Nova Scotia officials are exploring options to secure a more stable natural gas supply and are issuing a request for proposals (RFP) to examine challenges on price volatility and meeting gas demand now and into the future.

The province’s price for natural gas tripled in December, mostly because of offshore supply issues and availability from the Massachusetts market, said Energy Minister Charlie Parker. Nova Scotia’s gas prices dropped slightly in January, but the spike still was noticeable, especially for large users, according to Parker.

Encana Corp.’s long-delayed Deep Panuke gas project offshore Nova Scotia, scheduled to be flowing gas for this winter heating season, has been delayed until the middle of this year (see Daily GPI, Nov. 19, 2012).

“Natural gas is an important part of the province’s plan to further diversify our energy mix to include several sources like wind, tidal, biomass and hydroelectricity,” said Parker. “It also helps us reduce our dependence on dirty, expensive coal and move toward cleaner and more renewable sources.”

The RFP would help the province “meet our federal coal requirements to reduce greenhouse gas emissions by 2030 and lead to lower, more stable electricity prices for Nova Scotians over the long term.” Switching to gas may cut energy costs and reduce harmful emissions, reinforcing “the need to identify the factors that impact access and how to address them,” Parker said.

Dalhousie University’s Jeff Lamb, assistant vice president of facilities, said the provincial university achieved substantial savings when it converted to gas several years ago.

“However, a variance in the price of natural gas like we experienced in December is a huge issue for us, and we had a $400,000 budget variance for that month alone,” said Lamb. “Instability of that magnitude takes money away from the primary educational mission of the university and any steps the provincial government can take to ensure price stability, such as a study of this nature, is heartily supported.”

The study, due by the end of March, would:

Heritage Gas provides natural gas to 20,000 households and businesses, including hospitals, universities and energy-intensive industries in Nova Scotia, according to the Energy Ministry. Last year the government allowed heavy power-using industries without access to natural gas to receive compressed natural gas by truck.

More information on the RFP, which was to be issued on Wednesday, is at

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