Topic:"Cost Recovery" in M12914

14 2.2.2 Marine Survey Cost Recovery Approach 15 16 Given the unique nature of the planned full marine survey scope and NSPML's objective 17 to achieve the best outcome for customers, the Company proposes a cost recovery 18 approach broadl...

AI summary NSPML proposes a cost recovery approach for marine surveys similar to NS Power's fuel cost treatment, allowing for adjustments once the Contracted Marine Survey cost is known. This method enables cost-effective procurement but introduces additional process steps. An alternative approach with earlier pricing locks would increase customer costs.

Date Filed: June 25, 2026 Page 9 of 28 1 The Company has discussed this approach with customer representatives and believes 2 it warrants Board consideration. 3 4 NSPML's rationale for this treatment includes: 5 6  Marine survey costs are...

AI summary NSPML discusses the challenges of managing marine survey costs, including their significance to maintenance and inspection expenses, forecasting uncertainties, and the impact on earnings. A proposed solution involves filing the Contracted Marine Survey cost confidentially after the contract award, with adjustments incorporated into the 2027 assessment.

4 Which would be the delta between the Placeholder Marine Survey cost and the Contracted Marine Survey cost after the RFP process is complete. 1 depending on timing.5 The public (including the marine market) would see only the 2 difference...

AI summary The text discusses the difference between the Placeholder Marine Survey cost and the Contracted Marine Survey cost after the RFP process is complete, emphasizing the need to protect commercially sensitive information while ensuring regulatory oversight and accountability.

Date Filed: June 25, 2026 Page 11 of 28 6 Although suppliers are resistant to lock in early, there is potential that NSPML could find a supplier willing to commit further in advance but that commitment is likely to come with a risk premium...

AI summary The text discusses NSPML's commitment to file the Contracted Marine Survey cost and related documentation after the procurement decision, along with an assessment adjustment and WACC implications. The company requests an updated Board Order and a subsequent procurement review, drawing an analogy to fuel cost recovery mechanisms.

13 2.2.3 Summary of Requested Marine Survey Cost Treatment 14 15 Based on the above information, the Company requests the Board accept the following 16 process to include marine survey costs in the 2027/2028 assessment: 17 - 18 The Board a...

AI summary The Company requests the Board to accept a process for including marine survey costs in the 2027/2028 assessment, involving an interim order based on a placeholder cost, followed by a final order after the actual cost is determined, with potential adjustments to customer payments or refunds.

Date Filed: June 25, 2026 Page 18 of 28 1 associated cost recovery rights. Of note is that, at this time, none of the lenders were 2 willing to extend more than the $35 million set out above. Absent unexpected funding 3 requirements, this...

AI summary The document discusses NSPML's financing situation, noting that lenders are only willing to provide up to $35 million in short-term financing due to security concerns. This amount is not long-term financing and will be subordinate to Canada's $1.8 billion in bonds. The document also mentions the amortization of deferred financing charges, with $1.5 million and $1.4 million included in the revenue requirement for 2027 and 2028, respectively.

1 4.0 MARINE SURVEY COST RECOVERY (IN YEAR OR SMOOTHED) 2 3 Discussion of how to recover marine survey costs, which occur approximately once 4 every three years, has been part of recent regulatory reviews and stakeholder 5 engagement. 6 7...

AI summary The document discusses the recovery of marine survey costs, which occur approximately every three years. NSPML argues against multi-year smoothing of these costs, citing financial and administrative complexity, though it acknowledges compliance with such an approach if required by the Board.

15 Key considerations include: 16 17 NSPML's borrowing rates are higher than NS Power's due to the absence of a credit 18 rating and the pledging of all assets under FLG and FLG2. 19 Based on NSPML's understanding of the traditional applic...

AI summary NSPML faces higher borrowing rates due to the absence of a credit rating and asset pledging under FLG and FLG2. Smoothing mechanisms may lead to adverse WACC impacts for customers, and NSPML lacks a balancing mechanism like FAM, complicating debt-to-equity ratio management. NSPML would comply with smoothing if directed by the Board but requests flexibility to adjust DER impacts and revisit the approach if needed.

NOVA SCOTIA ENERGY BOARD NOTICE OF PAPER HEARING NSP MARITIME LINK INCORPORATED (NSPML) applied to the Nova Scotia Energy Board for approval of its 2027 and 2028 revenue requirements and cost assessment pursuant to the Public Utilities Act...

