Muskrat Falls key for future power needs: Kennedy

Natural Resources Minister Jerome Kennedy says Newfoundland and Labrador needs a new source of energy.

The provincial government released another Muskrat Falls report on Wednesday, this time on the province's future energy demands.

"Newfoundland and Labrador Hydro's planning load forecast indicates that by 2015 the province will be challenged to reliably meet peak demand in the winter months. And post-2019, we will simply not have enough energy to reliably meet demand throughout the year," Kennedy said.

The forecast pointed to annual growth of the island's electricity demand of 1.4 per cent between 2011 and 2013.

While industrial demand has gone down, residential demand has gone up by 16 per cent, and commercial demand is up 10 per cent.

And even though the province's population growth is expected to be relatively flat, there has been an increase of 18,600 new ratepayers since 2006, according to the forecast.

Kennedy said the increase in demand has come from a change in how people in the province live.

"We have more homes, we have less people in the homes, [and] we have bigger homes. We have younger families, and we have more electric space-heating," he said.

Gilbert Bennett, Nalcor Energy's vice-presidentfor the Lower Churchill project, said Newfoundland and Labrador Hydro wanted to be realistic with its numbers, and noted that Manitoba Hydro International called some of its figures too conservative.

"Hydro approached its load forecast cautiously, and considers its load forecast practices and resulting long-term demand and energy requirements for the island's future to be reasonable," Bennett said.

"Developing Muskrat Falls will change the energy future of Newfoundland and Labrador, and move us away from continued dependence on oil, and unstable and ultimately higher electricity rates for consumers."

Kennedy said the need for power in the province outweighs previous options like energy conservation measures.

"While conservation demand management can be, while in conjunction with the other steps that are being taken, an important tool ... it's not going to be as it was put forward in the past as a way to solve the energy deficit which we're going to face," he said.

"The economy is flying, things are going good, we need more power, we've got the resource to develop, it's going to save us money in the long run, it gets us off the long-term dependence on volatile fuel prices, and it creates jobs, it benefits the economy, and results in us having a revenue-generating asset that will run for 100 years. So it seems to me to be a good story."

Conservation reports needed

Meanwhile, NDP MHA George Murphy said he would like to see reports related to energy conservation.

"We haven't seen anything about any conservation programming or anything, so that could affect the need for Muskrat Falls," he said.

"We don't see anything that is aggressive here on the part of government when it comes to addressing the other 95 per cent of households [not currently involved in conservation]."

Liberal MHA Andrew Parsons said while he's glad information on Muskrat Falls is finally coming to light, he still has many questions about the project.

"One of them again is the conservation issue that's been raised," he said. "It doesn't seem like there's been any measures to take that into account."

He also questioned what the province is planning to do with all the power that the Muskrat Falls project would create.

"If the demand is here [in the province], and this deal is based on us giving a significant amount [of power] to Nova Scotia [and] shipping it out there to those surplus markets, that doesn't sound like that's even a factor here, so why are we still going that route?"