The cost of building the Muskrat Falls hydroelectric project in Labrador has risen by nearly $800 million for Nalcor Energy with the price tag now forecast at just under $7 billion, reports The Canadian Press.
“The Muskrat Falls project continues to be the right decision for long-term energy supply for Newfoundland and Labrador and will deliver significant long-term value to the people of the province,” Nalcor President Ed Martin said in a news release.
The Crown-owned company is blaming the increase on higher construction costs because of competition in the industry, and additional spending to improve the system’s reliability and operation.
The joint project with Nova Scotia utility Emera would bring power from Muskrat Falls to the island of Newfoundland and on to Nova Scotia through a complex system of overland transmission and subsea cables.Nalcor’s share of the project was $6.2 billion, but is now estimated at $6.99 billion.
The total cost estimate for the project now stands at about $8.5 billion, with Emera spending $1.5 billion on the subsea cable — known as the Maritime Link — that will be used to transmit electricity from the dam under construction in central Labrador.
Construction has already started on the 170-kilometre cable that links Cape Breton with southwestern Newfoundland.