News Releases
Government Home Search Sitemap Contact Us  

Natural Resources
June 17, 2009

Province Positions Hydro to Make Critical Investments in Infrastructure

The Provincial Government is implementing measures to improve Newfoundland and Labrador Hydro�s (Hydro) financial position to bring it in line with other Canadian regulated utilities and enable it to make appropriate ongoing investments in infrastructure to ensure reliable service.

"These measures bring Hydro�s return on equity and capital structure in line with that of Newfoundland Power and many other Canadian regulated utilities," said the Honourable Kathy Dunderdale, Minister of Natural Resources. "It is important that all parts of Nalcor are strong and financially sound to enable our energy corporation to meet its mandate, which includes being a reliable supplier of least-cost electricity through its regulated line of business, Hydro."

To accomplish these objectives, the Public Utilities Board (PUB) is being directed to permit Hydro to earn a return on equity equal to that of Newfoundland Power. The Provincial Government has also agreed to waive its annual debt-guarantee fee (valued at approximately $13 million a year) until 2010, at which point the full effect of these measures will be implemented. A $100-million equity injection into Hydro�s capital structure allocated in Budget 2008 is also assisting in retiring debt.

"These measures are necessary to ensure Hydro is able to service its own debts and maintain a stable financial structure, thereby allowing it to weather unexpected fluctuations in its business," said Minister Dunderdale. "This will support the financial viability and stability of Hydro and its ability to make necessary capital investments and upgrades in providing reliable service to its customers."

"Hydro will now be provided with an appropriate return on regulated equity comparable to other Canadian regulated utilities and its debt will be lessened through the $100 million equity injection," said the minister. "As a result of these measures, Hydro will not file a general rate application for 2010."

- 30 -

Media contact:

Tracy Barron
Director of Communications
Department of Natural Resources
709-729-5282, 690-8241

2009 06 17                                                   11:00 a.m.

SearchHomeBack to GovernmentContact Us

All material copyright the Government of Newfoundland and Labrador. No unauthorized copying or redeployment permitted. The Government assumes no responsibility for the accuracy of any material deployed on an unauthorized server.
Disclaimer/Copyright/Privacy Statement