$1.5-bn Muskrat Falls - Nova Scotia sub-sea cable link gets regulator nod

Nova Scotia's Utility and Review Board (UARB) has approved a proposal to build a 180-km sub-sea cable known as the Maritime Link from Newfoundland to Cape Breton to ship hydroelectricity from Muskrat Falls in Labrador to Nova Scotia.

Nova Scotia Power's parent company, Emera Inc, is a minority partner in the Muskrat Falls project and is responsible for the cable, which may see as much as 40 per cent of the electricity from the 824 MW project moved to Cape Breton by sub-sea cables. The deal calls 20 per cent of the power produced for Emera.

The project has received environmental approvals from the Canadian government and the provinces of Nova Scotia, Newfoundland and Labrador.

The board's decision hinges on Nova Scotians getting the best price for surplus electricity based on market conditions.

Emera said it needs time to study the implications of the board's decision, while Nalcor said its obligation is to get the best value for its excess power because the Muskrat Falls project is being built first and foremost for the benefit of ratepayers in Newfoundland and Labrador.

The utility is still reviewing the decision and Emera does not have the surplus power it needs from Muskrat Falls, Nalcor president Ed Martin told a news conference in St. John's, adding that Nalcor is one option for providing some additional power.

The board says the 180-kilometre cable represents the lowest long-term cost alternative for electricity ratepayers in Nova Scotia if Nalcor Energy can guarantee access to additional amounts of hydroelectricity to meet Nova Scotia's needs at market price.

The project will see ratepayers footing the bill for the next 35 years. Emera said the project will add $1.50 per month to the average household's power bill over the first five years.

Earlier the project was criticised by several big businesses saying that it is too risky to be locked in for over three decades. In their opinion, Emera should take the financial hit, not ratepayers.

The board was asked to decide whether constructing the Maritime Link was the cheapest long-term alternative for the users.

Emera has said that the project will stabilise electricity rates. It argued that Muskrat Falls will serve about 10 per cent of Nova Scotia's power needs, bringing clean energy into the province.

Nova Scotia's opposition parties have also voiced their objections to the proposal, saying it warranted greater scrutiny by the government.

The construction of Muskrat Falls is underway in Labrador with the $7.7-billion venture scheduled to generate power by 2017.