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Nova Scotia’s New Commercial Net-metering Regime

Published:

November 10, 2022

Author(s):

• Melanie Gillis, Lawyer
• Noah Entwisle, Lawyer
• Peter L'Esperance, McInnes Cooper Alum

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Updated August 8, 2023.

October 2022 amendments to the N.S. Renewable Electricity Regulations ushered in a new Commercial Net-metering regime in Nova Scotia. Building on April 2022 amendments to the N.S. Electricity Act, the amended regulations eliminate the 100 kW cap long-considered a barrier to wider adoption of Nova Scotia’s net metering program, positioning Nova Scotian businesses to develop up to 1 MW of on-site renewable energy, and allowing swathes of new program participants to reduce their electricity bills and hedge against future price increases. In addition, the amendments have the potential to accelerate the decarbonization of the N.S. electricity grid and help achieve Nova Scotia’s net-zero by 2050 targets, contribute to increased grid resiliency, and create new markets for Nova Scotia’s burgeoning renewable energy industry (particularly for solar).

Industry participants and organizations interested in developing larger scale renewable energy projects under Nova Scotia’s revised net-metering program will be paying close attention to how Nova Scotia Power Incorporated (NSP) and the Nova Scotia Utility and Review Board (UARB) implement these regulatory amendments to create a new commercial net-metering regime. Here are the highlights of the April and the October 2022 amendments and the new regime they create.

Nova Scotia’s Net-metering Program

Since 2010, Nova Scotia’s net-metering program has provided a proven channel for Nova Scotian homeowners, businesses, and institutions to install renewable electricity systems. Specifically, the metering program allows Nova Scotia Power Incorporated customers to:

• Install and interconnect eligible renewable energy generators to the grid. Eligible technologies include wind, solar, tidal and biomass; currently, solar photovoltaic represents the overwhelming majority of renewable energy generators installed under net metering programs.
• Reduce their electricity bills by an amount equivalent to the amount of energy that they produce.
• Receive credit for any excess energy injected into the electricity grid.

Hundreds, if not thousands, of Nova Scotia Power customers have taken advantage of the net-metering program. However, while some commercial and institutional customers have participated in the net-metering program, to date most participants have been residential homeowners. A 100 kW cap on installed nameplate capacity has limited uptake by commercial and institutional players. Until now.

April 2022 Regulatory Amendments: Oversight & Accessibility

Effective April 22, 2022, the Nova Scotia Department of Natural Resources and Renewables announced amendments to the N.S. Electricity Act. The amendments expanded, protected, and built upon the Nova Scotia’s net-metering and other renewable electricity programs by, among other things:

• Eliminating the previous 100 kW nameplate capacity cap to enable more commercial and institutional customers to use the program.
• Prohibiting Nova Scotia Power from introducing any fee structures or system access charges that discourage participation in net-metering programs.
• Introducing provisions that subject Nova Scotia Power to greater regulatory oversight by the Nova Scotia Utilities and Review Board in administering the net-metering programs.
• Introducing a “right to self-generate” that enables any Nova Scotian to install up to 27 kW nameplate capacity of renewable electricity generation and storage equipment without NSP approval.

October 2022 Amendments: Expansion, Transparency & Efficiency

Effective October 28, 2022, the Nova Scotia Department of Natural Resources and Renewables announced amendments to the N.S. Renewable Electricity Regulations that, among other changes, create a more viable net-metering stream for commercial and institutional customers.

Increased Net-metering Cap from 100 kW to up to 1 MW of Nameplate Capacity. The amended regulations allow eligible commercial, institutional, agriculture or aquaculture customers to install one or more eligible renewable energy generators of up to 1 MW (or 1,000 kW) of installed capacity per distribution zone. Eligible customers include:

• Customers that pay a demand charge as part of their existing rate (corresponding to ratepayers under the General, Industrial or Municipal Tariff Codes).
• Customers that own or operate a winery registered under the N.S. Agriculture and Marketing Act.
• Customers that own or operate a farm registered under the N.S. Farm Registration Act.
• Customers that own or operate a licensed aquaculture plant under the N.S. Fisheries and Coastal Resources Act.

