March 23, 2012
Nova Scotia

URB may hold full hearing on power deal

By JOANN ALBERSTAT Business Reporter, thechronicleherald.ca 22 March 2012

The Nova Scotia Utility and Review Board may change the way it handles a proposed provincial plan to get more renewable electricity from independent producers because of concerns raised by Nova Scotia Power.

The provincial regulator said Thursday it could hold a full hearing on a draft power purchase agreement, rather than make a decision based on written evidence.

“It is apparent to the board, given the comments that were received yesterday, including those of Nova Scotia Power, that an abbreviated paper process the board had put in place to review this matter may not be adequate,” Nancy McNeil, regulatory affairs officer, wrote in a letter to the electrical utility Thursday.

In a filing Wednesday, Nova Scotia Power said it would not adopt the proposed agreement unless the regulator orders it to do so. The company said it’s concerned the draft terms favour independent producers at the expense of ratepayers.

“In light of our concerns …, N.S. Power is not prepared to execute the proposed standard form (power purchase agreement), unless directed to do so by the UARB,” says a letter signed by company lawyer Nicole Godbout.

If it’s directed to accept the proposed terms, Nova Scotia Power said it will ask the review board to confirm that procuring more renewable electricity is “prudent” and that the utility won’t be held responsible for any additional costs or problems the approved projects may encounter.

The regulator responded by saying it will decide the next steps after the province’s renewable electricity administrator makes its own filing, which is due April 4.

The administrator, Power Advisory LLC, submitted the proposed agreement to the review board last month and had expected a ruling by April 25. That would pave the way for developers to submit their bids by May.

Several wind projects are in the planning stages across the province but some developers have said they expect no more than three or four of them to be selected.

The provincially appointed administrator, a Massachusetts-based consultant, is expected to announce the winning bidders in mid-July.

The province wants to obtain an additional 300 gigawatt hours of renewable electricity from independent producers, starting Jan. 1, 2015. That is equal to about 100 megawatts of wind energy.

The last time the province issued a tender call for renewable electricity, which occurred in 2007, the power purchase agreement was developed by Nova Scotia Power.

The utility said the proposed terms this time around are “substantially changed” from those approved by the review board five years ago.

Nova Scotia Power outlined several parts of the agreement it said could result in extra costs to ratepayers and require them too shoulder additional risk if a project runs into difficulty.

Some wind farm developers also wrote the review board this week suggesting further changes to the draft agreement.

Montreal-based Renewable Energy Systems Canada Inc., which is planning a wind farm in the Wentworth area, told the regulator it participated in recent consultations by the administrator and is “generally satisfied” with the outcome.

“The proposed contract properly allocates the risks of the contemplated projects to the parties that can best manage them, providing for the best outcome to the customer,” writes Nicolas Muszynski, RES Canada’s senior development manager.

URL to article:  https://www.wind-watch.org/news/2012/03/23/urb-may-hold-full-hearing-on-power-deal/