Manitoba Hydro Endorses Nalcor’s Production Estimate for Muskrat Falls

In a report issued earlier today, Manitoba Hydro International (MHI) reviewed Nalcor’s proposal to build the Muskrat Falls generating station in Labrador and transmit the power to the island of Newfoundland and Nova Scotia. A key element of MHI report reviewed Nalcor’s energy production estimate for the project. MHI endorse Nalcor’s estimated output from  Muskrat Falls of 4.9 TWh/yr and 4.5 TWh/yr of “firm” energy.

The aspects of MHI’s report addressing the question of energy production to expect from Muskrat falls can be found at page 6 of the Executive Summary, Section 1.3.2 (particularly Table 7), and Section 2.2.9.

MHI did no original research on the question of how much usable power Muskrat Falls could produce in the transmission configuration proposed for the project. Rather, MHI relied upon the same documents that Nalcor has relied upon. With the exception of one document, all of the references relied upon by MHI were addressed in my posts “Stop Muskrat Falls” and “Adams Replies to Nalcor’s Demand for an Apology“.

One of the references MHI relied upon is Exhibit CE-21 from Hatch called “Estimate the Firm Generation Potential of the Muskrat Falls Development – Final Report for Nalcor Energy”, June 2011. This document is not available on the NL PUB’s site here, and appears to be secret. This gap in the publicly available record makes it possible that the analysis I have been relying on to critique Nalcor’s production claim of 4.9 TWh/yr contains some important gap.

Here are the reasons why I continue to stand by my assessment that the output of Muskrat Falls has been vastly overstated by Nalcor and MHI, probably by about 50%, and that Nova Scotia will be unable to get any significant amounts of hydro-electric generation from Newfoundland during cold winter weather.

  • The approach used in the MHI report to assess how much energy Muskrat Falls will provide follows some of the key steps that I have used. I believe that MHI repeated the mistake that Nalcor has persistently made of not considering the production implications of the change in the transmission configuration in applying the results of the 1998 Acres study to the new Muskrat Falls project.
  • The final position of MHI regarding the output of Muskrat Falls — 4.9 TWh/yr — aligns with claims that Nalcor made about this project in its 2007 EIS document and Nalcor’s 2001 main case filing, thereby indicating that the secret 2011 Hatch study does not change the debate.
  • MHI acknowledges at sections 3.4.2 and 3.4.3 that Nalcor has not yet performed an AC system integration study. Properly done, this study would reply to my assertion that the likely output of Muskrat Falls is approximately half what MHI and Nalcor now claim.

Following the lead of Nalcor, MHI does not address the fact that the production estimates for Muskrat Falls provided in the 1998 Acres study are approximately 10% below the estimates of 4.9 TWh/yr of average energy and 4.5 TWh/yr of firm energy. In the Acres study (Exhibit CE-28), the average energy reported for Muskrat Falls is 4.4 TWh/yr and the firm energy is 4.1 TWh/yr as seen in Table S1 of that document.

Also following the lead of Nalcor, MHI reports that there is potential for uprating the generation capacity of Muskrat Falls. The inclusion of this statement suggests that MHI has failed to consider the lack of value to the integrated system of even more generation capacity in May and June when the combination of loads within the province plus the interconnection capacity to Nova Scotia is already far less than the available hydro-electric generation.



  1. So here we go again, another study done by a different agency with the same information getting the same results. With of course a few variables. It’s amazing how many time the old saw of Freud’s statement of insanity being about; “Doing the same thing over and over and expecting diferent results”. How long will this Administrationk keep doing this? Of course until nobody is no longert paying any attention, then they will announce the sart of the Project.

  2. Manitoba Hydro don’t have the best record at getting things right-witness the cost overruns on their Head Office building here;
    Remember what the Public Utilities Board said about the downtown Manitoba Hydro building?:
    “9.7 New Head Office
    As a condition of the purchase agreement entered into when WH was acquired, MH agreed to build a new Corporate head office in downtown Winnipeg. The building was originally forecast in CEF 03-1 at a cost estimate of $75 million, the amount then cited as a ‘place marker’ subject to design changes and cost revisions.
    The new building is to accommodate approximately 2,100 employees and to be ready for occupation by 2009, and come at a projected revised cost of $278 million.”

    That’s a whopping 370 percent over the initial cost estimate.

    This same site takes an interesting run at Manitoba Hydro with their deal to store excess wind generation from Minnesota here:

    • Governments everywhere love megaprojects. They can spend a lot of borrowed money, boost the economy in the short run, get their smiling picture taken at the ribbon cutting, and pass the costs to future generations. This project is a government project much more than it is a utility project. Nalcor is just doing what they are told to do.

