The intrepid labradore takes yet another slice at the official government rationale for Muskrat Falls by showing the electricity rates Nalcor has been charging for the period 2005 to 2009.
He’d probably have used more recent information but – as labradore notes in this post – Nalcor stopped releasing the information as part of its annual report.
Funny that, given that the last year they gave information is the year Nalcor signed a deal with Emera to ship excess power to the United States through Quebec. Yes, that’s right: Hydro-Quebec will gladly ship power across its lines to real customers.
In any event, the rate chart undermines the provincial government’s claim that Muskrat Falls is the insurance against wildly uncontrollable increases in rates because oil prices will drive the cost of electricity on the island to astronomic heights.
The “utility” rate went up by 25% from 2005 to 2009 but if you look more closely the largest jump was before oil prices spiked in 2008. In the period 2007 to 2009, when oil prices shot up so dramatically, prices went up by about 1.3%.
Rub the sleep out of your eyes and read that again if you must.
Then look at those export rates.
Little better than half the domestic rates.
And it certainly is not making any profit for Nalcor.
Things won’t be any better lucrative if Nalcor builds Muskrat Falls and starts trying to sell the power it generates at a cost of something around 14.3 cents per kilowatt hour. One Vermont utility signed a deal with Hydro-Quebec recently for 25 years of power at less than six cent’s a kilowatt hour.
Sure that’s double what Nalcor got in 2009 and likely gets in early 2011 under the Emera deal but it is less than half of the cost of Muskrat power. of course that’s the current estimated cost of Nalcor power. If Muskrat costs more than the $6.2 billion the current Tory administration predicts then the cost per kilowatt hour will be more than 14.3.
And that Vermont utility – now owned by Fortis, incidentally – will still be paying less than six cents per kilowatt hour.
Keep rubbing those eyes until they bleed and the Muskrat math doesn’t get any better. Bit like being in a dream, isn’t it?
But no matter what you do and where you go, the figure with the bendy arms, tattered shirt and knives for fingers just won’t go away.
“One, two, Kathy’s coming for you…”