Electricity Committee Report Recommends Gradual Competition, More Renewable Energy

ENERGY--Electricity Committee Report Recommends Gradual Competition, More Renewable Energy

A committee studying electricity issues is recommending that Nova Scotia generate more power using renewable energy resources and gradually introduce competition in the province's electricity marketplace.

The Electricity Marketplace Governance Committee's final report focuses on moving toward those objectives in a way that does not jeopardize Nova Scotian's access to secure reliable electricity.

The report, released by Energy Minister Cecil Clarke today, Oct. 23, addresses a number of complex issues with respect to electricity markets, transmission, renewable energy and co- generation.

Committee chair Robert Fournier said the committee has fulfilled its mandate to prepare recommendations for the government in order to encourage greater competition in the electricity marketplace, while preserving the strengths of the present system. The final report covers more than a dozen substantive issues and makes 89 recommendations.

"This report represents a tremendous effort, and a significant time commitment on the part of the committee's participants over the past 14 months," said Dr. Fournier. "I am confident that the committee has designed and recommended a market framework that will achieve the objectives set out in the province's Energy Strategy, as well as providing an appropriate foundation for future flexibility and evolutionary change."

"We appreciate the significant effort members of the committee have made, many of them contributing hundreds of hours to exploring these complex issues," said Mr. Clarke. "This is an important first step in a process that will ultimately assist the province in building a sustainable, long-term approach to electricity competition and generation for Nova Scotians."

The committee was created in May 2002 to make recommendations to the Minister of Energy on strategic implementation, development, structure, and rules for the electricity sector. The committee has seven members and two observers.

The province also retained the services of Navigant Consulting Ltd. to provide independent technical assistance and advice on a variety of issues.

For more information on the committee process see the Web site at www.gov.ns.ca/petro/EnergyStrategy/emgc .

NOTE: A list of highlights from the Electricity Marketplace Governance Committee's final report follows:

• Nova Scotia's electricity marketplace should be opened initially to permit competition at the wholesale level (six municipal utilities) which represents 1.6 per cent of the total market.

• Government should undertake in the near term, a detailed quantitative analysis of the costs and benefits associated with a broader market opening, as a basis for future decisions on potentially broadening the market scope.

• Nova Scotia Power Inc. (NSPI) should develop and file a transmission tariff with open and non-discrimination access for all market participants.

• The province should adopt a mandatory Renewable Portfolio Standard (RPS) to take effect in 2006 mandating an increase in the share of new (post 2001) renewables in electricity supply to 5 per cent by 2010.

• Independent power producers (IPPs) producing electricity from renewable energy sources using facilities constructed in Nova Scotia after 2001 should be permitted to sell directly to any electricity customer (wholesale or retail), but they should be licensed by the Utility and Review Board (UARB) to prevent abusive sales tactics.

• Renewable IPPs with installed capacity of 100 kW or less should be eligible for net metering.

• A variety of recommendations designed to provide enhanced market access opportunities to encourage the development of new cogeneration facilities.

• UARB to oversee a competitive process to acquire either new capacity or demand-side management initiatives based on NSPI's annual public filing of 10 year supply and demand plans.