There's a fight coming and Natural Resources Minister Jerome Kennedy was pretty clear in stating so at a meeting in Clarenville We d n e sd ay. Kennedy was the guest speaker at the Clarenville and Area Chamber of Commerce luncheon, and spoke on the $6.2 billion Muskrat Falls project. He said a lot of valid concerns have been raised regarding the project, but there were two main questions which had to be answered is the power needed, and is it the lowest cost option?
Kennedy said the Manitoba Hydro International independent review suggests the answer is yes for both. He said given the current rate of residential and commercial growth, the province could be experiencing blackouts by 2015. By 2020, Kennedy said, We will simply not have enough power. In reality, Kennedy said, there were two options for power development Muskrat Falls or refurbishing the Holyrood Thermal Electric station.
He said the independent review has suggested the Muskrat Falls project Holyrood option.
When it comes to electricity rates, he said, the average islander paid $179 a month for electricity last year. Estimates, because of increases in the price of oil, put the monthly bill at $217 per month by 2016. Muskrat Falls is scheduled to come online in 2017, and Kennedy said it will increase rates by $15 per increase by $14 over the next 13 years. He said the rates will be stable and eventually see a reduction, leaving the province with an asset. In exploring the Holyrood option, the facility can run at 18,000 barrels of oil a day.
Burning oil at $40 a barrel, he said, would triple the electricity rates compared to Muskrat Falls. government has taken flak over the House of Assembly not being open to discuss the issue, but that's about to change.
I can assure you that next week (when the house opens) we are ready, and anyone who has any questions on Muskrat Falls, bring it on, Kennedy said.