News / Halifax

Delays in construction at Muskrat Falls impacting Nova Scotia power bills

The construction site of the hydroelectric facility at Muskrat Falls, Newfoundland and Labrador is seen on Tuesday, July 14, 2015.

THE CANADIAN PRESS/Andrew Vaughan

The construction site of the hydroelectric facility at Muskrat Falls, Newfoundland and Labrador is seen on Tuesday, July 14, 2015.

HALIFAX — Nova Scotia Power customers will be getting some money back over the next three years as a result of the delays in completing the Nalcor-owned Muskrat Falls generating station in Newfoundland and Labrador.

The Nova Scotia Utility and Review Board has given NSP Maritime Link Inc., a subsidiary of Emera Inc., approval to charge Nova Scotia Power and its customers for costs related to the construction of the Maritime Link — the transmission system to get the power from Muskrat Falls.

The Maritime Link is expected to be complete by the end of this year, on time and on budget, however power from Muskrat Falls isn't expected to flow until 2020 at the earliest.

The review board's interim assessment, released Monday, is for $109.5 million in 2018 and $111.5 million in 2019. The amounts are already being collected from customers in Nova Scotia as part of a three-year rate stability plan for 2017-2019.

However, the board ruled that $105 million in costs should not be recovered yet, and as a result, ratepayers should receive an annual credit on their power bills over the next three years. The actual credit will vary by customer class.

The first credit is to be issues by April 30, 2018.

"The board is concerned about the significant delays in construction of the Muskrat Falls Generating Station and NSP Maritime Link Inc.'s apparent lack of insight on what is happening at Muskrat Falls," the board says as part of its decision Monday.

"Essentially, NSP Maritime Link appeared to learn about the delay contemporaneous with it being announced publicly, yet at the same time its representatives sit on joint committees with representatives of Nalcor dealing with this project. The lack of insight is troubling to the board."

The board said the Nova Scotia block of power was supposed to be flowing from Muskrat Falls at the same time the Maritime Link is completed, but for now "N.S. ratepayers are not getting what they bargained for."

"The board orders that the Maritime Link depreciation and deferred financing amortization credits be refunded to customers by April 30 of each year, plus interest," the decision reads.

In June it was announced that the price tag for the Muskrat Falls hydro project in Labrador had reached $12.7 billion. That's up from an estimate last year of $11.7 billion and is about $5 billion higher than when the former Progressive Conservative government approved Muskrat Falls five years ago.

Nalcor Energy CEO Stan Marshall took over as head of the Crown corporation last year after the governing Liberals criticized oversight. He said at the time the megaproject was a colossal mistake that he'd try to fix.

At the time, he said 75 per cent of construction was done.

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