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Muskrat Falls financial impact highlights a hydro megaproject's cost overruns, rate mitigation challenges, and inquiry findings in Newfoundland and Labrador, with power exports, Churchill River generation, and subsea cables shaping long-term viability.

Key Points

It refers to the project's burden on provincial finances, driven by cost overruns, rate hikes, and debt risks.

✅ Costs rose to $12.7B from $6.2B; inquiry cites suppressed risks.

✅ Rate mitigation needed to offset power bill shocks.

✅ Exports via subsea cables may improve long-term viability.

Newfoundland and Labrador's premier says the Muskrat Falls hydro megaproject is currently too much of a massive financial burden for him to be optimistic about its long-term potential.

"I am probably one of the most optimistic people in this room," Liberal Premier Dwight Ball told the inquiry into the project's runaway cost and scheduling issues, echoing challenges at Manitoba Hydro that have raised similar concerns.

"I believe the future is optimistic for Newfoundland Labrador, of course I do. But I'm not going to sit here today and say we have an optimistic future because of the Muskrat Falls project."

Ball, who was re-elected on May 16, has been critical of the project since he was opposition leader around the time it was sanctioned by the former Tory government.

He said Friday that despite his criticism of the Labrador dam, which has seen costs essentially double to more than $12.7 billion, he didn't set out to celebrate a failed project.

He said he still wants to see Muskrat Falls succeed someday through power sales outside the province, but there are immediate challenges -- including mitigating power-rate hikes once the dam starts providing full power and addressing winter reliability risks for households.

"We were told the project would be $6.2 billion, we're at $12.7 (billion). We were never told this project would be nearly 30 per cent of the net debt of this province just six, seven years later," the premier said.

"I wanted this to be successful, and in the long term I still want it to be successful. But we have to deal with the next 10 years."

The nearly complete dam will harness Labrador's lower Churchill River to provide electricity to the province as well as Nova Scotia and potentially beyond through subsea cables, while the legacy of Churchill Falls continues to shape regional power arrangements.

Ball's testimony wraps up a crucial phase of hearings in the extensive public inquiry.

The inquiry has heard from dozens of witnesses, with current and former politicians, bureaucrats, executives and consultants, amid debates over Quebec's electricity ambitions in the region, shedding long-demanded light on what went on behind closed doors that made the project go sideways.

Some witnesses have suggested that estimates were intentionally suppressed, and many high-ranking officials, including former premiers, have denied seeing key information about risk.

On Thursday, Ball testified to his shock when he began to understand the true financial state of the project after he was elected premier in 2015.

On Friday, Ball said he has more faith in future of the offshore oil and gas industry, and emerging options like small nuclear reactors, for example, than a mismanaged project that has put immense pressure on residents already struggling to make ends meet.

After his testimony, Ball said he takes some responsibility for a missed opportunity to mitigate methylmercury risks downstream from the dam through capping the reservoir, in parallel with debates over biomass power in electricity generation, something he had committed to doing before it is fully flooded this summer.

Still to come is a third phase of hearings on future best practices for issues like managing large-scale projects and independent electricity planning, two public feedback sessions and closing submissions from lawyers.

The final report from the inquiry is due before Dec. 31.

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UK Energy Price Guarantee Cost forecasts from Cornwall Insight suggest an £89bn bill, tied to wholesale gas prices, OBR projections, and fiscal policy, to shield households amid the cost of living crisis.

Key Points

It is the projected government spend to cap household bills, driven by wholesale gas prices and OBR market forecasts.

✅ Base case: £89bn over two years, per Cornwall Insight

✅ Range: £72bn to £140bn, volatile wholesale gas costs

✅ Excludes 6-month business support estimated at £22bn-£48bn

Liz Truss’s intervention to freeze energy prices for households for two years is expected to cost the government £89bn, according to the first major costing of the policy by the sector’s leading consultancy.

The analysis from Cornwall Insight, seen exclusively by the Guardian, shows the prime minister’s plan to tackle the cost of living crisis could cost as much as £140bn in a worst-case scenario.

Truss announced in early September that the average annual bill for a typical household would be capped at £2,500 to protect consumers from the intensifying cost of living crisis amid high winter energy costs and a scheduled 80% rise in the cap to £3,549.

The ultimate cost of the policy is uncertain as it is highly dependent on the wholesale cost of gas, including UK natural gas prices which have soared since Russia’s invasion of Ukraine put a squeeze on already-volatile international markets. Ballpark projections had put the cost anywhere from £100bn to £150bn.

