NS Power provides update on reducing costs

Nova Scotia Power Outsourcing explores vendor contracts under a UARB-approved Rate Stabilization Plan to cut costs via operations and maintenance at Tufts Cove, plant maintenance, line work, meter reading, and capital spending reductions.

Nova Scotia Power is focused on reducing costs for its customers, with the goal of minimizing cost pressure on electricity rates in 2015 and in the future.

Presently, NS Power is in the middle of a two-year Rate Stabilization Plan, which was negotiated with customer representatives and approved by the Nova Scotia Utility and Review Board (UARB) in 2012. The agreement required that $27.5 million be taken out of Nova Scotia Power’s cost structure, reflecting pressures such as discount electricity rates sought by major industrial customers.

“We have an obligation to look at every option to further reduce costs for our customers, whether that’s in our capital program, including green projects now underway in the province, our day-to-day operations, or our fuel purchases,” said Bob Hanf, President and CEO of Nova Scotia Power. “We are reviewing every part of Nova Scotia Power to make sure our customers are getting the best value for their dollar.”

As part of this process, NS Power is investigating outsourcing opportunities. The company is asking outside vendors whether they could supply certain services at a lower cost structure than NS Power is currently able to provide, including operations and maintenance at the Tufts Cove generating station, maintenance at other power plants, some line work, and meter reading, while considering power grid changes that could affect costs. Decisions on whether outsourcing any of these services could reduce costs for customers will be made by early next year.

“We will undertake a full and rigorous process, including discussions with our employees and the union that represents some of our employees, and input from an independent body where appropriate, before any final decision is made,” Hanf said.

Nova Scotia Power has previously contracted out functions including: line work, tree trimming, boiler and turbine work, information technology, printing services, billing services, coal handling, and various aspects of capital construction and infrastructure maintenance.

Approximately 80 positions have been eliminated in Nova Scotia Power this year through retirements, not filling vacancies, and layoffs. There are approximately 1,530 regular, full-time employees at Nova Scotia Power. NS Power has also reduced its spending on construction and other capital projects by $91 million this year, even as the province increases wind and solar projects that will shape future investment.

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