Lower Churchill Project

The Lower Churchill Project is a planned hydroelectric project in Labrador, Canada, to develop the remaining 35 per cent of the Churchill River that has not already been developed by the Churchill Falls Generating Station. The Lower Churchill's two installations at Gull Island and Muskrat Falls will have a combined capacity of over 3,074 MW and have the ability to provide 16.7 TWh of electricity per year.[1]

Phase 1

Muskrat Falls Generation Facility

Muskrat Falls Generation Facility
Location Canada
Newfoundland and Labrador
Coordinates 53°14′44.3″N 60°46′22″W / 53.245639°N 60.77278°W / 53.245639; -60.77278Coordinates: 53°14′44.3″N 60°46′22″W / 53.245639°N 60.77278°W / 53.245639; -60.77278
Construction began 2013 [2]
Opening date Expected 2019 [3]
Construction cost C$3.69 billion [4]
Owner(s) Nalcor Energy
Dam and spillways
Type of dam Roller compacted concrete
Impounds Churchill River
Elevation at crest 39.5 m [5]:21
Spillways 2
Spillway type 1 overflow spillway and 1 spillway with submerged radial gates [6]:87–88
Spillway capacity 5930 m3/s [5]:21
Reservoir
Normal elevation 39 m [5]:20
Power station
Turbines 4 x 206 MW Kaplan turbines [5]:23
Installed capacity 824 MW [6]:86
Annual generation 4.5 TWh/yr [6]:86

The Muskrat Falls Generation Facility will consist of a dam, a spillway, and a powerhouse with four Kaplan turbines and a total generating capacity of 824 MW. The concrete dam will be built in two sections (on the north and south abutments of the river): the north dam will be 32 m high and 432 m long, the south dam 29 m high and 325 m long. The reservoir will be 59 km long with an area of 101 km2. The area of inundated land will be 41 km2 at full supply level.[5] Four 315 kV AC transmission lines will connect the powerhouse to the Muskrat Falls switchyard.

Construction of the Muskrat Falls Generation Facility began in 2013 and was expected to take four to five years.[2] As of 2016 first power from the dam and hydro station is expected to be delayed until December, 2019.[3]

Emera and Nalcor will form a joint venture to construct transmission facilities from Labrador to Newfoundland at a cost of $2.1 billion.

The Labrador-Island Link will be a 900MW 1,100 km High-voltage direct current (HVdc) bipole from the Muskrat Falls switchyard in central Labrador to an area near Soldiers Pond on the Avalon Peninsula.[5] This work will result in at least one million person hours of engineering and project management employment and 2.5 million person hours of construction employment in the province.

Key components include the following:

Construction of the submarine crossing of the Strait of Belle Isle began in 2014, with cable installation expected in 2016.[10] The contractor for the overhead transmission lines, Quanta Services subsidiary Valard Construction, was announced on August 11, 2014 and expects to complete construction during the summer of 2017.[11]

Emera will construct and own a 500 MW, $1.2-billion underwater power connection from Newfoundland to Nova Scotia, to be known as the Maritime Link. This will enable future electricity exports to the Maritime provinces and the United States.[12]

Key components include the following:[13]

Construction of the Labrador-Island Link began in 2014 and is expected to end in 2017.[14]

AC Transmission Lines

Two 265 km, 315 kV transmission lines will connect the Muskrat Falls Transmission Station to the existing Churchill Falls Transmission Station, passing near the future site of the Gull Island Generating Station. The first transmission line is expected to enter service in 2014.[15]

Both transmission lines will be supported by lattice-type steel structures and located adjacent to an existing 138 kV transmission line north of the Churchill River. The new transmission lines require a cleared right-of-way approximately 100 m wide in addition to the existing, 20 m right-of-way.[15] The existing, 138 kV transmission line from Churchill Falls to Happy Valley-Goose Bay will be terminated at a new 315 kV to 138 kV transformer in a switchyard north of the Churchill River.