The Office for Budget Responsibility is expected to give its forecast for the bill when it provides its independent assessment of Kwasi Kwarteng’s medium-term fiscal plan, which the chancellor said on Tuesday would still happen on 23 November despite previous reports that it would be brought forward.

Cornwall Insight analysed projections of wholesale market moves to cost the intervention. In its base case scenario, analysts expect the policy to cost £89bn. That assumes the cost of supporting each household would be just over £1,000 in the first year, and about £2,000 in the second year.

The study’s authors said the wholesale price of gas would be influenced by energy demand, the severity of weather, “geo-political uncertainty” and prices for liquified natural gas as Europe seeks to refill storage facilities, which countries have rushed to fill up this winter but which could be relatively empty by next spring.

In the best-case outcome, the policy would cost £72bn, with some projections pointing to a 16% decrease in energy bills in April for households, while the “extreme high” outlook would see the government shell out £140bn to protect 29m UK households.

Gas prices are expected to push even higher if the Kremlin decides to completely cut off Russian gas exports into Europe.

Cornwall Insight’s projection does not include a separate six-month initiative to cap costs for companies, charities and public sector organisations, which is forecast to cost £22bn to £48bn.

The consultancy’s chief executive, Gareth Miller, said the £70bn range in its forecasts reflected “a febrile wholesale market continuing to be beset by geopolitical instability, sensitivity to demand, weather and infrastructure resilience”.

He said: “Fortune befriends the bold, but it also favours the prepared. The large uncertainties around commodity markets over the next two years means that the government could get lucky with costs coming out at the low end of the range, but the opposite could also be true.

“In each case, the government may find itself passengers to circumstances outside its control, having made policy that is a hostage to surprises, events and volatile factors. That’s a difficult position to be in.”

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The government has faced criticism, as some British MPs urge tighter limits on prices, that the policy is effectively a “blank cheque” and is not targeted at the most vulnerable in society.

Concerns over how Truss and Kwarteng intend to fund a series of measures, including the price guarantee, have spooked financial markets.

The EU, which has outlined possible gas price cap strategies in recent proposals, said last week it planned to cap the revenues of low-carbon electricity generators at €180 a megawatt hour, which is less than half current market prices. Truss has so far resisted calls to extend a levy on North Sea oil and gas operators to electricity generators, who have benefited from a link between gas and electricity prices in Britain.

Truss hopes to strike voluntary long-term deals with generators including Centrica and EDF, alongside the government’s Energy Security Bill measures, to bring down wholesale prices.

The Financial Times reported on Tuesday that the government has threatened companies with legislation to cap their revenues if voluntary deals cannot be agreed.

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Ireland 65% Renewable Grid Capability showcases world leading integration of intermittent wind and solar, smart grid flexibility, EU-SysFlex learnings, and the Celtic Interconnector to enhance stability, exports, and energy security across the European grid.

Key Points

Ireland can run its isolated power system with 65% variable wind and solar, informing EU grid integration and scaling.

✅ 65% system non-synchronous penetration on an isolated grid

✅ EU-SysFlex roadmap supports large-scale renewables integration

✅ Celtic Interconnector adds 700MW capacity and stability

Ireland is now able to cope with 65% of its electricity coming from intermittent electricity sources like wind and solar, as highlighted by Ireland's green electricity outlook today – an expertise Energy Minister Denish Naugthen believes can be replicated on a larger scale as Europe moves towards 50% renewable power by 2030.

Denis Naughten is an Irish politician who serves as Minister for Communications, Climate Action and Environment since May 2016.

Naughten spoke to editor Frédéric Simon on the sidelines of a EURACTIV event in the European  Parliament to mark the launch of EU-SysFlex, an EU-funded project, which aims to create a long-term roadmap for the large-scale integration of renewable energy on electricity grids.

What is the reason for your presence in Brussels today and the main message that you came to deliver?

The reason that I’m here today is that we’re going to share the knowledge what we have developed in Ireland, right across Europe. We are now the global leaders in taking variable renewable electricity like wind and solar onto our grid.

We can take a 65% loading on to the grid today – there is no other isolated grid in the world that can do that. We’re going to get up to 75% by 2020. This is a huge technical challenge for any electricity grid and it’s going to be a problem that is going to grow and grow across Europe, even as Europe's electricity demand rises in the coming years, as we move to 50% renewables onto our grid by 2030.

And our knowledge and understanding can be used to help solve the problems right across Europe. And the sharing of technology can mean that we can make our own grid in Ireland far more robust.

What is the contribution of Ireland when it comes to the debate which is currently taking place in Europe about raising the ambition on renewable energy and make the grid fit for that? What are the main milestones that you see looking ahead for Europe and Ireland?

