N.L. Hy­dro pro­poses $206.2-M cap­i­tal bud­get in 2018

PUB sub­mis­sion in­cludes five-year con­struc­tion, main­te­nance plans

The Aurora (Labrador City) - - EDITORIAL - BY ASH­LEY FITZ­PATRICK

ST. JOHN’S, NL — The cap­i­tal spend­ing at New­found­land and Labrador Hy­dro — on ev­ery­thing from gen­er­a­tor re­pairs to new ve­hi­cle pur­chases — passes through an an­nual ap­proval process at the Pub­lic Util­i­ties Board (PUB).

Spend­ing is watched closely, as util­ity costs get fac­tored into power rates. More money spent on main­te­nance and up­grades leads to more be­ing re­quested from ratepay­ers. At the same time, cap­i­tal work is re­quired to main­tain ser­vice and re­li­a­bil­ity.

For 2018, Hy­dro has pro­posed $206.2 mil­lion in spend­ing. It’s not a his­toric high.

It cov­ers 68 new projects, plus cash re­quire­ments for al­ready-ap­proved, multi-year projects. The list in­cludes, but is not lim­ited to: main­te­nance work at the Holy­rood power plant; up­grades for iso­lated diesel-power plants on the Labrador coast; and a trans­mis­sion con­nec­tion be­tween ter­mi­nal sta­tions at Muskrat Falls and Happy Val­ley-Goose Bay.

The PUB is re­view­ing the plans.

Shift­ing bud­gets

The cap­i­tal bud­get in re­cent years has gen­er­ally run higher than in the early 2010s and prior to that. In 2011, as re­ported at the time, there were ob­jec­tions filed with the PUB from the con­sumer ad­vo­cate and var­i­ous in­dus­trial power users based on fore­casted in­creases in cap­i­tal spend­ing by Hy­dro, ex­pected to reach roughly $150 mil­lion in 2014-15.

This spend­ing is, af­ter all, sep­a­rate from di­rect spend­ing on the Muskrat Falls project, with costs there also set to hit ratepay­ers.

At the time, the PUB stated it was con­cerned with what it would mean for power rates.

The lat­est five-year fore­cast sug­gests Hy­dro’s cap­i­tal pro­gram is at least not set to con­tinue to rise.

“The to­tal in­vest­ment of cap­i­tal in trans­mis­sion and ru­ral op­er­a­tions fa­cil­i­ties will be­gin to see a re­duc­tion in ex­pen­di­tures af­ter 2018, pri­mar­ily as a re­sult of the com­ple­tion of ma­jor trans­mis­sion projects, in­clud­ing the up­grade of the trans­mis­sion line cor­ri­dor be­tween Bay d’Espoir and Western Avalon, the in­stal­la­tion of the trans­mis­sion line be­tween Sol­diers Pond and Hard­woods, and the pro­posed 2018 project for in­ter­con­nec­tion be­tween Muskrat Falls and Happy Val­ley,” the sub­mis­sion states.

By 2020-21, the prov­ince’s power sys­tem — the Hy­dro in­fra­struc­ture — will be ex­pected to make the switch from a large amount of diesel-fuel power from Holy­rood dur­ing peak de­mand to mainly hy­dro­elec­tric power.

Hy­dro de­liv­ers power di­rectly to in­dus­trial, util­ity and house­hold cus­tomers in New­found­land and Labrador, while also act­ing as the main sup­plier for New­found­land Power.

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