Nova Scotia coal pollution cut becomes law

The federal government formally exempted Nova Scotia from expensive, coal fired greenhouse gas caps this week in a deal that allows Nova Scotia Power to keep coal fired electrical generation plants open while still reducing the province's carbon dioxide emissions.

The agreement is the first of its kind involving climate change in Canada.

It substitutes a plan, made in Nova Scotia, to reduce pollution for federal regulations that the province argued would raise power bills. A federal cost benefit analysis estimates that adopting the provincial plan will save Nova Scotia Power $87 million.

"This agreement with Environment Canada is groundbreaking and something of which Nova Scotians can be proud,"said JasonHollett, the director of climate change for the NovaScotiaDepartment of Environment.

"This is a precedent for how the nation may handle climate change going forward."

He said at worst, Nova Scotia's greenhouse gas emissions will be at least equal to those mandated under federal regulations.

"In fact, we believe reductions under our plan will be deeper," Hollett said.

Greenhouse gas caps in Nova Scotia's plan

• 7,500,000 tonnes by 2020
• 4,500,000 tonnes by 2030

Federal regulations would have effectively forced Nova Scotia Power to close six of its eight coal fired electrical generation plants by 2030.

A Pictou County plant in Trenton and another at Point Tupper in Cape Breton would be the first to be shuttered by Dec. 31, 2019.

Under the exemption that became law on Wednesday, Nova Scotia Power can keep its coal burning plants provided the company meets hard emission reductions.

In 2011, 53 per cent of electricity in Nova Scotia was generated by burning coal.

"The equivalency agreement, combined with the fact that we are on track with the provincial GHG and renewable energy requirements, allows us to get the best value from our investments on facilities and still meet the same objectives that GHG regs set out to achieve," Neera Ritcey, a spokeswoman for Nova Scotia Power, said in an e-mail to CBC News.

Imported hydro from Labrador the key

The Nova Scotia plan is based on a move toward electricity generated from renewable sources. It relies on the arrival of at least 20 per cent of the electricity generated from the Muskrat Falls hydroelectricity project in Labrador.

That electricity is expected to arrive in Nova Scotia in 2017.

Under this scenario, Nova Scotia Power will retire one of its coal fired plants and gradually reduce its reliance on coal over the next 15 years.

"This says you can keep coal units open but reduce their usage, firing them up during peak demand and seasonally shut them down," said Hollett.

Ottawa and Nova Scotia announced theirintention to reach a so-called "equivalency agreement" in 2012. The final deal was completed in the spring of 2014.