Changing economics

Projected cost overruns of 50% from C$7.4B to C$11.4B, delays completing the project by 2 years from 2017 to 2019, poor planning, lack of experience, and related assumptions that were invalid or later turned out to be incorrect have led to some claiming the project is a boondoggle.[3] Major new industrial power users have used less power than expected, and less favorable than expected economic conditions have had similar impacts on smaller scale consumption. Updated power consumption estimates project consumption not reaching original estimated levels for an additional 16 years. Liberal government supporters blame the previous Progressive Conservative government for going ahead with the project, which has passed the point at which it could reasonably be stopped. Exporting the excess capacity is not expected to significantly mitigate costs to consumers. As a result provincial electricity rates are expected to jump 78% from C$0.12/kWh in 2015 to C$0.214/kWh in 2021, due largely in part to the Lower Churchill Project.

Phase 2

Gull Island

The Gull Island facility will consist of a generation station with a capacity of 2,250 MW, and the powerhouse will contain five Francis turbines. The dam will be a concrete-faced, rock-fill construction 99 m high and 1,315 m long establishing a 213 km2 reservoir with a full supply level of 125 m above sea level. The reservoir will be 232 km long and the incremental area of inundated land will be 85 km2 at full supply level. The proposed development of Gull Island would follow no earlier than three years after the sanction of Muskrat Falls.[1]

Nalcor-Emera term sheet

A $6.2 billion deal between Newfoundland and Labrador's Nalcor Energy and Halifax-based Emera to develop Phase 1 of the Lower Churchill Project was announced on November 18, 2010.[16] Under the terms of the agreement, Nalcor Energy will design and build a hydroelectric power station at Muskrat Falls and a HVdc transmission line called the Labrador-Island Link from Muskrat Falls to Soldiers Pond on the Avalon Peninsula. Emera will build an electrical interconnection called the Maritime Link between the islands of Newfoundland and Cape Breton, and invest in the Labrador-Island Link such that Emera's total investment in both the Maritime Link and Labrador-Island Link is less than 49% of the cost of the transmission infrastructure included in Phase 1 of the Lower Churchill Project. Nalcor Energy will provide approximately one terawatt-hour of electricity to Emera each year for 35 years in exchange for transmission rights on the Maritime Link and ownership of all of the Maritime Link at the end of the 35-year term.[17]

Brian Tobin point's of view

Further development of the Churchill River in central Labrador was planned for after the Churchill Falls Generating Station opened in 1972. However, the government of Québec refused to allow exports of electricity through its territory. The Lower Churchill Project passed an environmental assessment in 1980, but the project was postponed indefinitely due to concerns over market access to Hydro-Québec's electricity transmission system and financing.

According to former Premier Brian Tobin, as Labrador borders Québec, when an agreement was being negotiated to sell the power generated at Churchill Falls, the power had to be sold to an entity within Québec or pass through Québec. The government of Québec refused to allow power to be transferred through Québec and would accept a contract only if the power was sold to Québec.[18] This vision is extremely controversial.[19]

Because of this monopsony situation, Hydro-Québec received very favourable terms on the power sale contract. The contract was negotiated to run for a 40-year timespan, running until the year 2016,and then automatically renewing for 25 more years at a discounted rate.[20] According to former Newfoundland Premier Danny Williams, Hydro-Québec reaps profits from the Upper Churchill contract of approximately $1.7 billion per year, while Newfoundland and Labrador receives $63 million a year.[21]

In reality the contract was " a gamble and it's gone against [Nalcor Energy]"[22]

According to long-time Hydro-Québec critic Claude Garcia, the former president of Standard Life (Canada) and author of a recent assessment of the utility commissioned by the Montreal Economic Institute, if Hydro-Québec had to pay market prices for the low-cost power it received from the Churchill Falls project in Labrador, the 2007 profit would be an estimated 75% lower.[23]

According to the government of Newfoundland and Labrador, Hydro-Québec has reaped more than $19 billion in profits while Newfoundland has received only $1 billion in revenues from the Churchill Falls project. Québec refused to renegotiate the project, which expires only in 2041.[24] Due to the coercion involved in that deal, Newfoundland and Labrador has sought an alternate route for the Lower Churchill Project that bypasses Québec.[25]

