delays in final costing and unused contingency. It recommends adjusting the underspend threshold and extending the timeline for filing to improve regulatory efficiency.

REDACTED (CONFIDENTIAL INFORMATION REMOVED) 2026 ACE Plan Appendix D Page 27 of 179 Nova ScoƟa Power Inc. Capital Planning & Capital Expenditure JusƟficaƟon Criteria Summary Document for the capital project are further defined. All ranking...

AI summary Nova Scotia Power Inc. outlines its capital planning and expenditure justification criteria, emphasizing the review process by an Investment Review Team. Projects are ranked based on criticality and condition, with colors indicating priority and risk levels. Multiple factors may influence rankings, and red indicates high priority.

1 6.0 CONCLUSION 2 3 NS Power has increased the incremental sustaining investment in the MHS to maintain safe and 4 reliable operation of the system, while deferring a major investment for customers until the future 5 of the MHS is determi...

AI summary NS Power defers major redevelopment of Mersey Hydro Station (MHS) until the next Integrated Resource Plan (IRP) to avoid long-term commitments, aligning with Nova Scotia’s Clean Power Plan and prioritizing affordability. Incremental investments maintain safe operations while conducting preliminary studies and stakeholder engagement.

2026 Annual Capital Expenditure (ACE) Plan (NSEB M12619) NSPI Responses to Consumer Advocate Information Requests 2 3 With respect to Appendix I, CIs for transmission replacement and upgrade projects 4 C0080110 and C0080109, and 2024 ACE P...

AI summary The document pertains to the 2026 Annual Capital Expenditure (ACE) Plan (NSEB M12619) and includes NSPI's responses to Consumer Advocate Information Requests. It addresses questions regarding risk registers, cost accountability mechanisms, and project documentation for transmission replacement and upgrade projects.

REDACTED 1 fluctuations (such as steel which has increased significantly due to the impact of tariffs) 2 and potential delays in the delivery of long lead materials. 3 4 (f) This contingency was not based on previous projects, therefore no...

AI summary The text discusses contingency planning for a project, highlighting factors such as material cost fluctuations due to tariffs, long lead times for critical components like switches, and the use of estimates by subject matter experts to guide projected costs. The contingency was determined based on expert judgment rather than historical data.

NON-CONFIDENTIAL 1 Response IR-26: 2 3 (a) Careful management of resources refers to contractor resources and includes activities such 4 as leveraging geographical homebases of contractor resources to reduce per diems and 5 hotel stays and...

AI summary NS Power discusses careful management of contractor resources to reduce costs and improve efficiency in its vegetation management program. The trimming of trees near existing lines is an operating expense, and the 2025 trimming goals were exceeded despite wildfire restrictions. Adjustments were made to focus on areas requiring less equipment and labor.

NON-CONFIDENTIAL 1 (e) Yes, vegetation management is covered by the Project Delivery Model. Cost minimization 2 actions in the past have included working with the Provincial Department of Public Works 3 to combine efforts in areas where ro...

AI summary The text discusses cost minimization strategies in vegetation management, including collaboration with provincial and private entities, reducing right-of-way widening, and sharing resources. It also mentions the intent to increase vegetation management work using allocated funding for reliability improvements.

NON-CONFIDENTIAL 2 (c) Yes, NS Power did consider mitigating approaches but found that any potential approaches 3 led to a scope change definition becoming very complex and difficult to apply consistently 4 across all projects. The main ap...

AI summary NS Power considered various approaches to mitigate scope change complexities but found them too complex. They favor simplified definitions and believe current thresholds will capture most significant changes. They are open to additional language for scope changes based on stakeholder input.

NON-CONFIDENTIAL 1 (i) Given the amount of subsequent spending on this project, what is the revised 2 Final Date for this project? 3 4 (ii) Please discuss the delay in this project that was started 2024/08. 5 6 Response IR-16: 7 8 Yes. Pro...

AI summary The response discusses the revised final date for a project and the reasons for delays, including budget variances and project progress updates. Specific projects like the Tusket Falls Main Dam and HYD WRC Tailrace Rock Bolting Phase 2 are mentioned with their current status and estimated costs.

- (ii) Have decreased investment planned for 2026. 1 (b) Please explain which of the CEJC rating criteria listed on Page 89 of 782, Lines 4-12 23 requirement to file a Final Cost application when a project is completed as planned, but the...

AI summary The text discusses the requirement to file a Final Cost application when a project is completed as planned but exceeds the underspend threshold due to unused contingency. Examples are provided for projects under and over $5,000,000, and NS Power states that the proposed CEJC amendment wording is clear and does not require revision.

