Halifax Water’s revised rate proposal is still rate shock, says consumer advocate

Interveners in Halifax Water’s rate case are telling the regulatory board that the utility’s new proposal, which would cut its initial request by nearly half, is still inordinately high.

The board-appointed consumer advocate said Halifax Water “may be closer” to finding a balance between recouping necessary costs and keeping rates reasonable and affordable, but he still has concerns.

Halifax Water applied to the Nova Scotia Regulatory and Appeals Board in the spring for two rate hikes amounting to more than 35 per cent between January and April 2026. The regulator said that would constitute “rate shock” and ordered the utility earlier this month to bring the figure down.

Halifax Water returned with a new proposal for two smaller increases that would compound to about 18 per cent over the same time period.

“Arguably, this still amounts to ‘rate shock,’” consumer advocate David Roberts wrote in a letter to the board this week.

Roberts stopped short of suggesting whether the board should accept or reject the utility’s new proposal but said it’s clear “new rate strategies must be employed” if steep rate hikes are to be avoided in the future.

He pointed to several measures the board has ordered, including seeking relief from some payments Halifax Water is required to make to Halifax Regional Municipality, and exploring whether HRM can absorb some of the utility’s financial shortfalls that are driving up its deficit.

Halifax Water has said it’s been keeping rates artificially low since the pandemic and cannot continue doing so because it’s facing inflationary pressures and needs to make costly infrastructure upgrades.

Roberts acknowledged that infrastructure improvements and other expenses are necessary to keep water services at a level that “customers expect and deserve.”

“However, the rates customers are required to pay to generate that revenue must be reasonable and affordable,” he added.

The consumer advocate is not alone in lodging its concern about Halifax Water’s revised rate proposal.

The landlord-advocacy group Rental Housing Providers Nova Scotia is calling on the board to cut the cumulative increase in 2026 to 10 per cent, and order Halifax Water to negotiate a settlement agreement on rates with stakeholders for 2027 to 2031.

Kevin Russell, the group’s executive director, told the board in a letter that the revised rate is “far too high and represents an increase more than six times the current rate of inflation.”

Killam Apartment REIT, one of the province's largest landlords, said the revised rates would still strain household affordability.

The board is expected to release a decision about the revised rates in the first few days of the new year.

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