120-574: Nova Scotia Power Inc. is a vertically integrated electric utility in Nova Scotia , Canada. It is privately owned by Emera and regulated by the provincial government via the Nova Scotia Utility and Review Board (NSUARB). Nova Scotia Power Inc provides electricity to 520,000 residential, commercial and industrial customers in Nova Scotia. The Nova Scotia Power Commission was formed in 1919 by
240-633: A submarine power cable across the Cabot Strait . In 2013, Nova Scotia Power signed an agreement to act as the agent of NSPML in commercial relationships with neighbouring utilities. Nova Scotia Power also agreed to provide transmission services for Nalcor Energy in Nova Scotia, allowing electricity to be traded among all four Atlantic provinces . An audit commissioned by the Nova Scotia Utility and Review Board (NSUARB) and conducted by Liberty Consulting Group in 2012 found that NSP overcharged its customers by $ 21.8 million because it paid too much for fuel over
360-682: A $ 13.4 million contingency. The project began in the fall of 2019 and NSP plans to be finished in 2021. NSPI has a generating capacity of 2,368 megawatts and produces 13,000 gigawatt hours of electricity each year. As of 2014, the utility operates 43 power stations , excluding wind turbines , using sources of energy including coal, petcoke , natural gas and renewables. 1987 (coal) NSPI also purchases energy from independent power producers who generate electricity using wind, hydro, and biomass (including landfill gas ). Notable examples include wind farms at Pubnico Point, Lingan, and Dalhousie Mountain. There are six municipal utilities currently operating in
480-651: A $ 447 million surplus – one of the largest in Nova Scotia's history and only the 7th time the debt was paid down since 1950. Major factors in recording this surplus were a one-time adjustment from the federal government of almost $ 200 million as well as an increase to the HST by two percentage points. However, Dexter's government also made several unpopular decisions, including removing the freeze on tuition fee hikes for Nova Scotia universities as well as budget cuts and freezes in public education and health care spending. The first year in office, Dexter and his NDP government sat in
600-635: A 16 MW wind farm in Hants County as co-owners of the Alternative Resource Energy Authority. The project is expected to help the towns' municipal utilities meet Nova Scotia's target of producing 25 percent of electricity from renewable sources by 2015, and to pay financial dividends to the three towns for the next 25 years. Vertical integration In microeconomics , management and international political economy , vertical integration , also referred to as vertical consolidation,
720-587: A block of hydroelectric power at a fixed price, the deal served the longstanding policy goal of reducing Nova Scotia's dependence on coal-fired generation. A new regulated utility registered in Nova Scotia, Nova Scotia Power Maritime Link Incorporated (NSPML), was formed to build and maintain the Maritime Link , including overhead power lines between the Granite Canal Hydroelectric Generating Station and Cape Ray, Newfoundland and
840-511: A degree in journalism from the University of King's College . He used his journalism degree for a period as a reporter for The Daily News in the early 1980s. Dexter also served in the Canadian Forces holding the rank of Sub-Lieutenant and was a Combat Information Officer on board HMCS Yukon and HMCS Qu'Appelle while deployed with Maritime Forces Pacific . Dexter was
960-490: A factor in determining whether vertical integration is successful. There are many problems and benefits that vertical integration brings to an economic system . Problems that can stem from vertical integration can include large capital investments needed to set up and buy factories and maintain efficient profits. Rapid technology development can increase integration difficulties and further increase costs. The requirement of different business skills venturing into new portions of
1080-549: A few days previously that were kept in ice remained in perfect condition. In 1924, Clarence Birdseye patented the "Birdseye Plate Froster" and established the General Seafood Corporation. In 1929, Birdseye's company and the patent were bought by Postum Cereals and Goldman Sachs Trading Corporation . It was later known as General Foods . They kept the Birdseye name, which was split into two words (Birds eye) for use as
1200-557: A few months of the 2006 election, the NDP took a lead in opinion polls, which it held consistently until the 2009 election. The NDP and Liberals voted against a money bill on May 4, 2009, defeating the MacDonald government and hence forcing an election one year before it was due. By this time, the NDP had been leading in opinion polls for most of the last three years and was on target to win a minority government. The NDP looked to hold its support in
1320-416: A government agency founded in 2006, was recast as the agency responsible for "the planning, development, and co-ordination of policies and programs for energy efficiency and conservation, including public education and behavioural change" in 2009. A new non-profit agency, Efficiency Nova Scotia , was created in 2010 to offer demand side management programs previously offered by Nova Scotia Power. The agency
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#17330926638211440-444: A labour-friendly bill on First Contract Arbitration. The bill meant that if employees voted democratically to form a union but could not reach an agreement with their employer on a first-contract, then an arbitrator would create one to avoid a strike. Critics said the legislation showed the NDP was on the side of workers instead of business, while advocates pointed out that similar legislation exists across Canada regardless of which party
1560-403: A large share of farm receipts, formerly assumed to go to the operator's family". Under production contracts, growers raise animals owned by integrators. Farm contracts contain detailed conditions for growers, who are paid based on how efficiently they use feed, provided by the integrator, to raise the animals. The contract dictates how to construct the facilities, how to feed, house, and medicate
1680-452: A major retailer, and Essendant , a dominant wholesaler. Before a wave of deregulation at the end of 20th century, most electric utilities were vertically integrated and provided electric generation , transmission , distribution , and sales. These were not just conglomerates with a common accounting department: there was just one profit center in sales, and costs of transmission and distribution were not separated. Partial deregulation in
1800-548: A member of the Community Planning Association. In September 2015, Dexter joined Global Public Affairs as Vice Chair. Dexter is married to Kelly Wilson and together they have one son. Dexter was elected to the Nova Scotia Legislature as MLA for Dartmouth-Cole Harbour in 1998 and served as critic for Economic Development and Health. He was re-elected in 1999, 2003, 2006 and 2009. Dexter became