M12619 NOVA SCOTIA ENERGY BOARD IN THE MATTER OF: The Public Utilities Act, R.S.N.S. 1989, c. 380 -and - IN THE MATTER OF: an application by NOVA SCOTIA POWER INCORPORATED (NS POWER) for approval of approximately $284.0 million of its ANNU...

AI summary The Consumer Advocate filed evidence in the proceeding regarding NS Power's 2026 ACE Plan, highlighting cost minimization opportunities and issues with risk matrices and reliability projects. John Wilson of Grid Strategies provided recommendations on reporting requirements, contingency caps, and spare equipment inventory.

between 2025 and 2026 or that the 2025 ACE Plan estimate was not developed to a detailed level of maturity. Nevertheless, the Board believes that this is not atypical of a capital project's evolution. [22] The Board believes the more relev...

AI summary The Board acknowledges that the 2025 ACE Plan estimate may not be fully detailed but emphasizes the importance of monitoring cost escalations after detailed estimates are approved. The Board uses the Authorization to Overspend (ATO) process to monitor costs.

2.3.1.1 Findings [44] The Board accepts that an increase in expenditure does not, in itself, mean that an activity ceases to qualify as routine. Required expenditures may reasonably vary with asset conditions, customer growth, system requi...

AI summary The Board acknowledges that increased expenditure does not automatically disqualify an activity as routine but is concerned that temporary cost increases may become embedded in historical data, influencing future forecasts. NS Power is urged to clearly distinguish between structural and temporary cost drivers in future ACE Plans.

2.3.2 Enhanced Tracking and Cost Minimization [49] The CA raised concerns regarding NS Power's ability to demonstrate cost minimization within the Distribution Routines. In his evidence, Mr. Wilson observed that regular and overtime person...

AI summary The CA raised concerns about NS Power's ability to track and demonstrate cost minimization in Distribution Routines. NS Power clarified that while their accounting software tracks labour hours and costs, this information is not always used for forecasting, except in the case of Distribution Routine D005.

e reviewing NS Power's accounting practices about capital in 2023-2024 in Matter M11067. The Board is of the view that the requested audit, and the cost it would entail, are not required at this time. [173] Another point of contention rais...

AI summary The NSEB is reviewing NS Power's capital spending practices for 2023-2024 in Matter M11067. The Board does not currently see a need for an audit. The DOE raised concerns about cost escalations in ACE Plan items, and the Board agrees that variances between initial estimates and approval filings should be scrutinized, though ACE Plan estimates are less detailed than those in approval applications.

8.3 Considerations for Subsequent Submittal Items [212] There was discussion about IT or cybersecurity-related projects listed as subsequent submittal items in the 2026 ACE Plan. Two projects, in particular, raised several concerns. The Id...

AI summary The document discusses concerns raised about the increasing costs of IT and cybersecurity-related projects, specifically the Identity and Access Management and Customer Information System (CIS) Replacement projects. The Industrial Group recommends that future submittals include detailed cost explanations related to the 2025 cyber incident. NS Power argues that current processes already provide necessary information, but the Board agrees that specific references to the impact of the cyber incident on cost variances should be included in future submissions.

ant cost categories. For Routines using internal labour the information should also include a breakdown of labour costs (regular and overtime labour, budgeted costs and hours, actual costs and hours). - 3. NS Power must provide sufficient...

AI summary The document outlines requirements for NS Power to provide detailed cost breakdowns and explanations for changes in routine expenditures, including labor, materials, and contractor costs. It also mandates monitoring of planned versus reactive replacement activities and the inclusion of Routine Expenditure provisions in the 2028 ACE Plan.

rom the regulatory authorities? 1. If not, does NS Power have an expected date by which all required permits will be approved? 2. If so, what is the expected start date for project construction? Page 154 states: “The contingency also cover...

AI summary The text raises questions about NS Power's permitting process, the inclusion of contingency costs, and the status of investigative work for a project. It also discusses the need for geotechnical investigations to reduce uncertainty in design assumptions and potential cost savings.

- 6 (b) Please elaborate on how the cybersecurity breach in 2025 impacted the 7 decision to defer or cancel any of the listed capital projects in 2025, as 8 referenced in Appendix C, including specifically the nine IT projects 9 deferred t...

AI summary The text includes questions about the impact of a 2025 cybersecurity breach on capital project decisions, the meaning of 'Resources were required for priority restoration,' and the cybersecurity implications of deferring IT projects. It also asks about updated risk assessments and mitigation plans.

March 11, 2026 Crystal Henwood Clerk of the Board Nova Scotia Energy Board 1601 Lower Water Street, 3rd Floor Halifax, NS B3J 3S3 Re: Fourth Quarter 2025 Capital Reports Dear Ms. Henwood: Capital Reports In this package are the 4th Quarter...

