New Gas Distribution Rules Introduced

The government of Nova Scotia today tabled a bill setting up new rules for distributing natural gas in the province. The legislation means delivery of natural gas will take place as the number of gas customers increases. The changes are part of the government's plan to implement its recently released energy strategy. The new rules were developed following consultation with potential franchise applicants, industry groups and the public.

"Much of the feedback we have received is in support of our policy to see a natural gas distribution system grow on the basis of what makes commercial and economic sense," said Gordon Balser, Minister responsible for the Petroleum Directorate. "We also took note of concerns about large industrial customers being able to bypass the local distributor."

Bypass will be allowed under two main circumstances: direct connections in the Goldboro-Strait area will be allowed before the natural gas enters the Maritimes and Northeast Pipeline system; and outside a franchise area, direct connections with the Maritime Northeast Pipeline will also be allowed. However, inside a franchise area direct connects will be banned for 10 years to help secure the economic viability of the franchise.

"We believe this policy balance will help encourage franchise applicants and thus begin the buildup of an economically-viable natural gas system," said Mr. Balser. "Trying to build a system by legislated edict has failed. We have consulted widely and believe we have designed a system which can succeed."

The province also announced that the new legislation will only allow a franchise to include the areas that will be serviced within a 10-year period. This means there may be a number of franchises in the province as different groups come forward to make commitments to serve various areas.