1920-714: A national ship building contract to the Halifax shipyard. Dexter's NDP government continued to sit in the legislature for double the days of the previous government. Significant legislation in the second year included creating the province's first debt-cap for university students, a tax reduction for small business, an Auditor General Act giving that office more power and access to information, an indefinite moratorium on oil and gas exploration on Georges Bank, and Canada's first "Lemon Law" which requires used car dealers to give buyers more information. Two decisions saw significant opposition during Dexter's second year as Premier. The first
2040-641: A new application for provincewide installation of the meters, including a cost-benefit analysis, which it will submit to the board sometime this summer" i.e. before September 2017. On June 12 2018 the Nova Scotia Utility and Review Board approved the application by Nova Scotia Power to install new Smart Meters throughout the Province at a cost of up to $ 133.2 million. Project costs included all computers systems, installation costs, communications, administration and financing as well as new meters. Costs also included
2160-646: A one-to-one basis on January 1, 1999. Common shares in NS Power Holdings Inc. began trading on the Toronto Stock Exchange and Montreal Stock Exchange on January 6, 1999. The NS Power Holdings Inc. name was changed to Emera Incorporated on July 17, 2000. In the wake of major winter storms in 2004, NS Power came under increasing criticism from the Union of Nova Scotia Municipalities, energy-oriented public interest groups, and provincial political parties for
2280-402: A perceived lack of investment in the monitoring, preventive maintenance and instrumenting of its electric grid. A study was eventually commissioned from SNC-Lavalin to explore a "regional system operator" to relieve NS Power of the control of the grid, but Nova Scotia Power remains a single, vertically integrated utility as of 2014. Concerns were raised by the Nova Scotia government regarding
2400-473: A portion of the syndication revenues in order for a show to gain a spot on the schedule if it was produced by a studio without common ownership. In response, the studios fundamentally changed the way they made movies and did business. Lacking the financial resources and contract talent they once controlled, the studios now relied on independent producers supplying some portion of the budget in exchange for distribution rights. Certain media conglomerates may, in
2520-774: A practicing lawyer before he entered public life. He was first elected as a Dartmouth City Councilor, serving from 1994 to 1996. A former Chair and member Board of the Dartmouth Downtown Development Corporation, Dexter was also once a member of the Dartmouth General Hospital Commission, Chair of the Dartmouth Common Committee, a former member of the Board of Directors of the Victorian Order of Nurses (Dartmouth Branch), and
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#17330926638212640-535: A preamble that supported including collective bargaining as part of the Freedom to Assemble, while advocates argued that the committee was required by law to consult with businesses and that the preamble had been in the Canada Labour Code since 1972. The government amended the bill to guarantee non-unionized businesses are consulted on potential labour changes affecting matters including union drives. The 2011 budget
2760-417: A report stating that many Nova Scotia politicians had filed expense claims that were "excessive or inappropriate" because of inadequate spending controls that invite errors and misuse. Lapointe's report found that politicians had used taxpayers' money to buy items including televisions, cameras and other electronic equipment, custom-made furniture, model boats, and espresso makers. Lapointe's report questioned
2880-557: A rise of 4 percentage points. The NDP also won seats in the South Shore region, where it had not performed well in previous elections, specifically in Shelburne and Queens . Dexter was Opposition Leader to both premier John Hamm and Rodney MacDonald of the PCs . He credited his ability to work with Hamm to get things done as the reason for the NDP increase in seats in the 2006 election. Within
3000-809: A similar manner, own television broadcasters (either over-the-air or on cable), production companies that produce content for their networks, and also own the services that distribute their content to viewers (such as television and internet service providers). AT&T , Bell Canada , Comcast , Sky plc , and Rogers Communications are vertically integrated in such a manner—operating media subsidiaries (such as WarnerMedia , Bell Media , NBCUniversal , and Rogers Media ), and provide " triple play " services of television, internet, and phone service in some markets (such as Bell Satellite TV / Bell Internet , Rogers Cable , Xfinity , and Sky's satellite TV and internet services). Additionally, Bell and Rogers own wireless providers, Bell Mobility and Rogers Wireless , while Comcast
3120-497: A slower information processing rate, with the side effect of making the company so slow that it could not react quickly. Birds Eye did not take advantage of the growth of supermarkets until ten years after the competition did. The already-developed infrastructure did not allow Birdseye to quickly react to market changes. In order to increase profits and gain more market share, Alibaba , a China-based company, has implemented vertical integration deepening its company holdings to more than
3240-505: A supply chain. Operational routines also become more consistent and certain as the management of these firms gradually merge. Vertically integrated firms rarely need to worry about the sufficiency in their supply of materials because they generally control the facilities that provide them. A vertically integrated company also creates high barriers of entry into their respective economy, eliminating most potential competition. Implementing vertical integration can be beneficial in that it reduces
3360-451: A system in which mass production was most efficient. The model called for the manufacture of additional devices, all of which had carefully-curated designs by Ford engineers. Instead of passing these instructions and duties off to external manufacture firms, vertical integration was exercised within the corporation. This allowed for manageable division of labor, decreased costs in delay and exchange of goods, and organized updates of each firm in
3480-538: A target of 40% renewable energy by 2020. In December 2009, at an international summit in Copenhagen, Dexter was awarded a Climate Leadership in Canada award for putting a Greenhouse Gas Emissions Cap on electricity in Nova Scotia. In Dexter's first year as Premier two significant stories caused controversy for the NDP government and Nova Scotia's MLAs. On February 3, 2010, Nova Scotia auditor general Jacques Lapointe released
3600-416: A trademark. Birdseye was paid $ 20 million for the patents and $ 2 million for the assets. Birds Eye was one of the pioneers in the frozen food industry. During these times, there was not a well-developed infrastructure to produce and sell frozen foods. Hence Birds Eye developed its own system by using vertical integration. Members of the supply chain, such as farmers and small food retailers, could not afford