  3. Actually Nalcor is doing what this province needs. We are spending too much on oil fired generation and that is only going to go up. The cost to the province is NOT $6.2B as Emera will be putting in around $2B. The water management deal WILL allow Muskrat Falls to store energy in the short term for later use and not waste water. The energy that will go to Emera is energy this province would be unable to use in the near term and would go to waste (spill) (we can’t store it for 35years) if not sold, and it is not being given away, as I think Emera would agree, at $2B. The ONLY argument is do you trust the people at Nalcor or not. I do, and I have not seen any legitimate argument not to. People keep spouting that they have not examined all the options or they are not using the right numbers or some other twist on reality. Do you really think that they are that stupid? I don’t expect they have examined the option beaming a request for power into space in hopes that ET will have extra but I am sure some of you out there would argue they should have. The men and women working at Nalcor are good, honest, smart people that are doing their best to supply least cost reliable power to the people of Newfoundland and Labrador as is their mandate. They have more combined experience and intelligence than most of you can imagine. I wish more people weren’t so cynical and could trust their fellow Newfoundland and Labradorians. It is a sad world we live in!

    • Ted,
      Why would anyone trust a company that brings forward a hydro-election development plan without an integration study? Why would anyone trust a company with a business plan based on using somebody else’s asset?

  4. The more I learn about this project the worse it seems. The proponents are using ad hominem attacks and vague, unproven arguments. The fast pace, narrow focus and secrecy of the review process make me suspicious. This project is controversial and needs more scrutiny. Rather than welcoming the unbiased, skillful input of experts from outside NL, those in favour are as hostile and zealous as “magic bullet” theory defenders.

    My simple math tells me that this expenditure might well be more onerous on NL than the nuclear reactor at Pt. Lepreau is on NB, not an easy feat. And to those telling the rest of Canada to mind our business, the federal loan guarantees (and revenue and cost sharing formula among provinces) makes it the business of all Canadians.

  5. For the sake of argument…I like Rod Brake’s question.
    NL deserves to be angry over the Churchill Falls deal, and the animosity has probably tainted the relationship to the point where getting the rich hydro resources to market (beyond Gull Island and Muskrat Falls, I understand there’s another 1000MW that could be engineered upriver – so 4000MW of untapped potential). NF thinks, and most people would also think, the generating resource is the asset, and Quebec thinks the land between the generating asset and potential markets is the valuable asset (unless that land is New Hampshire or Vermont).
    On megaprojects … I read an interview with Amory Lovins in which he referenced FDR as the source for a quirky principle: “if a problem doesn’t have a solution, enlarge the problem” – I don’t think megaprojects are uniquely government legacy projects.
    I’d suggest that expanding the problem be looked at on the transmission side here … at least the cabling in the ocean should have the ability to carry 3000MW.
    The economics for the project could have more to do with NF’s ability to tax power exports, which I understand changes in the agreements with Quebec as of 2016. That’s pertinent to agreements with Nova Scotia too. I’d suggest a $30/MWh export tax could raise about $1 billion a year, on existing CF production. The ability to move much of CF’s production to a market via another route has a value far greater than the MF project does.
    I’m just throwing some figures about – but I think the project makes the most sense as a proposal strengthening negotiations with Quebec … and I don’t think the current project is either sane enough to make Quebec reconsider its position, nor bold enough to make them edgy.

  6. Tom,
    I think that an integration study is needed, maybe not before now maybe so but there is still time. This like any large project is being done in stages and there is a higher level of information and detail needed at each stage. The reason to trust them lies not in the fact that there is no integration study yet but in the fact that they are looking to others to point out what they have missed or gotten wrong. I don’t think they are infallible or that we should give blind trust to them, or anyone, but the thing that gets me is that some people seem to want to claim everything that is coming out of Nalcor must be a lie because the government is in favour of this.
    These things sound good on the surface and are fundamentally right. The problem is how far people want to go with it. There is no way for someone to come in start from scratch and develop a complete new engineering study from the ground up for the Lower Churchill it is simply too long and too expensive to consider. So if Nalcor has already done the ground work and evaluated the numbers to come to a conclusion then perhaps having an independent review of how they obtained the numbers, how they evaluated the numbers and the conclusions they drew from the numbers should give sufficient grounds to believe the numbers when the independent review agrees. Expecting an independent reviewer to come in and not use any information from Nalcor is ridiculous. Examining every conceivable alternative in full detail is just as ridiculous. There is no need to spend time and money examining nuclear options as provincial regulation prohibit them. Others are clearly not as viable as the main ones after a less intense examination than is given to the final contenders. Just because the final study does not go into great detail about every possible option does not mean they were not given appropriate consideration. What I mean is trust the people are doing their best and trying to find the best alternative not just pushing one option because they ‘like’ it. Question them sure but don’t make them out to be idiots and liars because they are not.

