On the surface, Newfoundland and Labrador’s Muskrat Falls hydroelectric project looks like a mess, but the province’s premier says the project will, in the long run, benefit the province.
“No doubt, it is an expensive project. No doubt, right now is putting undue financial strain on our province in a very difficult time,” said Premier Dwight Ball, admitting the Muskrat Falls project should have been better planned.
“What we know about most hydro developments that over time … these things typically do have a way of making sure that they’re able to produce sustainable power for the long term,” he told The West Block’s Tom Clark.
But some critics have raised red flags about the hydro project, whose estimated costs have soared to $11.4 billion from $7.4 billion four years ago.
The CEO of Nalcor Energy, the provincial energy corporation, said earlier this month that Nova Scotia’s Emera Inc. will be getting electricity for “next to nothing” when Muskrat Falls starts producing electricity.
Stan Marshall said the poor arrangement with Emera is one of the reasons the project has proven to be a bad deal for Newfoundland and Labrador and will become an economic burden for the province.
Newfoundland and Labrador’s auditor general last week raised alarms about the province’s deficits, which reached $3.8 billion in just two years. Unemployment in the province is 14 per cent and expected to go up, and the revenues the government is taking in from oil have decreased more than 70 per cent from five years ago.
One idea to solve the province’s woes with Muskrat Falls that has been bandied about is to sell the project to Quebec, but Ball said that won’t happen.
“We will not be doing that. But what we will be doing is making sure that we put mitigating measures in place so that we can keep rates low for Newfoundlanders and Labradorians,” he said.
With a file from The Canadian Press