3720-773: A two-year period. The audit was heavily redacted when first released in July 2009, but the NSUARB ordered the release of the unredacted report in September 2009, arguing that it would not harm NSP's ability to carry on its business. As NS implemented its climate and demand side management strategies, lobbyists questioned whether the Nova Scotia Power could be trusted to administer a province-wide conservation program designed to prevent having to build any large, new power plant. Its "integrated resource plan" of 2007 indicated that energy conservation
Nova Scotia Power - Misplaced Pages Continue
3840-464: A vertically integrated strategy has helped Apple become a leading platform company; integrating their software (through APIs for third-party application developers) with their own hardware, across all the devices and services they offer. Vertical integration allows Apple to control production from beginning to end. Other companies may follow the Apple model, but may not see success for some time, both due to
3960-566: A way of keeping emergency health services in rural Nova Scotia, reduce the price of prescription drugs for people on Medicare, provide tax relief by increasing the Basic Personal Amount, and give more money to people living on income assistance. Critics suggested the projected deficit was higher than it should be as a way of the government providing good news when the deficit turns out to be lower and called for more cuts and faster cuts, while Dexter's government said unpredictable conditions in
4080-703: A way to reduce power costs for customers served by the municipal utilities. NSP had not piloted smart meters as of April 2013. As of 2014, time-of-day power rates are only available for customers using approved electric thermal storage heating systems, who pay between 14 and 19 cents/kW·h on-peak and 7.3 cents/kW·h off-peak. The rates and necessary metering equipment have not been offered to other customers who requested them. Dalhousie Professor Dr. Larry Hughes argues that they should be more widely deployed to encourage conserving power on peak, ensuring that electric vehicles and other discretionary devices charge off-peak, and otherwise levelling usage. An increasing amount of power
4200-618: A year while introducing a student debt relief plan, and maintaining balanced budgets. On election night, Dexter and the NDP did make small gains in the popular vote and won four more seats, including two in Dartmouth, one in Cape Breton and one in Pictou County , and the PC government of John Hamm was reduced to a minority . The MacDonald Government called an election for June 13, 2006, and Dexter
4320-533: Is a form of vertical integration when purchasing departments take over the former role of wholesalers to source products. For vertical integration to succeed, managers must be able to adapt their managerial approach to compliment the changes in functional activities that their vertical shift accompanies. Managers should make sure that their firm can take advantage of existing functional knowledge through organisation, and simultaneously allow new functional knowledge to develop. However, environmental possibilities can be
4440-458: Is a more efficient business with lower costs and more profits. On the undesirable side, when vertical expansion leads toward monopolistic control of a product or service then regulative action may be required to rectify anti-competitive behavior. Related to vertical expansion is lateral expansion , which is the growth of a business enterprise through the acquisition of similar firms, in the hope of achieving economies of scale . Vertical expansion
4560-432: Is also known as a vertical acquisition. Vertical expansion or acquisitions can also be used to increase sales and to gain market power. The acquisition of DirecTV by News Corporation is an example of forwarding vertical expansion or acquisition. DirecTV is a satellite TV company through which News Corporation can distribute more of its media content: news, movies, and television shows. The acquisition of NBC by Comcast
4680-459: Is an arrangement in which the supply chain of a company is integrated and owned by that company. Usually each member of the supply chain produces a different product or (market-specific) service, and the products combine to satisfy a common need. It contrasts with horizontal integration , wherein a company produces several items that are related to one another. Vertical integration has also described management styles that bring large portions of
4800-449: Is an example of an industry in which without vertical integration, would not be able to develop efficiently. In order to implement a telecommunications system that connected cities across a nation reliably, vertical integration was called upon. This strategic move ensured that the wiring, manufacture, and management of the system was consistent and functional across a state. Apple has used the vertical integration strategy for 35 years and
4920-819: Is an example of backward vertical integration. For example, in the United States, protecting the public from communications monopolies that can be built in this way is one of the missions of the Federal Communications Commission . Scholars' findings suggest that a reduction in inefficiencies caused by the market vertical value chains, including downstream prices or double mark-up, can be negated with vertical integration. Application in more complex environments can help firms overcome market failures (markets with high transaction costs or assets specificities) Scholars also identified potential risks and boundaries which may occur under vertical integration. This includes
Nova Scotia Power - Misplaced Pages Continue
5040-503: Is an important element to meet the future electricity needs of Nova Scotia. NS Power began implementing Energy Efficiency & Conservation programs (EEC) for customers in 2008. Conservation programs for large commercial and industrial electricity users were the first to be launched by NSP, in May 2008. Although electric utilities across Canada commonly administer similar programs, lobbyists accused NSP of potential conflicts of interest, because it
5160-440: Is coming from wind which is generated at unpredictable times, either on or off peak, suggesting a dynamic electricity pricing scheme might be required and thus a more functional fully networked power grid far beyond the capabilities of typical "smart meters". In June 2017 NSP withdrew its application for a pilot project to test wireless smart meters, under criticism from consumer advocates. It instead proposed that it "would prepare
5280-475: Is in power, reduced the number of work stoppages, and did not lead to job losses in other provinces. The second controversy involved his government's work to try to save the forestry and pulp and paper industries in the province. While both opposition parties eventually voted for the legislation to help the paper mill in Queens County, some criticized the move to protect jobs as too costly while others applauded
