The Province of Nova Scotia is switching to renewable energy in pursuit of its climate goals, which are the most ambitious in Canada: to reduce emissions by 53 percent by 2030 and achieve net-zero emissions by 2050.
In December 2020, the province brought on Coho to administer large-scale renewable energy procurements on behalf of the provincial utility, Nova Scotia Power, and to develop a green tariff program. Through these projects, Coho and the province are expanding access to clean energy for both rate-paying residents and large-scale corporate buyers.
Procuring Clean Energy for Ratepayers
Coho is the appointed Procurement Administrator for Nova Scotia’s Rate Base Procurement program. Coho developed and administered a competitive request for proposals (RFP) process to seek the best value for Nova Scotia ratepayers. Coho also worked with the province to develop Power Purchase Agreements (PPAs) to award to the winners of the RFP process.
Administration of the RFP
Coho and Nova Scotia sought a fair, transparent, and competitive procurement. Coho led a uniquely thoughtful and inclusive approach to developing an RFP, with several objectives.
- Seek the best value for ratepayers: Coho’s primary objective was to design a procurement which provided the best value for Nova Scotia ratepayers. To achieve this, the price of energy was weighted most heavily during the evaluation of proposals. Further, Coho included requirements in the RFP to ensure that proposals were mature, well-priced, and considered the interests of local communities.
- Engage with a diverse set of stakeholders: In designing the project requirements outlined by the RFP, Coho engaged a diverse set of stakeholders, including independent power producers, Nova Scotia Power, the Utility and Review Board, provincial departments, NGOs, residents, and indigenous communities. This highly inclusive approach ensured the projects chosen by the province would balance and maximize a combination of economic, social, and environmental benefits.
- Design a scoring framework which balances stakeholder interests: The RFP encouraged the provision of low-cost solutions to ensure positive economic impacts to Nova Scotia ratepayers, while mitigating any environmental externalities. The RFP also successfully encouraged proponents to demonstrate their commitment to engaging with the public, including with indigenous Mi’kmaq communities, using the Nova Scotia supply chain and working with underrepresented communities within the energy sector.
- Collaborate with federal economic partners: The RFP was designed in collaboration with the Canada Infrastructure Bank and Natural Resources Canada’s Smart Renewable Electrification Pathways Program to provide developers with financial incentives such as low-cost royalty agreements and development grants.
Designing the Power Purchase Agreement
Coho drafted an initial PPA to be approved by Nova Scotia’s Utility and Review Board (UARB). Based on ongoing stakeholder engagement (including regular discussions with legal, accounting and audit, finance, risk, senior executives, and other key internal and external parties) and understanding of the province’s objectives and risk tolerance, Coho crafted commercial terms that reflected its desired outcomes. The PPA was shared with inside and outside counsel and the contracts team to vet and work through any contract language issues.
Digby Neck, Nova Scotia. Credit: Property#1/Flickr
Outcomes
Coho conducted extensive due diligence for the province, including interviews with developers, to evaluate proposals and determine the projects which most closely align with provincial priorities and interests. In August 2022, Coho announced that the Rate Base Procurement RFP would be awarded to five wind projects, totaling 372 MW of wind energy. The average energy rate was CAD $51.24, which is significantly lower than current energy costs in Nova Scotia, ensuring that ratepayers would save money on their energy bills because of this procurement.
Create a Green Tariff Program
Green tariff programs are offered by electrical utilities to allow their customers to buy renewable energy. Not all utilities offer green tariff programs, but they are gaining popularity in the US, Canada, and other markets.
In 2018, the federal government of Canada announced all federally owned facilities would be required to use 100% renewable electricity by 2025. Nova Scotia, which is home to several federally owned facilities, sought a green tariff program to more easily allow the federal government and corporates to buy renewable energy in the province.
Coho supported the green tariff program, known as the Green Choice Program (GCP), in three main ways:
- Program design: Coho conducted a landscape analysis of voluntary green tariff programs in Canada and the United States to identify preferences for large corporate and institutional (C&I) and federal energy buyers. Coho then worked with the province to design the Green Choice Program in accordance with provincial regulations.
- Marketing and stakeholder alignment: Coho conducted a variety of marketing efforts to circulate the program to potential C&I and governmental customers, including webinars and direct calls. As a result, the program achieved full capacity allocation.
- Structuring governing agreements. Coho, leveraging deep expertise in executing green tariff agreements and support from Stikeman Elliot, developed key agreements in the form of a Participant Agreement recognizing the obligations of the participant and utility as well as a Memorandum of Aggregation (MOA) recognizing the partnership amongst an aggregate.
Learn more about how Coho helps companies and utilities switch to clean, renewable power.
