Emera - Emera Recommends Gradual Opening Of Nova Scotia's Electricity Markets and Increased Participation by Nova Scotians in Natural Gas Development

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Emera Recommends Gradual Opening Of Nova Scotia's Electricity Markets and Increased Participation by Nova Scotians in Natural Gas Development

Proposals Highlight Emera's Submission to Nova Scotia Energy Strategy

HALIFAX, Nova Scotia, September 5, 2001, (TSE:EMA): Strengthening Nova Scotian involvement in offshore natural gas development and gradually opening Nova Scotia electricity markets to competition are two key recommendations from Emera's submission to the provincial government task force currently formulating a new energy strategy for Nova Scotia.

Emera's submission contains 26 recommendations and is publicly available on both government and company web sites. In the document, Emera outlines opportunities in natural gas development and advises government to nurture local involvement in the offshore by:

ensuring a diversity of companies are involved in exploration and development of the offshore,
facilitating investment in the offshore by individual Nova Scotians, and
appointing a Minister of Energy to work with other provinces, streamline regulation and acquire the expertise to protect the interests of Nova Scotians.

" Our recommendations are intended to help government maximize the benefits of natural gas development for Nova Scotia", said David Mann, President and Chief Executive Officer of Emera. " Encouraging a diversity of players reduces the risk of boom and bust cycles, supports long-term economic sustainability, and facilitates local involvement in this new industry. And making our regulatory system as efficient as possible encourages investment without sacrificing the public interest. Natural gas is integral to Nova Scotia's position in the evolving northeast energy market. It is in Emera's interest, and the interest of all Nova Scotians, to foster a climate that builds on the opportunity natural gas affords."

With respect to electricity Emera points to the lessons of other jurisdictions where rapid restructuring has led to sky-rocketing power bills and loss of secure power supplies. To avoid these pitfalls, Emera is calling for a staged and phased approach to opening electricity markets in Nova Scotia to competition. A main consideration is protecting the significant electricity price advantage Nova Scotia enjoys relative to other parts of northeastern North America.

Chris Huskilson, Chief Operating Officer of Emera's electric utility subsidiary Nova Scotia Power, said "We want to encourage power generation for Nova Scotia from a diversity of fuel sources and new technologies such as renewables, small scale generators, gas-fired generators, co-generation and power from independent power producers. Opening our markets here to competition will support those developments and enable exports of electricity."

Emera's proposal for electricity market competition calls for a staged approach. The first step would entail opening competition for Nova Scotia Power's wholesale customers, which consist of six municipal electric utilities, serving approximately 7,000 customers and representing approximately $10 million in annual electricity sales. These customers would have the option of purchasing electricity from other suppliers including suppliers outside the province. Nova Scotia Power would develop transmission tariffs for wholesale customers and exporters of electricity to facilitate this process.

Emera also proposes actions to support a transition to more open electricity markets including monitoring of initial levels of competition and reaction by customers, customer education around pricing, and streamlined regulatory processes.

Environmental considerations must be an integral part of the province's new energy strategy. Emera is calling for a coordinated approach to emission reductions and affirms its willingness to work with governments at all levels to address issues such as climate change. Nova Scotia Power, has a number of environmental initiatives underway including the development of wind power in Nova Scotia, the development of a "green power" program for residential customers, burning of natural gas and the addition of cleaner technologies.

"One of the overwhelming requests from participants in the government sponsored task force hearings has been the desire for more "green power" and more energy from renewable sources. Nova Scotia Power is responding to this need expressed by Nova Scotians. In the future a greater percentage of our energy requirements will come from "green power" and other environmentally friendly options", said Mr. Huskilson.

About Emera

Emera Inc. (TSE-EMA) is a diversified energy and services company, with 440,000 customers and $3.2 billion in assets. Its wholly-owned operating subsidiary, Nova Scotia Power Inc., is a regulated electric utility that supplies over 95% of the electric generation, transmission and distribution in Nova Scotia. Emera also delivers bunker oil, diesel fuel and light fuel oil through its unregulated subsidiaries; has a 12.5 per cent interest in the Maritimes & Northeast Pipeline, which delivers Sable Island natural gas to markets in Maritime Canada and the northeastern United States; and an 8.4% interest in the Sable Offshore Energy Project offshore platforms and sub-sea field gathering lines. Emera is in the process of gaining final regulatory approval for the acquisition of all of the common shares of Bangor Hydro Electric Company (NYSE:BGR), a regulated electric transmission and distribution business serving 110,000 customers in Maine.