It is a challenge for Europe to do this, but we’ve done it Ireland. We have been able to take a 65% loading of wind power on our grid, with Irish wind generation hitting records recently, so we can replicate that across Europe.

Yes it is about a much larger scale and yes, we need to work collaboratively together, reflecting common goals for electricity networks worldwide – not just in dealing with the technical solutions that we have in Ireland at the fore of this technology, but also replicating them on a larger scale across Europe.

And I believe we can do that, I believe we can use the learnings that we have developed in Ireland and amplify those to deal with far bigger challenges that we have on the European electricity grid.

Trialogue talks have started at European level about the reform of the electricity market. There is talk about decentralised energy generation coming from small-scale producers. Do you see support from all the member states in doing that? And how do you see the challenges ahead on a political level to get everyone on board on such a vision?

I don’t believe there is a political problem here in relation to this. I think there is unanimity across Europe that we need to support consumers in producing electricity for self-consumption and to be able to either store or put that back into the grid.

The issues here are more technical in nature. And how you support a grid to do that. And who actually pays for that. Ireland is very much a microcosm of the pan-European grid and how we can deal with those challenges.

What we’re doing at the moment in Ireland is looking at a pilot scheme to support consumers to generate their own electricity to meet their own needs and to be able to store that on site.

I think in the years to come a lot of that will be actually done with more battery storage in the form of electric vehicles and people would be able to transport that energy from one location to another as and when it’s needed. In the short term, we’re looking at some novel solutions to support consumers producing their own electricity and meeting their own needs.

So I think this is complex from a technical point of view at the moment, I don’t think there is an unwillingness from a political perspective to do it, and I think working with this particular initiative and other initiatives across Europe, we can crack those technical challenges.

To conclude, last year, the European Commission allocated €4 million to a project to link up the Irish electricity grid to France. How is that going to benefit Ireland? And is that related to worries that you may have over Brexit?

The plan, which is called the Celtic Interconnector, is to link France with the Irish electricity grid. It’s going to have a capacity of about 700MW. It allows us to provide additional stability on our grid and enables us to take more renewables onto the grid. It also allows us to export renewable electricity onto the main European grid as well, and provide stability to the French network.

So it’s a benefit to both individual networks as well as allowing far more renewables onto the grid. We’ve been working quite closely with RTE in France and with both regulators. We’re hoping to get the support of the European Commission to move it now from the design stage onto the construction stage. And I understand discussions are ongoing with the Commission at present with regard to that.

And that is going to diversify potential sources of electricity coming in for Ireland in a situation which is pretty uncertain because of Brexit, correct?

Well, I don’t think there is uncertainty because of Brexit in that we have agreements with the United Kingdom, we’re still going to be part of the broader energy family in relation to back-and-forth supply across the Irish Sea, with grid reinforcements in Scotland underscoring reliability needs.  But I think it is important in terms of meeting the 15% interconnectivity that the EU has set in relation to electricity.

And also in relation of providing us with an alternative support in relation to electricity supply outside of Britain. Because Britain is now leaving the European Union and I think this is important from a political point of view, and from a broader energy security point of view. But we don’t see it in the short term as causing threats in relation to security of supply.

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Clean Energy Standard charts a federal path to decarbonize the power sector, scaling renewables, wind, solar, nuclear, and carbon capture to slash emissions, create green jobs, and reach net-zero targets amid the climate crisis.

Key Points

A federal policy to expand clean power and cut emissions with renewables, nuclear, and carbon capture toward net-zero.

✅ Mandates annual increases in clean electricity supply

✅ Includes renewables, nuclear, hydro, and carbon capture

✅ Targets rapid emissions cuts and net-zero by mid-century

The world has been put on notice. Last year, both the UN Intergovernmental Panel on Climate Change and the U.S. National Climate Assessment warned that we need to slash greenhouse gas emissions to avoid disastrous impacts of global warming. Their direct language forecasting devastating effects on our health, economics, environment, and ways of life has made even more urgent the responsibility we all have to act boldly to combat the climate crisis.

This week, we’re adding one important tool for addressing the climate crisis to the national conversation.

Together, we’re taking that bold action. The Climate reports made clear that to limit the global temperature rise and stave off devastating impacts to our climate—human-caused CO2 emissions must fall rapidly by 2030 and that we, as a global community, underscored at the Katowice climate talks, must reach net-zero emissions by the middle of the century. The Clean Energy Standard is federal legislation that offers a pathway toward decarbonizing our power sector and helping our nation accomplish a goal of net-zero emissions by the 2050s.

Under this plan, any company selling retail electricity will have a mandate to increase the amount of clean energy provided to its customers. It will incentivize clean electricity investment to put the U.S. on a sustainable path.