AI summary The document contains the Fourth Quarter 2025 capital reports submitted to the Nova Scotia Energy Board, detailing capital expenditures, active projects, deferred and cancelled projects, FIN reports, and unapproved spending. These reports are submitted in accordance with the 2016 ACE Plan and prior Board orders.

Request to the Board - The review of projects contained in Appendix A representing projects with escalation levels of - 50% or greater indicates significant increases across Generation, Transmission, Distribution, - Hydro, and General Plan...

AI summary The document requests the Board to conduct enhanced scrutiny of projects with significant cost escalations across various categories. It argues that these increases are not solely due to external factors but reflect broader issues like scope expansion and misclassification of expenses. The Department recommends procedural reviews to ensure proper governance and ratepayer protection.

The Proposed Definition Renders the Provision Meaningless NSPI itself testified that changes in "intent" that would trigger a scope change application would be "quite rare"[23](#page-7-0) and that NSPI "very, very rarely"[24](#page-7-2) de...

AI summary The proposed definition of scope change in the Capital Expenditure Justification Criteria (CEJC) is criticized for being too broad, potentially eliminating meaningful oversight. NSPI testified that scope changes are rare and that it rarely deviates from project intent once filed, suggesting the new definition may render the provision ineffective.

No Robust Routine Program-Level Review There is no distinct "routine review process" separate from NSPI's general capital scrutiny.[47](#page-13-0) NSPI relies on the same review process of any capital expenditure, and relies on the ACE pr...

AI summary The text discusses the lack of a distinct routine program-level review process for capital expenditures by NSPI, highlighting concerns about cost minimization, lack of monitoring for cost creep, and insufficient oversight of routine capital programs. It suggests that the Board should require NSPI to file detailed program-by-program reviews and establish a CEJC materiality trigger for routine capital growth.

cts investments driven by customer growth and load requirements, as well as those necessary to implement the Company's Five-Year Reliability Plan and maintain reliability performance at or above current levels. Summary CEJC, page 14. DATE...

AI summary The text discusses the importance of maintaining capital expenditures to ensure system reliability and compliance with prudence standards. It also mentions a request by the IG for enhanced cost-variance disclosure in cybersecurity-related projects following the 2025 incident.

between 2025 and 2026 or that the 2025 ACE Plan estimate was not developed to a detailed level of maturity. Nevertheless, the Board believes that this is not atypical of a capital project's evolution. [22] The Board believes the more relev...

AI summary The Board acknowledges that cost estimates for capital projects may evolve and are not always detailed at the outset. However, it emphasizes the importance of monitoring cost escalation after detailed estimates are approved, using mechanisms like the Authorization to Overspend (ATO) process.

ant cost categories. For Routines using internal labour the information should also include a breakdown of labour costs (regular and overtime labour, budgeted costs and hours, actual costs and hours). - 3. NS Power must provide sufficient...

AI summary The document outlines requirements for NS Power to provide detailed cost breakdowns and explanations for changes in routine expenditures, including labor, materials, and contractor costs, and to assess the use of existing systems for monitoring productivity and cost trends. It also mandates the inclusion of Routine Expenditure provisions in the stakeholder review for the 2028 ACE Plan.

OPENING STATEMENT 27 NS DEPT. OF ENERGY 1 the burden of those overruns falls onto ratepayers. 2 For example, some of the hydro plants 3 produce minimal energy and yet work on them has often 4 proceeded in the face of significant cost overr...

AI summary The Department of Energy highlights concerns over cost overruns in hydro plant projects and calls for regulatory scrutiny of the 2026 ACE Plan, emphasizing the need for accountability and alignment with the IESO mandate. It also requests the Board to disallow ratepayer funding for certain projects, arguing that financial consequences should be borne by shareholders, not ratepayers.

NS POWER PANEL 355 Cr-ex, (Mahody) 1 produce? 18 2025 transmission line replacement work, has any of that 19 work been deferred into 2026. INTERNATIONAL REPORTING INC. CERTIFIED COURT REPORTERS 1 (Beaton) I don't have specifics, A. 2 but b...

AI summary The proceeding discusses the potential deferral of 2025 transmission line replacement work into 2026. A witness notes that a reduction in spending may be due to deferrals, which are now included in the explanation provided.

INTERNATIONAL REPORTING INC. CERTIFIED COURT REPORTERS in some cases, I left some points, you know, sort of to the Board's discretion and others that I made more concretely. BY MR. KAYTER: Q. Thank you, Mr. Wilson. Two questions anticipate...

AI summary The discussion centers on acceptable levels of project cost escalations, referencing the Board's non-binding contingency guidelines and a recommendation for a 10 percent contingency cap on transmission projects without risk matrices. Nova Scotia Power is noted as following these guidelines generally.