See also

References

  1. 1 2 "Lower Churchill Project". Nalcor Energy. Retrieved June 8, 2013.
  2. 1 2 "Construction schedule to first power" (JPG). Nalcor Energy. Retrieved 2014-07-26.
  3. 1 2 3 Sue Bailey. "'Project was not the right choice': Muskrat Falls estimate surpasses $11-billion". The Globe and Mail Inc. The Canadian Press. Retrieved 2016-06-24.
  4. ↑ "Muskrat Falls Oversight Committee Report" (PDF). 2015. Retrieved 2016-06-24.
  5. 1 2 3 4 5 6 7 8 "Nalcor's submission to the Board of Commissioners" (PDF). Nalcor Energy. November 10, 2011. Retrieved December 27, 2011.
  6. 1 2 3 Rae, P. (January 2012). "5". Report on Two Generation Expansion Alternatives for the Island Interconnected Electrical System (PDF) (Report). Vol. II. Winnipeg: Manitoba Hydro International. Retrieved 2014-07-26.
  7. 1 2 "Awarded Contracts: Muskrat Falls Generation and Labrador-Island Link". Nalcor Energy. Retrieved 2014-07-26. CD0501 Supply and Install Converter Stations and Transition Compounds
  8. ↑ "CT0327 Construction of 350kV HVdc Transmission Line Section 1" (PDF). Muskrat Falls Generation and Labrador-Island Link. Nalcor Energy. June 2014. Retrieved 2014-07-26.
  9. ↑ "CD0508 Supply and install of Electrode Sites" (PDF). Nalcor Energy. Retrieved 2014-07-26.
  10. ↑ Roberts, Stephen (July 7, 2014). "Muskrat Falls work well underway in Forteau". Northern Pen. St. Anthony: Transcontinental Media G.P. Retrieved 2014-08-11.
  11. ↑ "Muskrat Falls transmission line contracted to Alta. company". CBC News. Canadian press. 2014-08-11. Retrieved 2014-08-11.
  12. ↑ "Lower Churchill Project". Government of Newfoundland & Labrador. Retrieved August 20, 2013.
  13. ↑ "Maritime Link Infrastructure". Emera Newfoundland and Labrador. 2014. Retrieved 2014-07-26.
  14. ↑ "Jobs & Procurement". Emera Newfoundland and Labrador. 2014. Retrieved 2014-07-26.
  15. 1 2 "CT0319 AC Transmission Line Construction" (PDF). Nalcor Energy. Retrieved 2014-07-26.
  16. ↑ McCarthy, Shawn (18 November 2010). "Churchill hydro deal signals era of Atlantic co-operation – The Globe and Mail". The Globe and Mail. Toronto.
  17. ↑ "Backgrounder - Nalcor Energy and Emera Inc. Term Sheet" (Press release). Government of Newfoundland and Labrador. 2010-11-18. Retrieved 2014-08-11.
  18. ↑ "Speaking notes from an address by Brian Tobin". Premier's Address on Churchill Falls to the Empire Club, Toronto. Government of Newfoundland and Labrador. November 19, 1996. Retrieved June 9, 2010.
  19. ↑ http://www.cbc.ca/news/canada/newfoundland-labrador/stan-marshall-muskrat-falls-update-1.3649540
  20. ↑ "Power Contract Between Quebec Hydro-Electric Commission and Churchill Falls (Labrador) Corporation Limited May 12, 1969" (PDF).
  21. ↑ Moore, Lynn (November 30, 2009). "Newfoundland challenges Churchill Falls hydro deal with Quebec". Canwest News Service. Montreal Gazette. Retrieved 2009-12-01.
  22. ↑ http://www.cbc.ca/news/canada/newfoundland-labrador/stan-marshall-muskrat-falls-update-1.3649540
  23. ↑ Baril, Hélène (4 February 2009). "Privatisation d'Hydro-Québec: Claude Garcia s'explique". La Presse (in French). Montreal. Retrieved 2009-12-14.
  24. ↑ Bailey, Sue (18 November 2010). "$6.2B deal reached for Lower Churchill power project". The Star. Toronto.
  25. ↑ Gazette, The (2005-12-20). "Churchill Falls deal probed". Canada.com. Retrieved 2012-12-27.
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