To deal most effectively with a crisis, all tools must be on the table. Our plan focuses solely on emissions, and there is a place for all technologies that can put us on the path to net zero. That will mean drastic increases in wind and solar energy for sure, as states like California pursue a 100% carbon-free electricity mandate to accelerate deployment, but nuclear power, hydro power, and fossil fuels with carbon capture and storage all have important roles to play.

We’re doing this because the science is clear – tackling our climate crisis requires serious and rapid action to control greenhouse gas emissions, and the push for decarbonization is irreversible according to many. Inaction on the climate crisis puts our families at risk, and we’re not wasting any time. This is also an opportunity to create good-paying green jobs that can last generations and uplift the middle class.

We are doing this for the environment, but also for jobs and economic competitiveness. The green economy is the future and we’re ready to see it grow, with states like New York advancing a Green New Deal that drives innovation. The United States can lead, or we can follow, and we want our nation to lead.

And, because as a New Mexican and a Minnesotan, we know that the impacts of climate change go far beyond the headlines and political discourse. It means devastation within tamarack forests and an increase in deadly fires. It means hotter summers and shorter winters with extreme temperature swings throughout the year. It means devastating flash floods with increasingly intense rain. It’s impacting our pocketbooks when farmers and small businesses who work the land in rural communities are unable to make ends meet.

States across the country are already acting to combat the climate crisis – including Minnesota's 2050 carbon-free electricity plan and New Mexico. But in order to truly address climate change, we have to be in this together as Americans. If the problem is far-reaching, our solutions must be equally as holistic.

It's why we've worked with green groups and activists, unions, and communities across the country - from urban to rural - to create a solution that understands the different starting points communities face in reaching net zero emissions, but doesn't shrink from the absolute need to reach that standard.

There is not one solution to climate change – it will take a collective group of individuals prepared to boldly act. And we are ready to take on that fight.

In Congress, we have formed the House Select Committee on the Climate Crisis and the Senate Democrats’ Special Committee on the Climate Crisis to hear from everyday Americans how climate change is affecting them – and how we can come together to find solutions that build on the historic climate deal passed this year. We have heard the stories of young people worried about their futures. And we realize there is a sense of urgency to act.

Over the coming weeks and months, we will be building support from communities across the country to make this plan a reality. We will continue working with stakeholders to ensure every voice is heard. Most importantly, we will continue listening to you and your communities.

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Ontario Electricity Billing Changes include OEB-backed shifts to time-of-use or tiered pricing, landlord blanket elections, LDC implementation guidance, a customer choice webpage with a bill calculator, and ENDM rate mitigation messaging.

Key Points

They are OEB measures enabling TOU-to-tiered switching, landlord elections, LDC guidance, and ENDM bill messages.

✅ Option to switch from TOU to tiered pricing

✅ Landlord blanket elections on tenant turnover

✅ ENDM-led bill info and rate mitigation messaging

By David Stevens, Aird & Berlis LLP

Electricity consumers in Ontario may see a couple of electricity rate changes in their bills in the coming months.

First, as we have already discussed, as of November 1, 2020, regulated price plan customers will have the option to switch to "tiered pricing" instead of time-of-use (TOU) pricing structures. Those who switch to "tiered pricing" will see changes in their electricity bills.

The Ontario Energy Board (OEB) has now issued final amendments to the Standard Supply Service Code to support the customer election process necessary to switch from TOU pricing to tiered pricing. The main change from what was already published in previous OEB notices is that landlords will be permitted to make a "blanket election" between TOU pricing and tiered pricing that will apply each time a tenant's account reverts back to the landlord on turnover of the rental unit. In its most recent notice, the OEB acknowledges that implementing the new customer billing option as of Nov. 1 (less than two months from now) will be challenging and directs Local Distribution Companies (LDCs) who cannot meet this date to be immediately in touch with the OEB. Finally, the OEB indicates that there will be a dedicated "customer choice webpage for consumers, including a bill calculator" in place by early October.

Second, as of January 1, 2021 low-volume consumers will see additional messaging on their bills to inform them of available rate mitigation programs.

A recent proposal posted on Ontario's Regulatory Registry indicates that the Ministry of Energy, Northern Development and Mines (ENDM) proposes that LDCs and Utility Sub-Meter Providers will be required to include a new on-bill message for low-volume consumers that "will direct customers to ENDM's new web page for further information about how the province provides financial support to electricity consumers." This new requirement is planned to be in place as of January 1, 2021. In conjunction with this requirement, the ENDM plans to launch a new web page that will provide "up-to-date information about electricity bills," including information about rate mitigation programs available to consumers. Parties are invited to submit comments on the ENDM proposal by October 5, 2020.

