Nova Scotia Power’s plan to add a surcharge to power bills for electricity that customers don’t use is being panned.
An expert witness for the province’s two largest pulp and paper mills says the Utility and Review Board should turn down the power company’s request because there’s no incentive for consumers to use less electricity if they’re going to be charged for it anyway.
The proposed surcharge would offset Nova Scotia Power’s lost revenue from reduced consumption and "would blunt the motivation for the customers to participate for the simple reason that it would lower the benefit," U.S. energy expert Alan Rosenberg testified in evidence pre-filed with the board.
The board will begin hearings into Nova Scotia Power’s proposed energy conservation programs on June 3 in Halifax.
The power company wants the regulator to approve the surcharge to residential power bills to cover $7.7 million of a $23-million program to cut electricity consumption next year. Retailers such as Wal-Mart are being asked to pay $7.2 million. The amount of the proposed surcharge hasn’t been determined.
Mr. Rosenberg supports the energy-conservation program but called the proposal for a surcharge "far from ideal regulation" and said the regulator should be playing the role of competition for Nova Scotia Power, which is a regulated monopoly.
"In the competitive arena, companies do not get to recover ‘lost’ revenue from their customers when their sales decrease," said Mr. Rosenberg, hired by NewPage Port Hawkesbury and Bowater Mersey Paper Co. Ltd. to appear as a witness at next week’s hearing.
Mr. Rosenberg, a principal with Brubaker and Associates, Inc. of Chesterfield, Mo., said he is unaware of any other Canadian utility that uses such a surcharge.
A consultant hired by Halifax Regional Municipality has similar concerns. Robert Greneman of Shaw Consultants International Inc. of Cambridge, Mass., states in pre-filed evidence that the proposed surcharge acts to "thwart conservation incentives."
Nova Scotia Power argues that its 440,000 residential customers would benefit the most from the energy-efficiency programs.
The Ecology Action Centre in Halifax has argued that reducing energy use could mean Nova Scotia Power wouldn’t have to build a $1-billion coal-fired power plant.
The province has yet to name an independent administrator to oversee the power conservation initiative. One is expected to be appointed next month.
Nova Scotia Power’s proposal expands on programs offered last year and includes promoting energy-efficient appliances and lighting, electrical conservation retrofits for new and existing homes, energy audits and upgrades for low-income households, and customized projects for small business and industry.
No comments:
Post a Comment