    As for “somebody else’s asset” I can only think you mean the Upper Churchill reservoir. Does this mean you finally understand that it can be used to control water and energy availability at Muskrat Falls? I hope so. But it is not somebody else’s. It belongs to this province through Churchill Falls (Labrador) Corporation Limited which is part of Nalcor. I know HQ gets to direct the production of energy from the water in the reservoir but it is not their’s. And any water stored there under the water management agreement is not under their direction. If this is not the asset you refer to then my apologies and please clarify.

    • Ted,
      The Upper Churchill reservoir can physically take water from Muskrat. The problem I see is not physical but contractual. I see no basis to believe that Churchill Falls can deliver winter energy to NL beyond the recall. After NL has lost twice in the Supreme Court trying to thwart the ’69 contract, I can’t understand why you think the WMA has any significance for Muskrat Falls. What am I missing?

  7. Tom,

    I don’t think you’re missing anything. The flow coming from CF is limited, as described in pages 5-4 and 5-5 of the Muskrat EIS which you quoted in an earlier post. The 1,400 m³/s flow is the mean flow and the maximum flow would be around 1,864 m³/s if:

    P = hrgk, where P=5428 MW, h=312.4 m, g=9.81 m/s² and k=95%.

    Sure, Muskrat will get the benefit of a 22,000 km² intermediate drainage area downstream from the falls, but the flow is variable (quite low in winter and much higher during the spring freshet). So, unless CFLCo voluntarily spills water in January to increase the flow of the Churchill River downstream (unlikely if my understanding of section 4.2.1 of the 1969 contract is accurate), Muskrat Falls will be under water limitations and won’t operate at the nominal 2,600 m³/s capacity except in the spring shoulder months. In other words, I don’t expect the RoR Muskrat Falls GS to generate much more than 500-550 MW figure you stated in your earlier post.

  8. I agree with a lot of what you are saying guys. During times that the CF plant is running at capacity during the winter there will be no additional capacity available to Nalcor and Muskrat Falls will likely be unable to run at full capacity due to insufficient natural inflows to supplement the discharge from CF. But, there will usually be periods of time that HQ will not require CF at maximum output if even by 50 or 100 MW. If Muskrat Falls can output 500-550 MW during these times then it would only need about 5.5% of CF capacity or ~300 MW to reach maximum output. Even 50 or 100 MW, 1-2 % of capacity, would be a substantial contribution to MF output. If CF production were reduced significantly and as such reduce water to MF then there would also be plenty of capacity at CF to make up the lost production at MF. Clearly if there is an anticipated 4.9 TWh of energy expected from Muskrat Falls then it is not expected to operate at 100% capability factor but more like 68% average capability factor. That is approximately 560 MW continuous average output, not far from the 500-550 MW you mention.

    The water management agreement has almost no bearing on the existing agreements between CF and HQ except that it specifies that it cannot interfere with power delivery under those agreements. During times of peak water there is nothing in the existing agreements that says part of the energy requirements cannot come from MF thereby storing energy (water) in the CF reservoir. There is also nothing that prevents any excess capacity not immediately required to meet energy delivery under the existing agreements from being used to return that stored energy to MF, but it does have to be stored there first. There will be times when there no, or very little, available capacity to return energy but a lot of the time there will be some. None of this will use the water or energy that would naturally be available in CF for meeting existing agreements only the water that was held back due to production at MF.
    Normally: there is x amount of energy in the reservoir, there is production request that would use p energy produced at CF, the remaining energy r for existing agreements is, r=x-p.
    Now: there is x amount of energy in the reservoir, there is production request that would use p energy, m energy is produced at Muskrat Falls and delivered under existing agreements while p-m is now produced at CF, the remaining energy r for existing agreements is still r=x-p but the actual energy in the reservoir is r+m. There is no change in r but there is a change in total reservoir storage. This is reversed to get it back, production at CF is p+m thus reducing the storage at CF by m without changing r.
    It is the combination of the size difference between Churchill Falls and Muskrat Falls and the fact that CF doesn’t always run at 100% output that will allow energy flow from CF to MF. It is the WMA that will allow the energy to flow first from MF to CF and later back without interfering with the existing agreements.

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