HALIFAX – Nova Scotia Power wants its regulator to approve a rate decrease for 2010.

On Friday, Nova Scotia Power, which is owned by Halifax-based energy company Emera (TSX-EMA), asked its regulator to approve lower electricity costs for the coming year.

If approved by the Nova Scotia Utility and Review Board (UARB), residential customers will see a rate decrease of 1.4 per cent, starting Jan. 1.

The rate cut is being offered because the utility spent less on fuel in 2009 than expected, said Alan Richardson, a Nova Scotia Power vice-president.

Essentially, the utility used less fuel – as well as cheaper fuel – than predicted. That means this year’s power rates were higher than required. So, the credit is being applied to rates in 2010.

Richardson said the economic downturn meant less power was consumed, particularly by industry. And low natural gas prices meant less reliance on pricy oil in 2009, notably at the Tufts Cove generating plant in Dartmouth.

But one public policy expert says New Brunswickers shouldn’t be jealous of that rate relief, because the pending sale of their public utility will help secure stable power rates for the long term.

Charles Cirtwill, of the Atlantic Institute for Market Studies, says the mild rate decrease is welcomed. But he insists it’s insignificant when compared to the rate relief that will soon arrive in New Brunswick.

Cirtwill, president of the Halifax-based think-tank, said the proposed sale of NB Power to Hydro-Québec will net New Brunswick plenty of cheap and reliable hydro power.

The tentative deal would see Hydro-Qu├ębec take over the bulk of NB Power. In return, New Brunswick would be freed of NB Power’s $4.75-billion debt.

And, residential power rates in New Brunswick would be frozen for five years, while industrial rates would be lowered to match those in Quebec.

Nova Scotia Power, meanwhile, is tied to the spikes and fluctuations that accompany the global oil supply, Cirtwill said.

For example, Nova Scotians have experienced five rate hikes in the past eight years.

“It goes both ways. If fuel prices jack back up, Nova Scotia Power can come back and ask for more,” Cirtwill said. “Nova Scotia is at the mercy of global pricing.

“But New Brunswick won’t have those ups and downs because water is the same price all the time.”

Without the sale of the public utility, however, New Brunswick power rates will continue to climb, as they have for years.

Premier Shawn Graham has said it’s essential to get the deal signed by March 31, or New Brunswickers will be subjected to a three per cent rate increase in 2010.

If approved, the Nova Scotia rate decrease in 2010 would range between 1.4 to 2.1 per cent for commercial customers, and 2 to 3.3 per cent for industrial customers.

The total rebate is expected to total about $22 million and equate to approximately $2.50 per month for the average residential customer. A hearing on the matter is scheduled for Dec. 2.

Nova Scotia Power has 1,700 employees, $3.5 billion in assets and close to 500,000 customers