On January 16, 2023, Eastward Energy filed our 2024 – 2026 General Rate Application with the Nova Scotia Utility and Review Board. Eastward Energy’s focus for this Rate Application is the continued safe and reliable delivery of natural gas while maintaining competitive natural gas rates for our customers.
This is the first Application to adjust our distribution rates since 2011 and a lot has changed in that time:
- We expanded our distribution system and significantly increased our customer base.
- Nova Scotia has begun taking steps to achieve net-zero emissions by 2050 and we’re supporting the achievement of this goal by developing sustainable, resilient low-carbon energy solutions.
- The natural gas market in Nova Scotia has shifted from an export to an import market, and we responded by securing long-term transportation contracts valued at over $250 million to ensure security of supply and cost savings for our customers; and
- The impacts of the pandemic and global geo-political events have driven higher inflation and rising energy prices.
What’s new in this Application?
The key changes proposed in the Application that would directly impact our customers are:
- Rate Classes: Eastward Energy is proposing a new rate structure that replaces Rate Class 1, Rate Class 1A, and Rate Class 2 with a General Service Class. A new rate class will be created for residential customers.
- Rate Adjustments: The proposed new rates would result in an overall increase across all rate classes of 4.3% in 2024, 5.9% in 2025, and 2.2% in 2026. Eastward Energy is also proposing a new tiered pricing structure based on the total consumption of natural gas used by a customer each month – as a General Service or Residential customer uses more natural gas in any month, their incremental cost per gigajoule of natural gas will decline. This new structure would better match revenue with the cost to serve individual customers.
- Shareholder Returns: To help maintain affordable rates for our customers, Eastward Energy is not requesting an increase in our cost of capital and we’re proposing to lower our return on equity.
How will the proposed changes impact customers?
The rate adjustments Eastward Energy is proposing are on the “delivery” portion of a customer’s invoice only. On a customer invoice, the delivery fees include the Base Energy Charge (a variable fee charged for the delivery of natural gas) and the Fixed Monthly Customer Charge (a fixed fee).
The cost of natural gas (Gas Cost Recovery Rate) is not regulated and is not covered in this Application. The cost of natural gas customers consume is billed directly to customers – Eastward Energy does not earn any return on this.
Based on the new rates proposed in this Application:
- Residential Customer rates would increase by 36.2% (an average of $25/month) in 2024.), 15.3% in 2025 and 9.9% in 2026. These increases will help ensure residential customers’ rates are better aligned with the costs to serve them.
- Commercial Customer rates for the new General Service Class would increase by an average of 0.5% in 2024, 5.0% in 2025 and 0.6% in 2026.
- Industrial Customer (Rate Class 3) rates would increase by an average of 0.4% in 2024 and no increases in 2025 and 2026.
When will this happen?
Adjustments to distribution rates and rate classes for all customers are reviewed and approved by the Nova Scotia Utility and Review Board through an open and transparent process. Any new rate increases approved by the NSUARB would be effective January 1, 2024.
For more information, please review a copy of the 2024 – 2026 General Rate Application Executive Summary. The full Application can be found on the Nova Scotia Utility and Review Board website.
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