HALIFAX -- Nova Scotia Power would face penalties of up to $1 million a year if it doesn't meet performance standards under legislation introduced today by the provincial government.

Energy Minister Michel Samson says the standards would be set by the Utility Review Board based on the best practices elsewhere.

The private utility would also have to report within 90 days of the end of each year explaining how it performed.

The legislation supports other initiatives in the government's 25-year electricity plan announced last month, including the establishment of a three-year rate stability period for the utility's non-fuel costs.

Under the law, Nova Scotia Power would have to pass any tax savings associated with its ownership interest in the South Canoe and Sable wind projects on to ratepayers.

The government says that could mean an estimated $35 million in savings over the first five years.