5400-674: Is led by an independent board of directors and regulated by the Nova Scotia Utility and Review Board. Its programs are funded by a DSM Cost Recovery Rider (DCRR) on customers' power bills that varies according to each customer's rate class and energy consumption. The average residential customer pays $ 63 per year for conservation programs as of 2014. Average payments by medium industrial customers dropped from over $ 200/month in 2012 to just over $ 100 in 2013 and 2014. For 2012, ENS claimed that it "helped Nova Scotians save $ 100 million in electricity costs. Energy savings totalled 141.8 million kilowatt hours, enough electricity to take 14,000 average homes off
5520-473: Is one method of avoiding the hold-up problem . A monopoly produced through vertical integration is called a vertical monopoly : vertical in a supply chain measures a firm's distance from the final consumers; for example, a firm that sells directly to the consumers has a vertical position of 0, a firm that supplies to this firm has a vertical position of 1, and so on. Vertical integration is often closely associated with vertical expansion which, in economics ,
5640-587: Is one of the most successful companies in the technology industry. Apple centered its business strategy on its own development of integrated hardware, software, and latterly services. They design most of their products in-house, and do not allow their hardware and operating system to be licensed out, which allows the company to apply its company vision to its products. Large companies such as Apple are more likely than smaller companies to employ vertical integration, as they have more resources to manage each stage of production (e.g. major expansion and funding). Implementing
5760-402: Is partnered with Verizon Wireless for an Xfinity-branded MVNO . Similarly, Sony has media holdings through its Sony Pictures division, including film and television content, as well as television channels, but is also a manufacturer of consumer electronics that can be used to play content from itself and others, including televisions, phones, and PlayStation video game consoles. AT&T
5880-402: Is removed and a corporation has the power to control all firms in its supply chain. One benefit is that the implementation of vertical integration can yield increased profit margins or eliminate the leverage that other firms or buyers may have over the firm. It allows improved coordination between production and distribution firms and decreases the cost of exchange of goods between firms within
6000-481: Is the first ever vertical integration where a mobile phone company and a film studio company are under same umbrella. Vertical integration through production and marketing contracts have also become the dominant model for livestock production. Currently, 90% of poultry, 69% of hogs, and 29% of cattle are contractually produced through vertical integration. The USDA supports vertical integration because it has increased food productivity. However, "... contractors receive
6120-491: Is the growth of a business enterprise through the acquisition of companies that produce the intermediate goods needed by the business or help market and distribute its product. A firm may desire such expansion to secure the supplies needed by the firm to produce its product and the market needed to sell the product. Such expansion can become undesirable from a system-wide perspective when it becomes anti-competitive and impede free competition in an open marketplace. The result
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#17330926638216240-462: The Bell System , Apple , the U.S. entertainment studios, the U.S. meat industry, Ford Motor Company , CVS , and Amazon demonstrate vertical merging. Other examples like Alibaba and EssilorLuxottica cover vertical integration in other nations. During a hunting trip American explorer and scientist Clarence Birdseye discovered the beneficial effects of " quick-freezing ". For example, fish caught
6360-526: The Metro Halifax area, and make gains on the South Shore and rural mainland Nova Scotia. Dexter campaigned on a document called Better Deal 2009 which came with 50 promises to be completed over 4 years, and focused on 7 key commitments of creating new jobs, helping to keep emergency rooms open, taking the HST off of home electricity, fixing rural roads, helping seniors, giving young people a reason to stay in
6480-485: The Mountain West , Great Plains , and Southeast . An economic theory is a framework that defines how a particular economic system functions. Economists develop principles in which an economy adheres to, which provides insight onto the relationships between economic events, markets, companies, and the government. In economic theory, vertical integration has been studied in the literature on incomplete contracts that
6600-584: The Nova Scotia Utility and Review Board (NSUARB). The proposed charges would have been a one-time "exit fee" payable by the municipal utilities in exchange for ending NSP's monopoly on the wholesale supply of electricity. The NSUARB found that a 2005 agreement that allowed third-party suppliers to sell power over NSP's grid gave the municipal utilities the right to purchase power from third parties without paying an exit fee, as long as their businesses did not substantially change or expand. In 2014, Mahone Bay , Antigonish , and Berwick signed an agreement to develop
6720-544: The Town of Lunenburg Electric Utility (TLEU) initiated a smart meter pilot project. Participating customers were provided with meters that could record power consumption in real time, and a wireless network was set up to communicate with the meters. Municipal Electric Utilities of Nova Scotia Cooperative Ltd. and the Nova Scotia Department of Energy had previously studied ways to reduce or shift demand during peak times as
6840-467: The "Little Three", Universal Studios , Columbia Pictures , and United Artists , produced and distributed feature films but did not own theaters. The issue of vertical integration (also known as common ownership) has been the main focus of policy makers because of the possibility of anti-competitive behaviors affiliated with market influence. For example, in United States v. Paramount Pictures, Inc. ,
6960-550: The $ 215.8 million deficit anticipated in the province's fiscal plan, and projected a surplus in the next year. As Dexter's third year as Premier came to an end, two long-time colleagues announced they would not re-offer when the next election is called. Transportation and Infrastructure Minister Bill Estabrooks and Finance Minister Graham Steele stepped down from Cabinet and were replaced by Antigonish MLA Maurice Smith and Nova Scotia's first ever female Finance Minister Maureen MacDonald. The fourth year of Dexter's government included
7080-505: The 8th leader of the Nova Scotia NDP in June 2001 when he took over as interim leader after Helen MacDonald stepped down. He ran for the leadership against John MacDonell in 2002 and won with 63% of the vote. In Dexter's first provincial campaign in 2003, the NDP campaign trailed in third place in many polls and was in danger of losing seats. The NDP looked to consolidate its strong support in