AI summary NSP Maritime Link Incorporated (NSPML) has applied for approval of its 2027 and 2028 revenue requirements and cost assessments, proposing amounts of $200.3 million and $191.5 million respectively. The cost assessment will be recovered from NS Power customers. The Nova Scotia Energy Board will conduct a paper hearing process, with public participation opportunities.

REDACTED 1 Request IR-05: 2 3 In Exhibit N-1, p. 9, NSPML describes the contingency support budget, with potential refund 4 to customers. Please provide the approved budget amount, actual amount, and details on 5 associated refunds, as app...

AI summary The document discusses NSPML's marine contingency support budget and associated customer refunds from 2022 to 2026. It outlines the approved and actual amounts for each year, as well as the refund mechanisms, including the inclusion of WACC and conditions for 2026.

REDACTED 1 Respo nse 1R-06: 2 3 a) The Placeholder Marine Survey cost, as defined in footnote 1 of the Application, 4 5 . Footnote 7 6 provided the approach: 7 8 9 10 11 12 13 This amount, and is not intended to be a representation of anti...

AI summary The response discusses the Placeholder Marine Survey cost, its confidentiality, and its comparison to the Fuel Adjustment Mechanism (FAM). It highlights that both involve estimates that are trued up later, with the FAM being used for fuel costs. The confidentiality of the Placeholder Marine Survey cost is emphasized.

NON-CONFIDENTIAL 1 Response IR-09 a) NSPML acknowledges the response to this information request is likely more detailed than would typically be expected. This is primarily due to the number of questions relating to this item, which NSPML...

AI summary NSPML acknowledges that its response to the information request is more detailed than usual, due to the number of questions and the desire to provide a comprehensive answer. It also states that the impact on customers from borrowing funds for marine survey cost recovery is not expected to be overly material.

NON-CONFIDENTIAL 1 Request IR-10: - Reference: Section 4.0 Marine Survey Cost Recovery

AI summary The document references Section 4.0 Marine Survey Cost Recovery, indicating a request related to the recovery of costs associated with marine surveys.

- NSPML states two key considerations in the decision about how to finance the marine survey - are the following: - Based on NSPML's understanding of the traditional application of WACC, smoothing is likely to create adverse WACC impacts f...

AI summary NSPML discusses the financing of a marine survey, highlighting concerns about the impact of smoothing and deferring recovery on customers' weighted average cost of capital (WACC). A question is raised about the contradiction between these points and the assumption of funding at different rates. NSPML is also asked to provide its forecasted WACC for 2027 and 2028.

NOTICE OF PAPER HEARING _____________________________________________________________________________ NSP MARITIME LINK INCORPORATED (NSPML) applied to the Nova Scotia Energy Board for approval of its 2027 and 2028 revenue requirements and...

AI summary NSP Maritime Link Incorporated (NSPML) has applied for approval of its 2027 and 2028 revenue requirements and cost assessments, proposing amounts of $200.3 million and $191.5 million respectively, to be recovered from customers. The application is under the Public Utilities Act, Maritime Link Act, and Maritime Link Cost Recovery Process Regulations.

NOTICE OF PAPER HEARING _____________________________________________________________________________ NSP MARITIME LINK INCORPORATED (NSPML) applied to the Nova Scotia Energy Board for approval of its 2027 and 2028 revenue requirements and...

AI summary NSP Maritime Link Incorporated (NSPML) has applied for approval of its 2027 and 2028 revenue requirements and cost assessments, proposing amounts of $200.3 million and $191.5 million respectively. The cost assessment will be recovered from customers by Nova Scotia Power Inc. The application is subject to a paper hearing process.

NOVA SCOTIA ENERGY BOARD IN THE MATTER OF: The Public Utilities Act and the Maritime Link Act and the Maritime Link Cost Recovery Process Regulations - and - IN THE MATTER OF: An application by NSP Maritime Link Incorporated for approval o...

AI summary The Nova Scotia Energy Board is considering an application by NSP Maritime Link Incorporated for approval of its 2027 and 2028 revenue requirements and cost assessment under the Public Utilities Act and the Maritime Link Cost Recovery Process Regulations.

NOVA SCOTIA ENERGY BOARD IN THE MATTER OF: The Public Utilities Act and the Maritime Link Act and the Maritime Link Cost Recovery Process Regulations IN THE MATTER OF: An Application by NSP Maritime Link Inc. for approval of its 2027 and 2...

AI summary This document pertains to an application by NSP Maritime Link Inc. for approval of its 2027 and 2028 revenue requirements and cost assessment under the Public Utilities Act, Maritime Link Act, and Maritime Link Cost Recovery Process Regulations.

