Excerpt from National Post Article – July 11, 2018
And how much will that cost the rest of Canada?
“And looming over all of this is Muskrat Falls, the disastrous energy mega project that’s threatening to drain the budget and wreck the economy even further.
Back in 2010, the hydroelectric dam at Muskrat Falls in Labrador was supposed to be a clean, renewable investment which would stabilize electricity rates and generate revenue by selling surplus electricity to the New England energy markets.
Maybe it would have been a good idea, if the government had managed to build the dam for $6.2 billion as originally forecast, but it’s looking like a catastrophe now that cost overruns have driven the total cost to an estimated $12.7 billion. This is in a province with only about half a million people; a hypothetical comparable project in Ontario would have started at $161 billion, and with overruns driving it to around $330 billion.
And because of revised electricity demand forecasts, it now looks like the province maybe didn’t need to build the project at all.
Things have gotten so bad that the provincial government just launched a public inquiry into the whole debacle before construction on the project has even finished.
Newfoundland and Labrador is now trying to figure out the best way to subsidize electricity rates, because if ratepayers have to bear the full cost of Muskrat Falls, it would mean that electricity rates would shoot up so dramatically that it would only do further damage to an economy that’s already struggling.”