Nova Scotia Power Inc.: Rating Report

DBRS Limited (DBRS) confirmed the Issuer Rating of Nova Scotia Power Inc. (NSPI or the Company) at A (low) and the ratings on NSPI’s Unsecured Debentures & Medium-Term Notes and Commercial Paper at A (low) and R-1 (low), respectively, all with Stable trends. DBRS also discontinued the Cumulative Preferred Shares rating of the Company since they have been repaid. NSPI’s business risk profile continues to be stable and is underpinned by the reasonable regulatory environment in the Province of Nova Scotia (rated A (high) with a Stable trend by DBRS) with no material regulatory or operational changes over the last year, its cost of service model and good franchise strength. NSPI’s financial risk profile also continues to be stable with key credit metrics commensurate with the current rating category. The Stable trends underscore DBRS’s expectation that NSPI’s credit quality will remain intact through the three-year rate stability period (2017 to 2019). While incremental renewable power purchase costs will likely result in an average rate increase higher than the projected rate increase during the rate stability period (1.0% to 1.5% yearly through 2017 to 2019), DBRS expects NSPI’s rate increase in 2020 to be manageable.