Topic:"Fuel Cost Adjustment" in M12954

M12954 – Review of Nova Scotia Power Incorporated Treatment of Variance Accounts On November 9, 2022, the Government of Nova Scotia amended the Public Utilities Act , SNS 2022, c 52, specifically s. 64 AB regarding the application and trea...

AI summary The Nova Scotia Energy Board is initiating a generic proceeding to review Nova Scotia Power Incorporated's treatment of variance accounts under the Public Utilities Act. London Economics International has been retained to review current interest rate practices and analyze alternative approaches. The process includes public comment, report filing, and a formal hearing.

Background Below is a brief summary of current treatment of interest rates for the five deferral/variance accounts, which would be reviewed as part of this proceeding. Demand Side Management Cost Recovery Rider ("DCRR"): In the DCRR Decisi...

AI summary The document outlines the current treatment of interest rates for various deferral and variance accounts, including the DCRR, FAM, SCRR, Securitization Deferral, and DDA. It references past decisions and outlines the Board's stance on applying interest rates, such as NS Power's WACC or the default rate from the Public Utilities Act, pending further proceedings.

Scope of this proceeding The Board envisions the following steps within the proceeding: - Step 1 : Terms of Reference (TOR) : this Draft TOR is being sent to interested parties for comment. This would ensure that key stakeholder concerns a...

AI summary The proceeding outlines steps for reviewing NS Power's variance accounts, including analyzing interest rate treatments for accounts like FAM, DCRR, SCRR, and DDA. LEI will prepare a report based on its analysis and stakeholder input.

STEP 4 – ANALYZE OPTIONAL INTEREST RATE TREATMENT FOR DEFERRAL AND VARIANCE ACCOUNT BALANCES Given that s. 64AB establishes a default interest rate methodology while preserving the Board's discretion to direct otherwise, the Industrial Gro...

AI summary The Industrial Group recommends that Step 4 explicitly consider factors relevant to the Board's discretion in setting interest rates for deferral and variance accounts. It emphasizes the need to analyze the purpose and implications of different account types, such as the Fuel Adjustment Mechanism and Decarbonization Deferral Account, and whether a uniform or account-specific approach is appropriate.

Entity Relevant extracts from intervenor comments LEI's view Industrial Step 4 – Analyze Optional Interest Rate Treatment LEI considers this to be within Group for Deferral and Variance Account Balances the scope of the ToR. ("IG") – Given...

AI summary The Industrial Group suggests that Step 4 of the ToR should consider factors relevant to the Board's discretion in setting interest rates for deferral and variance accounts, including account-specific considerations and impacts on customers and shareholders. The group also highlights differences in the purposes of various accounts, such as the Fuel Adjustment Mechanism and DSM balances, and suggests that a single approach may not be appropriate for all account types.

Background Below is a brief summary of current treatment of financing costs for the five deferral/variance accounts, which would be reviewed as part of this proceeding. Demand Side Management Cost Recovery Rider ("DCRR"): In the DCRR Decis...

AI summary The document outlines the current treatment of financing costs for various deferral and variance accounts, including the DCRR, FAM, SCRR, Securitization Deferral, and DDA. It references past decisions and the application of interest rates, such as the Bank of Canada policy rate plus 1.75% or NS Power's WACC, and highlights pending decisions in a generic proceeding.

Scope of this proceeding The Board envisions the following steps within the proceeding: Step 1 : Terms of Reference (TOR) : the Draft TOR was sent to interested parties for comment. This ensured that key stakeholder concerns were considere...

AI summary The proceeding outlines a structured process for reviewing Nova Scotia Power's variance and deferral accounts, including the analysis of alternative financing treatments and the preparation of an independent report by LEI. This involves multiple steps, including information requests, evidence filing, and potential oral hearings.