PlanetNL22:
Muskrat Energy Cost – Another Measure of Failure
Several leading electricity industry research organizations compile
annual estimates of utility scale generation options. These reports roll up the expected lifecycle
costs relative to energy output to provide a single energy cost figure known as
a Levelized Cost of Energy (LCOE). LCOE allows alternatives with high capital
cost but low operating cost to be directly compared to options with low capital
cost but high operating cost.
The energy industry consistently selects projects that can
deliver competitively low LCOE numbers, however, Nalcor avoided this technique
in favour of a customized and burdensome Cumulative Present Worth analysis that
avoided illustrating the true economic merit of Muskrat Falls. Although the LCOE metric was front and center
in the Nova Scotia regulatory hearing for the Maritime Link, it was avoided by
Nalcor and Government here. Little
wonder, as Muskrat’s LCOE is nothing to be proud of.