7200-727: The Eastern Interconnection. Nova Scotia Power has not announced any plans for a direct interconnection with the United States as of 2014. On November 18, 2010, Nova Scotia Power's parent company, Emera , announced a $ 6.2 billion deal with Newfoundland and Labrador's Nalcor Energy to develop the Phase 1 of the Lower Churchill Project, including transmission infrastructure to bring power to Nova Scotia from Muskrat Falls , Labrador . By providing long-term, guaranteed access to
7320-530: The Maritime Link project, which would bring in hydroelectricity from Newfoundland at a fixed rate over 35 years. Opponents suggested Nova Scotia should move slower on renewable energy, or import energy from Hydro-Québec instead. Proponents of the deal said it was a made-in-Atlantic-Canada solution, would put Nova Scotia into an "energy loop" and allow the province to meet both its green-house gas emissions requirements and renewable energy targets. The 2012 budget
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#17330926638217440-512: The Metro Halifax area, and make gains in the conservative rural mainland and Cape Breton . Dexter campaigned to form Crown Corporation for car insurance to lower premiums by 50%, paying for health coverage in nursing homes, reducing waiting lists for surgeries and diagnostic tests, removing the provincial portion of the HST on home heating oil, increase classroom resources for public schools, freezing tuition fees for Nova Scotia universities for
7560-580: The NDP collapse to only 7 seats, reducing it to third party status in the legislature behind Stephen McNeil 's Liberals and the PCs. This was mainly due to a near-wipeout in Halifax, the party's power base for almost two decades; the NDP went from holding 14 of the capital's 20 seats to just two. Dexter ran in Cole Harbour-Portland Valley , essentially a reconfigured version of his old seat, and lost to Liberal candidate Tony Ince by only 21 votes. He
7680-422: The NDP's four-year plan to stop Nova Scotia's unsustainable spending through both economic stimulus and holding the line on department budgets. The budget also pledged to open more Collaborative Emergency Centres, help the poor and disabled, provide more needs-based grants to university students, and invest heavily in rural road and highway repair. The budget projected a deficit of $ 211.2 million, slightly better than
7800-439: The Nova Scotia Utility and Review Board for approval to spend $ 23 million on conservation programs in 2010. The spending was offset by a reduction in power rates under Nova Scotia's fuel adjustment mechanism due to lower-than-expected oil and gas prices in 2009. Public consultations held in Nova Scotia in 2008 produced a report recommending the creation of an independent demand side management administration. Conserve Nova Scotia,
7920-480: The Supreme Court ordered the five vertically integrated studios to sell off their theater chains and all trade practices were prohibited ( United States v. Paramount Pictures , Inc., 1948). The prevalence of vertical integration wholly predetermined the relationships between both studios and networks and modified criteria in financing. Networks began arranging content initiated by commonly owned studios and stipulated
8040-473: The U.S. The vertical merge allowed CVS-Aetna to regulate more of the healthcare and delivery chain and gave them the ability to provide higher quality care to consumers. One of the most significant advantages to this integration is the reduction in costs for healthcare. Amazon.com has been criticized for being anti-competitive as both an owner and participant of its dominant online marketplace. In office products, Sycamore Partners owns both Staples, Inc. ,
8160-490: The US in 1978 ( PURPA ) forced the utilities to buy electricity outside if the rates were competitive; this gave rise to independent power producers . The other deviation from the vertical integration model were local distribution companies in some towns and regions. In the US 250 vertically integrated companies provided 85% of electrical generation. As of 2022, this "public utility" model was still utilized in some US states, mostly in
8280-411: The animals, and how to handle manure and dispose of carcasses. Generally, the contract also shields the integrator from liability. Jim Hightower , in his book, Eat Your Heart Out , discusses this liability role enacted by large food companies. He finds that in many cases of agricultural vertical integration, the integrator ( food company ) denies the farmer the right of entrepreneurship. This means that
8400-647: The appropriateness of the spending habits of all three main political parties. Dexter himself expensed $ 7,650 for a pair of laptops and a digital camera, while taxpayers picked up his annual $ 3,500 professional fee to the Nova Scotia Barrister's Society. Dexter later rejected a call for a public inquiry into the MLA spending scandal, saying that due to the Auditor General's report, excessive and inappropriate spending by MLAs would be curtailed. Dexter promised reforms to
8520-419: The bill's first stages would give power to labour unions, and they held up passage of the bill by several weeks. The bill combined the activities of six boards into one unified Labour Board and created a Labour Management Review Committee that consisted of managers and employees from unionized workplaces. Critics wanted non-unionized business people to have a say in how workplaces become unionized and worried about
8640-618: The controversial decision to sell the Crown corporation. This privatization created Nova Scotia Power Incorporated (NSPI). On December 2, 1998, NSPI shareholders voted to restructure the company to create a holding company which would be shareholder-owned, with the regulated utility being a wholly owned subsidiary of the holding company. On December 9, 1998, NSPI received approval to establish NS Power Holdings Incorporated and NSPI shareholders exchanged their shares in NSPI for shares in NS Power Holdings Inc. on
8760-399: The cost of entering the market and taking on the currently successful incumbent, but also by innovating their products to make them more appealing in the marketplace than the current incumbent. Vertical integration requires a company to focus not only on its core business, but also on several difficult areas such as sourcing materials and manufacturing partners, distribution, and finally selling
8880-405: The distance that separates the suppliers and customers from the resources or information, which can then boost profits and efficiency. There are internal and external society-wide gains and losses stemming from vertical integration, which vary according to the state of technology in the industries involved, roughly corresponding to the stages of the industry lifecycle. Static technology represents
9000-457: The e-commerce platform. Alibaba has built its leadership in the market by gradually acquiring complementary companies in a variety of industries including delivery and payments. One of the earliest, largest and most famous examples of vertical integration was the Carnegie Steel company. The company controlled not only the mills where the steel was made, but also the mines where the iron ore
