Task force recommends creation of independent N.S. energy operator

The Clean Electricity Solutions Task Force is recommending the creation of an independent energy operator to oversee new infrastructure.

According to the task force’s final report, the Nova Scotia Independent Energy System Operator (NSIESO) would be based on a not-for-profit model and would oversee “open competition for procurement of all new infrastructure, including generation, transmission, distribution, and storage.”

The report says Nova Scotia Power would be able to bid in any competitive process overseen by the system operator.

Premier Tim Houston announced the task force last April and charged it with finding ways to “modernize Nova Scotia’s electricity infrastructure and regulatory environment.”

The task force examined grid capacity, assessed electricity storage capacity, and engaged with Nova Scotians.

“The transformation of Nova Scotia’s energy system will not be simple,” the report reads. “There are no quick or easy or solutions. It will take time, careful planning, and considerable investment in energy infrastructure to replace coal-fired generation, strengthen our ability to integrate renewable resources, and establish needed transmission upgrades.

“The recommendations proposed are intended to create efficient operation and regulation of the Nova Scotia energy system to ensure costs are avoided while ensuring a comprehensive system approach to solutions.”

The report noted the current Nova Scotia Power System Operator functions as a division of Nova Scotia Power, creating what the report calls “conflicting interests.”

“Discussions between stakeholders and the Task Force…focused on one pivotal concern: the inherent tension of system operator functions residing in a for profit corporation that has not only the legislative duty to provide safe reliable service to customers at just and reasonable rates, but a fiduciary duty to its shareholders to maximize the earning potential of the company,” the report reads.

The task force says its recommendations seek to eliminate this tension.

Other recommendations in the report include:

• amendments to the Public Utilities Act and the Electricity Act
• creating a standalone energy regulator, called the Nova Scotia Energy Board, to oversee electricity, natural gas, pipelines, enforcement and retail gasoline
• establish board term limits of up to seven years
• require Nova Scotia Power to “formally submit an annual asset management plan for approval by the regulator”

In a written statement, Minister of Natural Resources and Renewables Tory Rushton said they are reviewing the report and have accepted the recommendation for a new Energy Modernization Act.

"We are conscious that some of the recommendations could be significant for the energy sector," Rushton said. "Recommendations two to 12 will require more consideration, analysis and conversations with affected parties. We plan to take a measured approach as we consider the best way to proceed."

More to come…

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