Newfoundland and Labrador Hydro (Hydro) released its financial results for the third quarter of 2024 today.

Key highlights

• Hydro’s profit on a year-to-date basis from January to September 2024 was $336 million, an increase of $23 million compared to profit of $313 million for the same period in 2023.
• The key drivers of the increase are:
  • The net impacts of commissioning of the Lower Churchill Project (LCP) assets in Q2 2023 and increased energy sales as a result of a short-term energy sales agreement.
  • The increases are partially offset by the usage of $90 million of internally generated funds to reduce the 2023 balance in the Supply Cost Variance Deferral Account (SCVDA), lower oil revenue and an increase in operating costs.
  • With commissioning of the LCP assets, additional revenue was realized by the LCP portion of the business due to the sale of power to Hydro’s regulated utility portion of the business as per the Project’s original power purchase agreement. Hydro’s regulated utility in turn recorded these costs in the SCVDA for future recovery, resulting in no impact to Hydro’s regulated utility net income. The additional revenues had an impact on Hydro’s overall consolidated net income.
  • The total 2024 rate mitigation funding applied was $240 million. This consisted of the $90M of internal funds applied in June 2024 and $150M from the second drawing of the federal convertible debt in August 2024, both in accordance with the rate mitigation plan. These reduced consolidated net income by $240 million and settled $240 million owing in the SCVDA. The use of Hydro’s funds for rate mitigation will contribute to keeping electricity rates lower, but will also reduce Hydro’s net income.

• Hydro experienced a loss of $53 million for the third quarter (July-September 2024). This is an increase of $34 million compared to a loss of $19 million in the same quarter in 2023.
• The key drivers of the increase in loss for the quarter relates to:
  • Higher operating costs and a decrease in volume of Nova Scotia Block energy delivered.
  • These decreases are partially offset by increased energy sales as a result of a short-term energy sales agreement.

Links:

The Quarterly Financial Report can be found here: https://nlhydro.com/2024-third-quarter-financial-results/

Media Contact:

Jill Pitcher
Team Lead, Public Affairs
c. 709-689-9938 e. nlhydromedia@nlh.nl.ca