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Hydro-Québec Northeast Clean Energy Transmission delivers surplus hydropower via HVDC interconnections to New York and New England, leveraging long-term contracts and projects like CHPE and NECEC to support carbon-free goals, GHG cuts, and grid reliability.

Key Points

An initiative to expand HVDC links for Quebec hydropower exports, aiding New York and New England decarbonization.

✅ 37,000 MW hydro capacity enables firm, low-carbon exports

✅ Targets NY and NE via CHPE, NECEC, and upgraded interfaces

✅ Backed by long-term PPAs to reduce merchant transmission risk

With roughly 37,000 MW of installed hydro power capacity, Quebec has ample spare capacity that it would like to deliver into Northeastern US markets where ambitious clean energy goals have been announced, but expanding transmission infrastructure is challenging.

Register Now New York recently announced a goal of receiving 100% carbon-free energy by 2040 and the New England states all have ambitious greenhouse gas reduction goals, including a Massachusetts law requiring GHG emissions be 80% below 1990 levels by 2050.

The province-owned company, Hydro Quebec, supplies power to the provinces of Quebec, Ontario and New Brunswick in particular, as well as sending electricity directly into New York and New England. The power transmission interconnections between New York and New England have reached capacity and in order to increase export volumes into the US, "we need to build more transmission infrastructure," Gary Sutherland, relationship manager in business development, recently said during a presentation to reporters in Montreal.

TRANSMISSION OPTIONS

Hydro Quebec is working with US transmission developers, electric distribution companies, independent system operators and state government agencies to expand that transmission capacity in order to delivery more power from its hydro system to the US, as the province has closed the door on nuclear power and continues to prioritize hydropower, Sutherland said.

The company is looking to sign long-term power supply contracts that could help alleviate some of the investment risk associated with these large infrastructure projects.

"It`s interesting to recall that in the 1980s, two decade-long contracts paved the way for construction of Phase II of the multi-terminal direct-current system (MTDCS), a cross-border line that delivers up to 2,000 MW from northern Quebec to New England," Hydro Quebec spokeswoman Lynn St-Laurent said in an email.

Long-term prices have been persistently low since 2012, following the shale gas boom and the economic decline in 2008-2009, St-Laurent said. "As such, investment risks are too high for merchant transmission projects," she said.

Northeast power market fundamentals "remain strong for long-term contracts," on transmission projects or equipment upgrades that can deliver clean power from Quebec and "help our neighbors reach their ambitious clean energy goals," St-Laurent said.

NEW ENGLAND

In March 2017 an HQ proposal was selected by Massachusetts regulators to supply 9.45 TWh of firm energy to be delivered for 20 years. HQ`s proposal consisted of hydro power supply and possible transmission scenarios developed in conjunction with US partners.

The two leading options include a route through New Hampshire called Northern Pass and New England Clean Energy Connect through Maine.

The New Hampshire Site Evaluation Committee in March 2018 voted unanimously to deny approval of the $1.6 billion Northern Pass Transmission project, which is a joint venture between HQ and Eversource Energy`s transmission business. Eversource has been fighting the decision, with the New Hampshire Supreme Court accepting the company`s appeal of the NHSEC decision in October.

Briefs are being filed and oral arguments are likely to begin late spring or early summer, spokesman William Hinkle said in an email Tuesday.

After the Northern Pass permitting delay, Massachusetts chose the New England Clean Energy Connect project, which is a projected 1,200 MW transmission line, with 1,090 MW contracted to Massachusetts, leaving 110 MW for use on a merchant basis, according to St-Laurent.

NECEC is a joint venture between HQ and Central Maine Power, which is a subsidiary of Avangrid, a company affiliated with Spain`s Iberdrola. The NECEC project has received opposition from some environmental groups and still needs several state and federal permits.

NEW YORK

"The 5% of New York`s load that we furnish year in and year out ... is mostly going into the north of the state, it`s not coming down here," Sutherland said during a discussion at Pace University in New York City in 2017.

One potential project moving through the permitting phase, is the $2.2 billion, 1,000-MW Champlain Hudson Power Express transmission line being pursued by Transmission Developers -- a Blackstone portfolio company -- that would transport power from Quebec to Queens, New York.

Under New York`s proposed Climate Leadership Act which calls for the 100% carbon-free energy goal, renewable generation eligibility would be determined by the Public Service Commission. The PSC did not respond to a question about whether hydro power from Quebec is being considered as a potential option for meeting the state`s clean energy goal.

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