All other customers can install eligible renewable energy generators of up to 200 kW of nameplate capacity per distribution zone. 

Streamlined Net-metering Application Process for Customers with Multiple Locations/ Generators. The amended regulations permit customers with multiple locations to install one or more renewable electricity generators under a single net-metering agreement, provided:

• The generators are all installed within the same distribution zone.
• The generators are all subject to the same rate or tariff.
• The total nameplate capacity of these generators doesn’t exceed the applicable caps set by the Electricity Act and the Renewable Electricity Regulations.

Enhanced Transparency & Regulatory Oversight. The amended regulations require Nova Scotia Power to increase the transparency of its net-metering program(s) by submitting both of the following for approval by the N.S. Utilities and Review Board by November 25, 2022:

• The terms and conditions of the program, including the requirements for participating in net-metering and the grounds on which Nova Scotia Power can deny an application.
• A standard form net-metering agreement that addresses the sale of renewable, low-impact electricity to NSP.

Nova Scotia Power isn’t permitted to make any further changes to its net metering program(s) without first obtaining the N.S. Utility and Review Board’s approval. Nova Scotia Power retains the right to approve or reject net-metering applications for installations with nameplate capacity in excess of 27 kW based on internally set policies and procedures, grid studies, and so on. However, the amended regulations subject Nova Scotia Power to greater regulatory oversight and accountability in its administration of the net metering program.

Accelerated Application Processing Times. The amended regulations specifically require Nova Scotia Power to process net-metering applications in a “timely” manner and approve all net-metering applications unless there are “reasonable grounds” to deny them. These changes serve as a legislative basis to expedite net-metering application processing times and reduce processing barriers to net metering application approval, system commissioning, and interconnection.

Registration of Renewable Energy Certificates. The amended regulations provide that, upon request by a customer, Nova Scotia Power must register all “renewable energy certificates” associated with a customer’s renewable energy generator(s) with an internationally accredited organization on an annual basis. Upon request by a customer, Nova Scotia Power must furnish the customer with renewable energy certificates describing the volume and vintage of renewable electricity generated by the customer’s generator(s) on an annual basis, at which time the certificates will be considered retired. The amended regulations further provide that Nova Scotia Power can count the total output of all renewable energy generated under a net-metering program and all residential net-metering customers to meet its renewable electricity performance standards. The interaction of these provisions suggests that commercial or institutional net-metered customers can apply the renewable energy certificates resulting from their renewable energy generator(s) against their internal renewable electricity performance and reporting requirements. Concurrently, Nova Scotia Power can apply the energy generated by all net-metered systems against its legislated renewable energy standard. If a commercial customer wished to register, sell, or assign the renewable energy certificates associated with its system independently, it must do so outside the context of the net-metering program.

July 2023 UARB Decision: Commercial Net-Metering Program Terms & Conditions Approval

On July 4, 2023, the UARB issued its Decision approving a modified version of the commercial net-metering program terms and conditions Nova Scotia Power submitted on November 25, 2022. In UARB proceeding number M10872 the Board considered Nova Scotia Power’s application and the input of various stakeholders. The Decision provides important clarifications and upholds the basic principles and objectives established in the October 2022 amendments to the Renewable Electricity Regulations, emphasizing:

• Prompt, efficient, and cost-effective processing of net-metering applications.
• Enhanced transparency and access to information for potential applicants.
• Enhanced accountability and regulatory oversight for Nova Scotia Power in the implementation of the new program.
• Incentivizing participation in the new program by giving participants control over renewable energy certificates obtained through participation in the program.

Please contact your McInnes Cooper lawyer or any member of our Renewable Energy Team @ McInnes Cooper to discuss how we can help you obtain the benefits of Nova Scotia’s new commercial net-metering regime.

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