9120-665: The entire value chain, but do not do everything in-house (e.g. assembly of iPhones by manufacturing partner Foxconn ). From the early 1920s through the early 1950s, the American motion picture had evolved into an industry controlled by a few companies, a condition known as a "mature oligopoly ", as it was led by eight major film studios , the most powerful of which were the "Big Five" studios: MGM , Warner Brothers , 20th Century Fox , Paramount Pictures , and RKO . These studios were fully integrated, not only producing and distributing films, but also operating their own movie theaters ;
9240-833: The expense system, and the first bill he introduced in the spring of 2010 was An Act to Establish a Management Commission for the Effective Administration of the House of Assembly, saying "I promised Nova Scotians that their demands for an open and transparent system for MLA expenses would be met." Three former and one incumbent Member of the Legislative Assembly , Liberals Dave Wilson , Russell MacKinnon , Progressive Conservative Richard Hurlburt , and former NDP turned Independent MLA Trevor Zinck were criminally charged for their involvement. The second controversy occurred on February 25, 2010, when Elections Nova Scotia fined
9360-556: The farmer can only sell under and to the integrator. These restrictions on specified growth, Hightower argues, strips the selling and producing power of the farmer. The producer is ultimately limited by the established standards of the integrator. Yet, at the same time, the integrator still keeps the responsibility connected to the farmer. Hightower sees this as ownership without reliability. Under marketing contracts, growers agree in advance to sell their animals to integrators under an agreed price system. Generally, these contracts shield
9480-493: The fuel to company-owned retail stations, for sale to consumers. Standard Oil is a famous example of both horizontal and vertical integration, combining extraction, transport, refinement, wholesale distribution, and retail sales at company-owned gas stations. Telephone companies in most of the 20th century, especially the largest (the Bell System ) were integrated, making their own telephones , telephone cables , telephone exchange equipment and other supplies. The Bell System
9600-482: The future of Nova Scotia Power and the province's renewable energy strategy in the aftermath of a tentative C$ 4.8 billion deal for the sale of most assets of NB Power to Hydro-Québec , on October 29, 2009. The government of Nova Scotia was concerned that the deal could affect its plan to develop renewable energy sources for exports to New England in competition with Quebec's publicly owned utility, as all existing transmission routes were through New Brunswick. The sale
9720-499: The general election held on June 9, 2009 and became the first NDP government in Nova Scotia, and the first in Atlantic Canada. He was sworn in as Premier of Nova Scotia on June 19, 2009. The Dexter government struggled for the first year of its mandate to control spending on public programs while increasing revenue. It paid off when Dexter's minister of finance Graham Steele posted the provincial budget on April 4, 2011, showing
9840-412: The governing Progressive Conservative Party , leading the first NDP government in Atlantic Canada and the second east of Manitoba . His government was defeated in the 2013 election , becoming the first Nova Scotia government in 131 years to be denied a second mandate; Dexter himself was defeated in his constituency by 21 votes. Dexter now serves as a lobbyist for the cannabis industry. Darrell Dexter
9960-482: The governing NDP $ 10,000, the maximum fine under the governing act, for accepting an illegal campaign donation from a trade union, referring the case to police. The agency said the NDP took more than $ 5,000 from a single donor and failed to return $ 45,000 from eight unions and one union affiliate, though it "knew or should have known" the money was all from the Mainland Building and Construction Trades Council. After
10080-602: The grid" on expenditures of $ 43.7 million - a total cost under $ 0.31 per kilowatt hour for permanent savings that recur year over year. The cash-on-cash return on investment province-wide is well over 100% for the entire history of Efficiency Nova Scotia. In October 2013 NSP announced it would extend Schneider Electric 's GIS technology with embedded OMS and DMS technologies to "efficiently monitor, analyze, and manage its network of nearly 500,000 customers for more rapid response to power outages." NSP accordingly appears to be following Schneider's blueprint for grid evolution. In 2013,
10200-411: The high cost of equipment, so Birdseye provided it to them. Until now, Birds Eye has faded slowly because they have fixed costs associated with vertical integration, such as property, plants, and equipment that cannot be reduced significantly when production needs decrease. The Birds Eye company used vertical integration to create a larger organization structure with more levels of command. This produced
10320-627: The incomplete contracting setup. In these extended models, vertical integration can sometimes be optimal even if only the seller has to make an investment decision. Darrell Dexter Darrell Elvin Dexter (born 1957) is a Canadian lawyer, journalist and former naval officer who served as the 27th premier of Nova Scotia from 2009 to 2013. A member of the Nova Scotia New Democratic Party , he served as party leader from 2001 to 2013. He became Premier in 2009 after his party defeated
10440-401: The integrator from liability for the grower's actions and the only negotiable item is a price. In the United States new automobiles can not be sold at dealerships owned by the same company that produced them but are protected by state franchise laws. Ford Motor Company vertically integrated due to high demand for their Model T automobile. With the development of Model T, the company required
10560-485: The introduction of a balanced budget, and significant debate over the Maritime Link project with the province of Newfoundland. Significant legislation in the fourth year included stronger protection for animals, cyber-safety laws, the Betty Bauman law, and reducing the small business tax for the fourth year in a row. One topic saw substantial debate throughout the year was the question of whether to move forward with
10680-404: The leaders' debate was improved in the eyes of many pundits. The NDP was returned once again as the official opposition, but did make major gains on election night. The party gained five seats for a total of 20, the best performance in its history. Dexter also was comfortably re-elected in his own seat of Cole Harbour with 59.5% of the vote. The NDP increased its share of the popular vote to 34.5%,
10800-563: The legislature for more days than the previous government's last four sessions combined; the Conservatives sat 15 days in the Fall of 2007, 21 days in the Spring of 2008, 16 days in the Fall of 2008 and 3 days in the Spring of 2009 when an election was called. Dexter's NDP government sat for 35 days in the Fall of 2009 and 32 days in the Spring of 2010. Legislative highlights in the first year included
