The Utilities and Review Board has ordered Nova Scotia Power to refund customers $250,000 for failing to live up to performance standards around service and reliability last year.
The fine is largely symbolic — the UARB has the authority to demand a penalty of up to $1,000,000 — but it has been levied to send a message to the power company it cannot use bad weather as an excuse not to serve people who depend on the monopoly for an essential service.
“Weather intensity is not a new phenomenon, nor is it an anomaly, since it has been observed for several years,” according to the written UARB decision signed by chair Peter Gurnham, vice-Chair Roland Deveau, and board member Stephen Murphy. “With that knowledge, it is incumbent upon NS Power to ensure that it has taken sufficient measures to improve the resiliency of its network to withstand higher stresses and improve, or at least maintain, overall service reliability. Performance standards were established to promote continuous improvement. Changing weather patterns should be viewed as a challenge for improving performance, not as a reason for accepting deteriorating performance levels.”
Section 52A of the Public Utilities Act requires the UARB to establish performance standards for NS Power in respect of reliability and response to adverse weather conditions. In 2019, the UARB found Nova Scotia Power failed to meet seven of these 13 standards.
The province-wide reliability performance for outage frequency (SAIFI) and outage duration (SAIDI) were both worse than the targets for those metrics. The SAIFI performance of 5.99 exceeded the target of 4.29, and the SAIDI performance of 2.58 exceeded the target of 2.05.
Although the power company reported fewer planned power outages in 2019 than in 2018, the duration of those planned outages jumped from 1.9 hours to 3.3 hours.
When will the lights come back on?
And NS Power is still having trouble predicting with any accuracy when power will be restored after a severe storm.
In 2019, NS Power managed 20,171 outage events, compared to 15,540 outage events in 2018. The increase in volume was attributed to the impact of Hurricane Dorian. According to the UARB decision letter ordering the penalty:
Figure 17 of the report shows the percentage of power outages where power was restored within plus or minus four hours of the communicated Estimated Time of Restoration (ETRs).
Figure 17 shows that the overall accuracy of ETRs for all outages in 2019 ranged from 55% to 69%. The accuracy improved when second or third ETRs were communicated, but little change was noted for subsequent ETRs. A similar trend was experienced in 2018, but the accuracy was better, ranging from 62% to 77%. The accuracy decreased by about 9% in 2019 over 2018, which NS Power attributed to the impact of Hurricane Dorian.
Nova Scotia Power Blames Dorian
In a letter accompanying its annual submission on performance standards to the UARB last February, Nova Scotia Power blamed damage sustained during Hurricane Dorian for some of these difficulties:
Never in NS Power’s history has the Company incurred a weather event of the magnitude of Hurrican Dorian. The impacts of Hurrican Dorian were province wide resulting in more outage events than the Company has experienced cumulatively over the course of a single year. Over 400,000 customers lost power due to the storm. Amongst the damage there was an estimated 7,000 instances of lines broken by trees or with trees leaning on them, and 375 broken or leaning poles.
As of September 30, 2019, nine of the 13 Performance Standards (Reliability, Customer Service, and Storm) are on track to achieve their 2019 targets. However, two standards in the area of Customer Service have been negatively impacted by Hurricane Dorian: (i) the annual percent of estimated bills; and (ii) regular business call answer rate. In addition to these two Customer Service standards, there are two reliability standards, namely the CKAIDI standard (circuit duration) and the CKAIFI standard (circuit frequency), that are trending to exceed the annual targets for two feeders in Cape Breton.”
NS Power said both of these transmission lines “are subject to extreme weather and are presently undergoing significant reliability investments, targeted to improve the reliability performance for the customers served.”
The 2019 report card on performance standards showed NS Power’s customer restoration performance results regarding Major Event Day (MED) and Extreme Event Day (EED) storms for 2019 and the two previous years. Table 4 below shows NSPI’s performance is improving when it comes to reaching a larger percentage of customers after a bad storm..
In conclusion, the UARB said:
The Board understands that NS Power has had to face some challenges in 2019. However, the performance standards were established under a comprehensive public process, with the intention of ensuring that customers are receiving an appropriate level of service for the rates and fees they are charged by the utility. It is not acceptable for the service levels to continue to decline and it is the Board’s view that in order to promote future compliance an administrative penalty is warranted. Accordingly, the Board assigns an administrative penalty in the amount of $250,000 to be credited to ratepayers via the Fuel Adjustment Mechanism process no later than September 30, 2020.