NOVA SCOTIA ENERGY BOARD IN THE MATTER OF: The Public Utilities Act and the Maritime Link Act and the Maritime Link Cost Recovery Process Regulations – and – IN THE MATTER OF: An Application by NSP Maritime Link Incorporated for approval o...

AI summary This document pertains to a regulatory proceeding involving the Public Utilities Act, the Maritime Link Act, and the Maritime Link Cost Recovery Process Regulations. It concerns an application by NSP Maritime Link Incorporated for approval of its 2027 and 2028 revenue requirements and cost assessment.

23 Request IR-10: - 24 Reference: Section 4.0 Marine Survey Cost Recovery - 25 NSPML states two key considerations in the decision about how to finance the marine survey are 26 the following: - 27 Based on NSPML's understanding of the trad...

AI summary The text discusses NSPML's considerations regarding financing marine survey costs, highlighting potential WACC impacts on customers. It also requests detailed information on vegetation management activities, cost estimates, and the replacement of the SCM system. The discussion raises questions about financial implications and operational impacts.

1 Request IR-6: 2 3 With respect to Exhibit N-1, p. 14-15, 16 and 24, NSPML requests approval for an estimated 4 depreciation associated with the SCM upgrades scheduled for September 2028. 5 6 (a) Please provide the forecast dates for the...

AI summary NSPML requests approval for depreciation costs related to SCM upgrades scheduled for 2028. The request includes questions about project timelines, filing schedules, justification for rate inclusion, and alternative cost recovery methods if depreciation is not approved.

- 8 (a) Please provide an update on the status of negotiations for a contingency 9 support agreement with the HVDC OEM or third parties since the 2026 10 Assessment. - 11 (b) Please identify what specific barriers have prevented NSPML from...

AI summary The document requests an update on negotiations for a contingency support agreement for HVDC cables, identifies barriers preventing agreement execution, and asks for quantification of prior approvals and refunds. It also references a marine survey cost recovery approach and interim approval based on a placeholder cost.

- 26 (a) Please explain the basis on which the Placeholder amount was 27 determined, including all assumptions. 1 2 (b) Please provide the underlying referenced in footnote 7 on p.11. 3 (c) The Application draws an analogy between this pro...

AI summary The text outlines several questions and requests related to the determination of a Placeholder amount, the analogy with NSPI's fuel cost treatment, and the risk allocation for Contracted Marine Survey costs. It also addresses the potential for intervenor input and the impact of delayed cost recovery on ratepayers.

1 (iii) Please provide the calculations showing a realistic order of 2 magnitude (or range) of this incentive. State the 3 assumptions regarding how much the Contracted Marine 4 Survey costs exceed Placeholder, how long the recovery is 5 d...

AI summary The text requests detailed calculations and assumptions regarding the recovery of Contracted Marine Survey costs, including scenarios involving in-year recovery, smoothing over different time periods, and true-up adjustments. It references WACC impacts and the Placeholder Marine Survey cost as a base case.

1 (vii) recovery based on the approach described in the 2 Application with a true-up adjustment once the actual 3 Contracted Marine Survey cost is known, with the amount 4 recovered where actual costs are lower than the 5 Placeholder; and...

AI summary The text outlines a recovery approach based on the actual Contracted Marine Survey cost, with adjustments made once the true-up cost is known. It also mentions a table of scenarios that includes cumulative amounts collected from ratepayers, WACC impacts, and net present value of customer payments over the recovery period.

Request IR-2: Refer to the Application, Section 2.2.3 Summary of Requested Marine Survey Cost Treatment, page 12 of 28, lines 22-30, and page 13 of 28, lines 1-2, which states: • When the Contracted Marine Survey cost is determined, NSPML...

AI summary The text discusses NSPML's proposed approach for handling the Contracted Marine Survey cost, including adjustments to customer payments and an incentive to finalize the cost before year-end 2026. It raises questions about the need for the incentive and whether NSPML expects to finalize the cost by December 31, 2026.

Request IR-5: Refer to the Application, Section 4.0 Marine Survey Cost Recovery (In Year Or Smoothed), page 21 of 28, lines 17-24, and page 22 of 28, lines 4-14: - a) Please provide the evidence that supports NSPML's claim that its current...

AI summary Request IR-5 asks Nova Scotia Power Marine Limited (NSPML) to provide evidence regarding its borrowing rates, costs incurred due to debt-to-equity ratios, and estimated compliance costs with smoothing, compared to customer cost increases based on WACC differences.