Key takeaways:
- Consumer advocate states cost recovery is appropriate but P.C. opposition slams timing.
- The Muskrat Falls hydroelectric project is years behind plan and billions over funding.
With their July electricity bill, Newfoundland Power clients have started paying for Muskrat Falls, though accounts haven’t significantly raised — yet.
In a July newsletter, Newfoundland Power stated electricity bills were set to fall by 6.4 percent as part of the yearly rate stabilization adjustment, reflecting the electricity generation price.
Instead, that decline has been offset by a 6.1 gain in electricity rates so Newfoundland and Labrador Hydro can start recovering the price of Muskrat Falls. This $13-billion hydroelectric megaproject is billions over budget and years behind schedule.
For residential clients, electricity rates will drop to 12.346 cents per kilowatt, though the basic customer charge will increase from $15.81 to $15.83. According to an N.L. Hydro representative, nearly six percent of electricity bills will now go toward a “rate relief fund.”
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The spokesperson said N.L. Hydro anticipates the rate increase to result in $43 million this year — a tiny fraction of the project’s price.
N.L. Hydro requested the Public Utilities Board to agree on the rate increase in May. In a letter, Energy, Industry, and Technology Minister Andrew Parsons defended the increase, though he requested N.L. Hydro keeps electricity rates “as close to current levels as possible.
Region modifies order in council
Muskrat Falls is not yet entirely online — primarily due to software issues with the Labrador-Island Link transmission line — and a charge in council dictated that ratepayers on the island of Newfoundland would not start paying for the project till the project was utterly commissioned.
The regional government changed that order in council, so N.L. Hydro can start collecting fees associated with Muskrat Falls once the project is “nearing” commissioning.
Source – CBC News
