Muskrat Falls will generate 824 megawatts of power. The 40 per cent for the Avalon’s power needs equates to 330 megawatts plus Emera’s 20 per cent power block equals 165 megawatts, for a combined total of 495 megawatts, or 500 for simplicity sake. Remember that 824 megawatts is the rated Muskrat Falls output, not the average, and certainly not the lowest output in winter when we need the most power.
The average output of Muskrat Falls quoted by various source is 600 megawatts to somewhere in the low 700s, thus leaving about 200 megawatts of non-committed power to play around with.
Spot market prices range from three to four cents per kilowatt hour, also the range mining giants will look for in Muskrat power.
One megawatt of power generates 8,760,000 kilowatt hours of electricity in one year, so 200 megawatts at four cents a kilowatt hour equals $70,080,000 in revenue annually. Multiply that by 50 years, and you get $3.5 billion (the maximum total) — thanks for not even paying off the interest payments of Muskrat Falls!
Muskrat power will be 10 cents to generate and another 10 cents for transmission to the Avalon. Mines in Labrador will be getting power at six cents per kilowatt hour less than its cost to generate, and Avalon ratepayers will be forced to make up the difference.
Twenty (that’s being liberal) cents per kilowatt hour for 330 megawatts plus six cents for 200 megawatts (discounted/subsidized power) equals residential rates of 23.6 cents per kilowatt hour.
Nalcor humoured us in quoting 15.4-cent power from Muskrat Decision Gate 2 numbers. Muskrat power is going to cost at least 8.2 cents more per kilowatt hour than ratepayers were initially told.
Many of the opponents of Muskrat said 20 cents or more power represents the lower scale of this megaproject.
Emera receiving power at less than its cost to produce will further add to Avalon ratepayers’ woes.
Nalcor demand forecasts are out to lunch for the Avalon — prices more than doubling our current rates will equate level or increasing demand?
The St. John’s Bored of Trade doesn’t seem to recognize the simple economics of steep rate hikes on electricity. Customers will have less money to spend and the cost of producing goods/services will have to go up.
As for the supposed House of Assembly debate involving MHAs only, it’s not fooling anyone, Dunderdale and Co.! Why not have a public forum where Nalcor and the other “experts,” hired or consulted on for Muskrat can be questioned? Invite people from the oil, natural gas, wind, financial, construction, legal industries, scientists, engineers, chartered accountants, etc., to attend.
Nalcor — taxpayers, not Progressive Conservative members, are your shareholders. Lest you forget or your organization be absolved, dismantled and be the subject of a royal commission.
Alec Campbell writes from Mount Pearl.