Newfoundland and Labrador Hydro receives Liberty report

December 18, 2014 – Ed Martin, president and CEO of Nalcor Energy, discussed the findings of an independent review released today on the provincial electricity system during a speaking engagement at the Board of Trade in St. John’s.

“We always welcome independent insight and are pleased that Liberty Consulting Group has recognized the significant work that has been accomplished by Hydro in terms of winter readiness and strengthening the system overall,” said Martin. “We have worked closely with Liberty during the review process.”

Hydro crews have completed a tremendous amount of maintenance and upgrade work on the existing provincial electricity system; well in advance of the cold weather. In terms of generation, major capital work has been completed on the Hardwoods and Stephenville gas turbines and the Holyrood plant, and on hydroelectric plants in locations such as Bay d’Espoir, Cat Arm and Hinds Lake.

Hydro fully anticipates it will be able to meet winter demand with its current generation supply. However, two additional security measures are in place. First, Hydro secured capacity assistance arrangements with industrial customers to make additional power available if needed. Secondly, Hydro is installing a new 120 MW combustion turbine plant that will provide additional generation reserve for the system.

In the report, Liberty states concern that there will be pressure on Hydro’s reserves until we are interconnected. However, Hydro’s reserve generation is comparable to other North American Utilities and will be above 15 per cent when the combustion turbine is installed later this month. As Liberty outlined, it is not economically prudent to add further additional generation at this time — considering the province will be moving from an isolated system to an interconnected electricity system in a few years.

“In the interim, Hydro will be closely and actively managing capacity between now and when Muskrat Falls is in full operation and we will continue to focus on ensuring the availability of all generation units,” said Martin. “Our team has been working diligently to get prepared for this winter; all critical maintenance on our transmission and generation assets was completed in advance of winter.”