10920-527: The moves to save the economies of the towns of Liverpool and Port Hawkesbury. In the end, the government support was not enough and the Bowater plant in Liverpool closed. The 2012 budget was tabled on April 12. Dexter made a surprise announcement the day before Finance Minister Graham Steele's budget, announcing that the HST would be reduced by 1 point in 2014 and a second point in 2015. The budget continued with
11040-434: The now merged company. Within healthcare systems, horizontal integration is generally much more prominent. However, in the United States, major vertical mergers have included CVS Health 's purchase of Aetna , and Cigna 's purchase of Express Scripts . The integration of CVS Health and Aetna resulted in the combination of one of the nation's largest health insurance companies with a pharmaceutical company seen all across
11160-406: The potential competitor, the enhancements to horizontal collusion, and development of barriers to entry. However, it is still debated over if vertical integration expected efficiencies can lead to competitive harm to the market. Some conclude that in many cases that the efficiencies outweigh the potential risks. Contrary to horizontal integration , which is a consolidation of many firms that handle
11280-442: The product. Another major success of Apple's, is the forward integration with their retail stores, allowing them to sell their products directly to customers (helping customers to buy and use Apple's products and services), additionally helping them to control the prices of their products, and thus to maintain high-profit margins when they do. Apple is also known as one of the world's leading "orchestrators" as they exert control over
11400-403: The province beginning to help cover the travel cost for out-of-province medical care, increasing funding to women's shelters for the first time in a decade, creating a Graduate Retention Rebate for graduates who stay in Nova Scotia, banning uranium mining and the use of cosmetic pesticides, banning political donations by unions and businesses, and launching a new renewable energy strategy with
11520-560: The province, and more renewable energy. On June 9, 2009, Dexter was elected the first NDP premier of Nova Scotia with a majority government . They held their support in Halifax and Cape Breton, and expanded their base on the South Shore, Pictou and suburban Halifax. The NDP won in the Annapolis Valley and Central Nova Scotia for the first time, winning the seats of Kings North , Kings South , Truro-Bible Hill , Colchester-Musquodoboit Valley and Cumberland North . Dexter's party won
11640-692: The province. The municipal utilities jointly own the Municipal Electric Utilities of Nova Scotia Cooperative Ltd. (MEUNS). Together, they serve under 15,000 people, or about 2% of the provincial population. The majority of the municipal utilities purchase electricity through an interconnection with Nova Scotia Power; however, some, including the Berwick Electric Light Commission, have supplementary generating assets such as small hydro stations. In 2012, MEUNS successfully opposed charges of $ 28–32 million that NSP had requested before
11760-408: The provincial government, following the lead of several other Canadian provinces in establishing Crown corporation electrical utilities. The commission constructed and opened its first hydro plant at Tantallon the following year. Throughout the 1920s-1960s, the commission grew as private and municipal owned hydro plants and electrical utilities went bankrupt or sold their assets. In 1960, Nova Scotia
11880-551: The release of the report, Dexter stated that he had believed the money had been returned. Party secretary Ed Wark resigned, citing a "serious error in judgment". The Dexter government used the second year of its mandate to continue to get spending under control while increasing revenue. Dexter also lobbied the federal government on helping with "nation-building" projects including the Lower Churchill Falls renewable energy project from Newfoundland to Nova Scotia and awarding
12000-631: The renamed Nova Scotia Power Corporation (NSPC). In 1984, NSPC opened the world's first tidal power generating station on the Annapolis River at Annapolis Royal . This technology, similar to hydroelectric dams , did not become globally widespread. In 1992, NSPC was privatized by the provincial government of Premier Donald Cameron in what was then the largest private equity transaction in Canadian history. Cameron's government had been under heavy pressure to control provincial deficits and debt servicing thus
12120-631: The same part of the production process, vertical integration is typified by one firm engaged in different parts of production (e.g., growing raw materials, manufacturing, transporting, marketing, and/or retailing ). Vertical integration is the degree to which a firm owns its upstream suppliers and its downstream buyers. The differences depend on where the firm is placed in the order of the supply chain. There are three varieties of vertical integration: backward (upstream) vertical integration, forward (downstream) vertical integration, and balanced (both upstream and downstream) vertical integration. Disintermediation
12240-506: The simplest case, where the gains and losses have been studied extensively. A vertically integrated company usually fails when transactions within the market are too risky or the contracts to support these risks are too costly to administer, such as frequent transactions and a small number of buyers and sellers. The following are several case studies of vertical integration in play. Many examples center around American industries, where major companies like General Foods, Carnegie Steel Company ,
12360-455: The steel processes to the next generation. Oil companies , both multinational (such as ExxonMobil , Shell , ConocoPhillips or BP ) and national (e.g., Petronas ) often adopt a vertically integrated structure, meaning that they are active along the entire supply chain from locating deposits , drilling and extracting crude oil , transporting it around the world, refining it into petroleum products such as petrol/gasoline , to distributing
12480-434: The supply chain can be challenging for the firm. Another problem that may stem from vertical integration is the collapse of goals among the various firms in a supply chain. With each firm operating under different systems, integration may cause initial problems in management and production. Vertical integration also proves to be dangerous when monopolistic problems arise in a capitalistic economy. When this happens, competition
12600-577: The supply chain not only under a common ownership but also into one corporation (as in the 1920s when the Ford River Rouge Complex began making much of its own steel rather than buying it from suppliers). Vertical integration can be desirable because it secures supplies needed by the firm to produce its product and the market needed to sell the product, but it can become undesirable when a firm's actions become anti-competitive and impede free competition in an open marketplace. Vertical integration
