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Emera tells Nova Scotia regulators Muskrat Falls electricity is coming 'soon'

·4 min read
Emera is trying to recover the $1.7 billion it spent to carry electricity from Muskrat Falls in Newfoundland into Nova Scotia. (Jacques Boissinot/Canadian Press - image credit)
Emera is trying to recover the $1.7 billion it spent to carry electricity from Muskrat Falls in Newfoundland into Nova Scotia. (Jacques Boissinot/Canadian Press - image credit)

It was déjà vu all over again at the Nova Scotia Utility and Review Board Monday.

Once again, regulators were assured that electricity from the troubled Muskrat Falls hydro project in Labrador will soon flow into the province at contracted volumes — but no one would say exactly when it will happen.

"It's not days. We're talking over the next few months that that's all going to come to pass," said Rick Janega, CEO of Nova Scotia Power Maritime Link.

CBC
CBC

Electricity has yet to arrive but final bill is in

The Emera subsidiary is appearing before the regulator seeking to fully recover its costs to build the Maritime Link. Some $1.7 billion has been spent to carry electricity generated at Muskrat Falls across portions of Newfoundland and under the Cabot Strait via subsea cables into Nova Scotia.

Nova Scotia Power (NSP) is guaranteed 20 per cent of Muskrat Falls output — the so-called Nova Scotia Block — plus additional electricity at market prices.

NSP Maritime Link wants $169 million for the Link from its ratepayers in 2022. The amount has already been rolled into rates.

Waiting on Muskrat Falls to deliver

The Maritime Link has been ready to go since 2018 but Emera's partner in the project, St. John's-based Nalcor has failed to deliver contracted volumes.

Nalcor Energy
Nalcor Energy

Persistent software bugs have delayed commissioning of Nalcor's transmission system, the Labrador Island Link.

The first delivery of the Nova Scotia Block only started to flow on August 15 — three and half years late and in volumes well below the amounts approved by the Utility and Review Board in 2013.

Company assurances challenged

The Maritime Link CEO told regulators it's coming.

"Energy deliveries over the Maritime Link will continue to ramp up and all of the energy to which Nova Scotia customers are contractually entitled will begin to arrive in the coming months, as well as when needed by Nova Scotia Power," said Janega.

Janega was politely challenged by lawyer Bill Mahody, representing Nova Scotia Power residential customers.

Mahody reminded Janega he had made similar, unfulfilled, assurances in previous hearings.

"What is the basis of your confidence today that the Labrador Island Link is near completion, as opposed to the confidence that you expressed in 2017 at that interim assessment hearing?" asked Mahody.

"It's based on facts," Janega responded. "And the facts that I have available today in front of me are different from the facts that were available at the time.

"If we can get the software continuing to progress the way we've seen it and and even the pace of it starting to pick up, I'm sure we'll be sitting here with Nova Scotia Block flowing soon and the make up energy soon as well."

New delivery schedules not disclosed

Nova Scotia Power vice-president David Landigran told regulators Nalcor has recently provided updated delivery schedules "that would see commencement in the near future and redelivery also in the near future."

He declined to disclose the dates, saying he would provide them in confidential sessions during the hearings.

Nova Scotia getting 'a fraction' of promised electricity

Customer groups are questioning whether Emera should be entitled to full cost recovery when the Maritime Link has yet to deliver the promised levels of electricity.

Nalcor delivered 54,000 megawatt hours from Muskrat Falls between August and November 2021.

Nalcor Energy
Nalcor Energy

Janega did not question nor correct assertions that the Nova Scotia Block should have produced 262,000 megawatts during the same period, with another 48,000 in supplemental energy.

"What has in fact been delivered is only a fraction of the agreed-upon amount. It also carries other contractual and cost implications for Nova Scotia's ratepayers," said Nancy Rubin, a lawyer for Nova Scotia Power industrial customers.

Rubin also said she understood that Nova Scotia Power will soon file a general rate application for new power rates.

Defending those incentives

NSP Maritime Link also wants ratepayers to pick up $1.4 million in charitable donations and $12.3 million in incentive and bonus compensation paid to executives during the construction of Maritime Link.

NSP Maritime Link consultant John Reed argued that 92 per cent of compensation was tied to construction costs.

Given that Emera brought the project in on time and on budget, it's fair to ask ratepayers to pay for incentives that benefited them, he said.

"What I'm saying is the efficiencies, the cost reductions, the benefits in terms of delivering the project on time on budget — slightly below budget — all those benefits flow directly to customers," Reed said in response to questions.

"Every dollar saved is a dollar less that customers will ultimately have to pay."

Five days have been set aside for the public hearings.

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