ANTIGONISH: The electric utility in the Town of Antigonish is anticipating a deficit of $210,000 by the end of the fiscal year.
During the town’s regular monthly council meeting on Dec.19, Megan Barkhouse, Director of Corporate Services for Antigonish, made a presentation to council on the electric utility’s operating budget, highlighting the “small” deficit.
“The reason for the delay for this budget was the moving target of our power purchasing outside the Ellershouse Wind Farm. Through regular updates about the cost of purchasing energy, it’s clear the cost significantly increased in 2023,” Barkhouse told council. “This is the clear driver for our budget for this year.”
She indicated while the town is in the process of a cost of service study, the budget’s deficit, which has a fiscal year that ends on March 31, 2023, can be covered by previous year’s retained earnings.
“And when I say small, that’s relative to the revenue that we do get in from the electric utility,” Barkhouse said. “There is a deficit of $210,000 and that is due to power purchasing for January, February and March.”
Antigonish CAO Jeff Lawrence advised the biggest driver has been that the price of imported power has more than doubled.
“Our contract ends on Dec. 31, and the best option is to go back on the Nova Scotia Power municipal wholesale rate,” Lawrence said. “We do have approximately $2 million retained earnings from the electric utility; this represents about 10 per cent of that, so we can absorb it.”
The CAO suggested the town does need to do the rate study to make sure they continue to remain viable.
Two years ago, Lawrence highlighted the town tried to execute a five year deal on their rate of imports but explained they were lucky to maintain that import rate for a substantial period of time.
“We are looking at one bad quarter,” he said. “But it gives you some sort of idea the magnitude of the increase in wholesale power.”
Following the meeting, Lawrence told reporters that Antigonish is importing at the 2021 prices, which was before any of the disturbance between Russia and the Ukraine.
“Since that has happened, the rates for importing power have more than doubled, that’s no longer viable for us,” he said. “Our only other source for wholesale power is Nova Scotia Power. We’ll go on the wholesale rate as of January 1.”
When asked about the possibility of power rates increasing for town utility customers, Lawrence suggested that could be the outcome.
He highlighted that any potential rate study wouldn’t be effective before at least April, suggesting it depends on when the Nova Scotia Utility and Review Board would rule on the rate study.