'Not my idea,' Dwight Ball says as Emera takes majority equity stake in Muskrat Falls link
Newfoundland and Labrador Premier Dwight Ball is deflecting criticism that Halifax-based Emera Inc. currently has a majority equity stake in the transmission link that will take hydroelectric power from the Muskrat Falls megaproject in Labrador across the Strait of Belle Isle to Newfoundland.
"This was not my idea. This was not the idea of anyone on this particular side of the house," Ball told the legislature Thursday, as the Liberals shifted responsibility to the previous Tory government for a shift in ownership of what's called the Labrador-Island Link.
Ball acknowledged that Emera — the partner of Crown-owned Nalcor Energy in bringing Muskrat power to market — has taken on an equity stake of 59 per cent, high above the 29 per cent it originally had.
Critics warn that Nova Scotia company could get a greater return on its equity in the project, while customers will have to pay more for electricity once Muskrat energy comes online.
According to the original Muskrat deal reached in 2010, Nalcor owns the Muskrat Falls generating assets, Emera owns the so-called Maritime Link connecting Newfoundland and Nova Scotia, and the two share ownership of the Labrador-Island Link.
During questioning this week in the House of Assembly, Opposition politicians were sharply critical of Ball's explanation about how Emera's equity stake practically doubled.
Critics skeptical of premier's claims
NDP House Leader Lorraine Michael accused Ball of not informing the public promptly of a change that could have significant implications for customers of hydroelectric power.
"The terms of the disastrous Muskrat Falls deal require ratepayers to foot the bill for a guaranteed 8.8 per cent annual return on equity in the project," Michael said.
"With the doubling of Emera's equity share how much money annually will go out of the pockets of ratepayers in this province and into the pockets of the private Nova Scotia company Emera?"
Emera is not a private company but a publicly traded one.
Ball laid the blame at the feet of the people who launched Muskrat Falls, the budget of which has spiralled to latest overall estimates of $11.4 billion, including financing costs. The projected budget at the November 2010 announcement was $6.2 billion.
"The best thing that could have been done is not to be in the situation that we're into today. It's the increasing costs, the construction at the Muskrat Falls project that is leading to the doubling of electricity rates," Ball said.
Equity stake could change again: Ball
Opposition Leader Paul Davis has also questioned Ball over the government's handling of Muskrat Falls, particularly the revelation that the majority of the Labrador-Island Link now appears to be controlled by an outside company.
"I can assure you that this is not going to provide me or anybody in the public with any type of confidence that the premier knows what he's talking about here," said Davis.
Ball has said the current equity stake for Emera in the link is not final.
"When you look at the Muskrat Falls project, [it] is always evolving as price changes," said Ball.
"As that all changes, it can mean that the various equity positions in the Labrador-Island link could actually change."