12720-598: The supply chain. Vertical integration enabled Ford Motor Company to be self-regulating and self-sufficient. EssilorLuxottica , the company that merged with Essilor and Luxottica , occupies up to 30% of the global market share as well as representing billions of pairs of lenses and frames sold annually. Before the merger, Luxottica also owned 80% of the market share of companies that produce corrective and protective eyewear as well as owning many retailers, optical departments at Target and Sears , and key eye insurance groups, such as EyeMed , many of which are already part of
12840-405: The third year included re-creating Nova Scotia's independent Arts Council, capping cellphone contract cancellation fees, scheduling a reduction in the HST by one point in 2014 and another point in 2015, and reducing the small business tax for the third year in a row. Two decisions drew substantial opposition during Dexter's third year as Premier. Both the Conservatives and Liberals tried to block
12960-491: The two parties will negotiate tomorrow about how to divide the returns of the investments. Since the owner is in a better bargaining position, he will have stronger incentives to invest. Hence, whether vertical integration is desirable or not depends on whose investments are more important. Hart's theory has been extended by several authors. For instance, DeMeza and Lockwood (1998) have studied different bargaining games, while Schmitz (2006) has introduced asymmetric information into
13080-630: The worldwide economy required caution and stated the opposition would need to explain where extra cuts would come from. The third year of Dexter's mandate brought significant news for the province. The Halifax Shipyard was awarded the federal shipbuilding contract, and the NDP announced an agreement with Newfoundland on the Lower Churchill project to bring hydroelectricity to Nova Scotia. Dexter's government also opened Canada's first Collaborative Emergency Centres to start to address emergency room closures in rural Nova Scotia. Significant legislation in
13200-517: Was born on September 10, 1957, in Halifax , Nova Scotia , to Elvin, a steel metal worker, and Florence Dexter (née Pace), and grew up in the rural community of Milton in Queens County . He was the first member of his family to go to university. Dexter volunteered for Alexa McDonough in her 1979 federal election campaign. Dexter holds degrees in education and law from Dalhousie University , and
13320-419: Was both a vendor of electricity and also the administrator of programs that, if successful, would reduce energy sales. The utility spent $ 11.9 million on conservation programs in 2008 and 2009. A third party evaluation confirmed that the programs had saved over 85 million kilowatt-hours of electricity, exceeding the utility's goal of 66 million kilowatt-hours. In April 2009, the utility applied to
13440-657: Was connected to the New Brunswick Electric Power Commission in the first electrical inter-connection between provinces in Canada. The Nova Scotia Power Commission underwent unprecedented expansion during the late 1960s when five new thermal generating stations were constructed to meet the growing residential and industrial demand in the province. On January 27, 1972, the Government of Nova Scotia acquired Nova Scotia Light and Power Company, Limited (NSLP), an investor-owned utility , leasing its assets to
13560-504: Was developed by Oliver Hart and his coauthors. Consider a seller of an intermediate product that is used by a buyer to produce a final product. The intermediate product can only be produced with the help of specific physical assets (e.g., machines, buildings). Should the buyer own the assets (vertical integration) or should the seller own the assets (non-integration)? Suppose that today the parties have to make relationship-specific investments. Since today complete contracts cannot be written,
13680-403: Was extracted, the coal mines that supplied the coal , the ships that transported the iron ore and the railroads that transported the coal to the factory, the coke ovens where the coal was coked, etc. The company focused heavily on developing talent internally from the bottom up, rather than importing it from other companies. Later, Carnegie established an institute of higher learning to teach
13800-467: Was his government's replacing an early learning program called Reading Recovery with Succeeding in Reading. Critics were concerned changing programs would hurt children's literacy, while advocates argued that the old program was too expensive and the new program would help more children in more grades. Business advocates were concerned that a bill that was barely debated by the opposition in the legislature in
13920-465: Was once again the NDP's candidate for Premier. At the outset, most pollsters had the NDP at the same level of support it had in 2003, roughly 30% and behind the Tories in second place. Dexter campaigned on a platform to improve services for seniors, lowering the cost of heating oil for homes, a 10% cut in post-secondary education tuition, subsidized child care and public auto insurance. Dexter performance in
14040-1037: Was reduced in scope due to public pressure in NB, then dropped entirely. The Shawn Graham government fell partly as a result of the failure of these deals and the lack of public consultation prior to pursuing them. In partial response to concerns about being cut off from the New England market, NS Premier Darrell Dexter began to pursue a "loop" strategy for Nova Scotia's electric interconnection, connecting Muskrat Falls in Labrador to Cape Breton , thence to mainland Nova Scotia and, via subsea DC transmission cable, New England. This would connect NL, NS and potentially PEI with its peers in FERC Eastern Interconnection directly without relying on Quebec or New Brunswick. Thus, any future deal to extend Quebec's ownership or Quebec's interconnection could not prevent dealings between peers in
14160-431: Was tabled on April 4, and presented a small surplus of $ 16.4 million, ending the NDP's four-year plan to get "back to balance". The budget also invested in more Collaborative Emergency Centres, insulin pump funding for children, expanded dental care coverage for children, expanded newborn screening, and tax breaks for low income seniors. The Dexter government was heavily defeated in the 2013 provincial election which saw
14280-594: Was tabled on April 5. Although the final figures for 2010 showed a surprising surplus, Dexter's Finance Minister Graham Steele estimated a deficit for 2011 of $ 389 million, and promised to continue with their 4-year plan to get Nova Scotia out of unsustainable spending through both economic growth and trimming department budgets. The NDP pledged to reduce debt servicing costs, expand their ban March Madness spending in departments, keep unbudgeted spending low and continue to review department programs. The budget also pledged to open Canada's first Collaborative Emergency Centres as
14400-427: Was the first sitting premier of Nova Scotia to be unseated in his own riding since Ernest Howard Armstrong in 1925. Eight other members of his cabinet were defeated. Dexter served as premier until his successor Stephen McNeil was sworn in as the 28th Premier of Nova Scotia on October 22, 2013, and later announced on November 16, 2013 that he would resign as NDP leader, effective November 23, 2013. As of 2017, Dexter
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