Topic:"Revenue Requirement" in M12833

NON-CONFIDENTIAL 1 TABLE OF CONTENTS 2 3 1.0 Introduction 3 4 1.1 Filing Requirements 3 5 2.0 Annual DDA Reporting Requirements 5 6 2.1 Continuity Schedule of Amounts Reclassified to the DDA 5 7 8 2.2-2.4 Supporting Schedules for Actual an...

AI summary The document outlines the structure and content of a regulatory filing related to the 2023-2024 General Rate Application by Nova Scotia Power Inc. It includes sections on reporting requirements, asset management, amortization, and securitization, with figures and appendices providing detailed financial and operational data.

14 The second scenario assumes securitization does not occur by the end of the 2026-2027 GRA test period, and as such, the depreciation and financing costs deferred in accordance with the securitization deferral remain on NS Power's balanc...

AI summary This text discusses a scenario where securitization does not occur by the end of the 2026-2027 GRA test period, leading to deferred depreciation and financing costs remaining on NS Power's balance sheet as a regulatory asset. These costs are included in the forecast unrecovered costs for assets within the scope of the DDA, with details provided in Appendix B(2) – No Securitization.

4 In a scenario where future securitization does not occur, amounts included in the Securitization 5 Deferral account will be an unrecovered cost associated with the assets within the scope of the 6 DDA. While NS Power is not proposing the...

AI summary The text discusses the potential future recovery of unrecovered costs, including those in the Decarbonization Deferral Account and Net Book Value, through a General Rate Application or other regulatory proceeding if securitization does not occur.

demonstrate the potential benefits of securitization relative to recovery using the DDA. As illustrated in Figure 5, the use of low-cost securitized debt, DATE FILED: April 30, 2026 Page 9 of 11 rather than the utility's weighted average c...

AI summary The text discusses the potential benefits of securitization compared to the Decarbonization Deferral Account (DDA) for recovering net book value over a 30-year period. It highlights that securitization could reduce income tax expenses and overall financing costs, leading to customer benefits of approximately $184 million. The analysis compares two scenarios: securitization and DDA amortization over 10 and 20-year periods.

Figure 5 – Revenue Requirement for Securitization vs DDA (28-year DDA Amortization) Revenue Requirement ($ Million) Securitization DDA Cost (Benefit) Principal Payments 713 713 - Financing Costs – Debt & Equity 671 699 (28) Income taxes 29...

AI summary Figure 5 compares the revenue requirements for securitization and the Decarbonization Deferral Account (DDA) over a 28-year amortization period. The table shows that securitization has lower principal payments, financing costs, and income taxes compared to DDA, resulting in a lower overall revenue requirement and net present value.

DDA Period 28 Revenue Requirement Without Securitization Year 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 Opening balance 713,000,000 686,400,000 659,800,000 636,235,714 612,671,429 589,107,143...

AI summary The document presents a table detailing the revenue requirement and balance changes for the DDA Period 28, covering years from 2028 to 2045. It outlines the opening and ending balances, amounts collected, and the recovery of net book value over time.

Change vs 28Y Change vs 28Y 10Y Total Decrease in NPV Revenue Requirement 227,715,075 20,912,562 20Y Total Decrease in NPV Revenue Requirement 214,373,529 7,571,016 28Y Total Decrease in NPV Revenue Requirement 206,802,513 2046 2047 2048 2...

AI summary The text presents a comparison of net present value (NPV) revenue requirements over different time horizons (10Y, 20Y, 28Y), showing decreasing values over time, with specific figures for each year from 2046 to 2060 and a total of $713,000,000.

DDA Period 10 Revenue Requirement Without Securitization Year 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 Opening balance 713,000,000 686,400,000 659,800,000 593,820,000 527,840,000 461,860,000...

AI summary The table outlines the DDA Period 10 revenue requirement without securitization, showing opening and ending balances, amounts collected, and recovery of net book value over multiple years. It includes figures from 2028 to 2045, highlighting changes in the DDA balance and revenue requirements over time.

NON-CONFIDENTIAL 1 Request IR-1: 6 D analysis includes or excludes deferred financing costs associated with the securitization 7 deferral account. 8 9 Response IR-4: 10 11 To compare recovery of costs through securitization to recovery thr...

AI summary The document discusses the analysis of deferred financing costs associated with securitization and the assumed timing of the securitization transaction relative to the recovery period. It also mentions the discount rate used in calculating the NPV revenue requirement and its consistent application across amortization scenarios.

23 Request IR-6: - 24 Please confirm the discount rate used in calculating NPV revenue requirement in Figure 5 and - 25 Appendix D; and whether the same discount rate is applied consistently across all amortization - 26 scenarios (10, 20,...

AI summary Request IR-6 seeks clarification on the discount rate applied in NSPI's NPV revenue requirement calculations (Figure 5, Appendix D) and whether this rate is consistently used across 10, 20, and 28-year amortization scenarios.

July 10, 2026 VIA EMAIL Ms. Crystal Henwood Clerk of the Board Nova Scotia Energy Board 1601 Lower Water Street, 3rd Floor Halifax NS B3J 3S3 Dear Ms. Henwood: Re: M12833 - Nova Scotia Power Incorporated's 2025 Annual Report respecting the...

AI summary This document discusses the Decarbonization Deferral Account (DDA) mechanism proposed by Nova Scotia Power Incorporated (NS Power) and its 2025 Annual Report. The Nova Scotia Energy Board approved the DDA in principle but left all aspects open for stakeholder discussion, including the possibility of securitization. The Small Business Advocate (SBA) has reviewed the 2025 DDA Report and submitted comments.

Benefits of Securitization In its submissions for the 2024 DDA Report, the SBA acknowledged that the DDA Report fulfilled the information requirements as set out in the Compliance Filing but also pointed out that one of the primary functio...

AI summary The SBA requested that NS Power provide a baseline for potential savings by comparing the rate impact of securitization to conventional recovery. The 2025 DDA Report includes tables showing expected savings from securitization, driven by differences in financing costs between securitization bonds and NS Power's approved WACC.

M12833 - Nova Scotia Power Inc. - Decarbonization Deferral Account - 2025 Annual Report The Decarbonization Deferral Account was proposed in NS Power's 2023-2024 General Rate Application. In a settlement agreement in that matter, NS Power...

AI summary The Decarbonization Deferral Account was established to manage the retirement of thermal plant assets by 2030. NS Power proposed securitization of related costs, but legislative requirements for securitization remain unpassed. The account's scope and retirement dates are subject to changes from the Integrated Resource Plan.