Emera lowered rates to avoid public hearing, says CFO
Corporate candour sheds light on Nova Scotia Power deal
An executive at Nova Scotia Power's parent company admitted this week the company was willing to sacrifice a slightly lower guaranteed profit to avoid a public rate hearing before an election year.
In September Nova Scotia Power reached a settlement with consumer advocates and industry stakeholders.
On Thursday, Scott Balfour, CFO of Emera, told analysts in Toronto why that deal was worth sacrificing some of its rate of return.
"That quarter point was traded off somewhat by the fact that we now have a two-year rate settlement in place rather than a one-year. That has been our history. That helps take us through an election cycle and other things that can sometimes be distracting," he said.
Neither Emera nor Nova Scotia Power have ever discussed the deal in those terms. Balfour's remarks were first reported by the business website allnovascotia.com.
Balfour described the six per cent rate hike in the deal as a "reasonably healthy increase."
For the Nova Scotia Conservative Leader Jamie Baillie, it's further proof settlement agreements don't work.
"The backroom deal was all about getting Nova Scotia Power through an election which they described as a distraction means we have to go back to the drawing board on how power rates are set in Nova Scotia," he said.
On Friday, Emera said Balfour was merely explaining the Nova Scotia situation to a Toronto business crowd.