Halifax Chronicle Herald
Nova Scotia Power is on the prowl for new sources of natural gas to replace the dwindling supplies from the offshore.
The utility has been in discussions with potential producers of coal-bed methane in Nova Scotia and shale gas developers in New Brunswick, according to documents filed with the provincial Utility and Review Board.
Nova Scotia Power says it "continues to focus on potential future sources of natural gas, both onshore and offshore," but for confidentiality reasons, the utility will not discuss its suppliers, spokeswoman Patty Faith said Wednesday.
In evidence filed with the board leading up to an Oct. 18 hearing on power rates, the utility says it has approached shale gas developers in New Brunswick, including Corridor Resources, Windsor Energy, Apache Canada, Southwestern Energy and PetroWorth Resources.
The use of natural gas to generate electricity will become an increasingly important component of Nova Scotia Power’s effort to comply with government regulations requiring a reduction in the amount of greenhouse gases that power-generating stations can belch into the atmosphere.
Nova Scotia Power is responsible for about half of the province’s greenhouse gas emissions of 10 million tonnes a year. The government wants the utility to cut its emissions by 25 per cent by 2020.
"It’s going to be one of the cornerstones of ensuring renewables take place because natural gas is going to be producing less greenhouse gases than oil or coal," Dalhousie University professor Larry Hughes said Wednesday.
"So that’s why they will want to be finding sources of natural gas, and it can also be used as rapid backup if they’re using gas turbines."
Nova Scotia Power uses natural gas at its retrofitted Tufts Cove power station in Dartmouth, and today that plant represents about 13 per cent of the utility’s generating capacity.
In 1997, Nova Scotia Power signed a 10-year contract with Shell Canada, one of the Sable natural gas producers, to buy 60 million cubic feet of gas per day at a fixed rate for that period.
ExxonMobil, the lead partner in the Sable project, announced recently it is not developing nearby gas fields, and the project’s supply has been declining.
"It’s also going to be a price issue," Hughes said. "Natural gas is cheap right now, the question we have to ask is where is it going to come from?"
Nova Scotia Power applied to the review board earlier this month to raise residential rates by 6.5 per cent starting next year. The increase would cost the province’s 440,000 households an extra $13.35 per two-month billing period, or $6.68 per month, plus tax. The average residential customer has a bill of $244.08 every two months.
The utility is also seeking rate increases of 8.6 per cent for commercial customers and 11.3 per cent for industrial consumers.
The increases, if the review board approves them, would take effect next New Year’s Dayhttp://www.thechronicleherald.ca/Business/1198694.html
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