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NSPI Proposal: Manage Taxes, No Further Increase

Halifax, Nova Scotia, September 5 2002: Nova Scotia Power Inc. (NSPI) has filed a rate application with the Nova Scotia Utility and Review Board (UARB) proposing to manage substantially higher tax expenses, without a further increase in power rates. Nova Scotia Power is a wholly-owned subsidiary of Emera Inc. (TSX:EMA)

"Taxes are a success story for our company. We managed taxes effectively since privatization, which helped keep costs down," said Nova Scotia Power spokesperson, Margaret Murphy. "Now, we are proposing to deal with a substantial increase in taxes for 2003 without a further increase in power rates, beyond the increase already under consideration by the UARB."

A decision is pending on the company's 2002 rate application which requested an average rate increase of 8.9% to address high fuel costs and a weak Canadian dollar.

Nova Scotia Power's management plan addresses $81 million in taxes for 2003, a 138 % increase over 2002 levels. The higher taxes can be absorbed with the increase in power rates already requested, more moderate fuel costs for the upcoming year, and flexibility around the timeframe for writing down the retired Glace Bay generating station.
In today's application, Nova Scotia Power is also proposing an innovative, optional electricity rate. The rate allows the power company to work in partnership with extra large industrial customers to better manage energy costs and demand across the provincial power grid.

Today's filing builds on the company's Notice of Application, submitted to the UARB this past July.
Nova Scotia Power has been subject to federal and provincial taxes since privatization in 1992. In addition to federal and provincial income taxes, the power company pays large corporations tax, preferred dividend tax, provincial capital tax and municipal taxes. In 2003, taxes are increasing by $47 million, including a $37 million increase in income tax and a $10 million increase in municipal property tax.

About Emera Inc.

Emera Inc. (EMA-TSX) is a diversified energy and services company, with 550,000 customers and $4.0 billion in assets. The company has two wholly-owned regulated electric utility subsidiaries, Nova Scotia Power Inc. and Bangor Hydro-Electric Company. Nova Scotia Power supplies over 95% of the electric generation, transmission and distribution in Nova Scotia. Bangor Hydro provides electricity transmission and distribution service to 110,000 customers in eastern Maine. It is a member of the New England Power Pool, and is interconnected with the other New England utilities to the south and with New Brunswick Power to the north.

In addition, Emera Energy manages Emera's growing gas infrastructure investment portfolio, including its 12.5% interest in the Maritimes & Northeast Pipeline, which delivers Sable 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 Energy also incorporates Emera Energy Services, Emera Fuels, and Emera's business development activities.