Despite Hurricane Dorian, Covid-19, Emera Has ‘Transformative’ Year
HALIFAX — The company that owns Nova Scotia Power says business is good despite tough weather in 2019 and a global pandemic in 2020.
Emera Inc. owns Nova Scotia Power, along with several other power companies in Canada, the United States, and the Caribbean.
At the company’s annual general meeting on June 5, president and CEO Scott Balfour told shareholders 2019 was a “transformative year” for Emera.
The company sold off some of its major assets, including its gas plants in New England and its subsidiary company, Emera Maine (the sale of Emera Maine officially closed in March of this year).
Balfour said those sales “strengthened our balance sheet and … contributed to our strong share price in 2019.”
The gas plant sales also meant lower earnings for Emera in 2019. While the sales brought in billions of dollars of cash, the company did lose profits the plants would have generated.
Hurricane Dorian, as well as other poor weather conditions, also had a major impact on Emera’s bottom line in 2019.
However, the company’s annual report for 2019 said those impacts were “essentially offset” by its utility company’s strong performances.
The report said Emera’s focus on delivering value for its customers has allowed its share price to grow, “which supports our dividend growth and our ultimate goal of strong returns to our shareholders.”
‘Minimal Impact’ From Covid-19
Balfour told shareholders on June 5 that the company’s finances remain good, even in the face of the global Covid-19 pandemic.
“We are…fortunate that the Covid-19 pandemic has had minimal impacts on our first-quarter financial results,” he said.
He said that the overall strength of Emera’s portfolio of businesses, favorable weather conditions, and a “positive mix of sales by customer class” have all contributed “positively” towards the company’s financial success.
Balfour said Emera’s overall financial position also “remains strong,” pointing to the $2.2-billion raised from its gas plant sales and the company’s $3-billion worth of cash and available credit as proof.
As Covid-19 has continued to wreak havoc on the economy, some Canadian utilities have lowered their rates to help customers who are struggling financially.
Nova Scotia Power hasn’t taken that step. Instead, Balfour said the utility is “working to support customers” during the pandemic by “temporarily suspending disconnections, developing payments plans, and offering additional programs if needed.”
No quick transition to renewable energy
In his June 5 presentation, Balfour also spoke about Nova Scotia Power’s efforts to transition to more renewable energy.
In the 14 years between 2005 and 2019, the utility has reduced its greenhouse gas emissions by about 37 percent. As of 2019, about 30 percent of Nova Scotia’s power came from renewable sources, primarily wind.
The government of Nova Scotia has told the utility it needs to get to 40 percent renewable energy by 2022. Balfour says Nova Scotia Power will be able to hit those provincial standards—and could get as high as 60 percent renewable energy by 2023.
Most of the renewable energy Nova Scotia Power is counting on to meet that 60 percent goal won’t be generated in the province. Instead, it will be imported from the yet-to-be-completed Muskrat Falls hydroelectricity project in Labrador
The controversial project has been delayed several times since Nalcor Energy began building it in 2013. Covid-19 has delayed it even further, and Nova Scotia’s Energy and Mines Minister Derek Mombourquette says it likely won’t be finished in 2020.
Nova Scotia Power isn’t directly responsible for Muskrat Falls, but Balfour says he’s confident the project will be finished soon.
“Really, Muskrat Falls is almost done,” he said. “It’s very close to complete and there’s not much work that’s required to get that to full completion.”
Balfour did not give any specific dates on when the project could go online but said he believes it will be in the “near term.”
He added that, even if Nova Scotia Power does get to 60 percent renewable energy, “that still means that we’ve still got a significant portion of Nova Scotia Power’s energy which is based on coal.”
“Our plan is to progressively, slowly continue to work at reducing that coal generation over time,” he said.
He argued that a rapid, large-scale transition away from coal would be expensive for Nova Scotians because of the cost of replacing old infrastructure.
A slower transition, he said, will balance environmental concerns with affordability.