Ottawa hands N.L. $5.2 billion in funding for troubled Muskrat Falls hydro project
|CTVnews 28 Jul 2021 at 12:48|
ST. JOHN S, N.L. -- Ottawa is providing $5.2 billion in funding to help Newfoundland and Labrador avoid a spike in electricity rates resulting from the province s troubled Muskrat Falls hydroelectricity project.
Prime Minister Justin Trudeau announced the agreement alongside Premier Andrew Furey in St. John s today.
The money will help cover costs set to come due when the Labrador project begins generating power this November, preventing sweeping rate increases that would have been necessary to pay the bills.
Ottawa is giving the province $3.2 billion from its share in the Hibernia oilfield off the coast of St. John s, while the remaining $2 billion comes from loan guarantees and a $1-billion investment in the province s portion of the Labrador-Island Link.
Electricity rates in the province will rise when the project comes online, to 14.7 cents per kilowatt hour from the current 12.5 cents, but that s well below the projected 23 cents that officials had said would be needed to cover the project s costs.