Hey there, time traveller!
This article was published 11/4/2014 (902 days ago), so information in it may no longer be current.
La Capra Associates, a team of expert consultants on development plans, was asked by the Public Utilities Board to test Hydro’s own numbers that support its development plan for two new dams — $6.2-billion Keeyask and $10.5-billion Conawapa — and an new transmission line to the United States for export sales. Here’s its synopsis of findings:
Beyond MH’s (Mantioba Hydro’s) published results, our review identified a number of limitations and concerns with MH’s planning methods, resource options assessments, alternatives considered, and sensitivity testing. Some of the concerns we discuss in our report and appendices include the following:
• MH’s assessment of the year of need (for new domestic supply) is very conservative.
• MH’s assumptions regarding alternative generating options tend to overstate costs and ignore industry expectations on improvements over time.
• MH’s economic modelling did not test the plan with standard metrics other than 78-year NPV (net present value), such as IRR (internal rate of return), break-even, or interim period NPV.
• MH’s selection of alternative development plans did not consider a sufficiently broad spectrum of alternative. (LCA is working with two additional alternatives that MH has since prepared.)
• MH’s uncertainty analysis uses an unconventional comparison method that does not convey the relative performance of alternatives on comparable assumptions.
• MH has not established the need for expanded transmission to the US, particularly in cases without Conawapa.
• MH assumes very little uncertainly in the cost of Conawapa and the associated transmission facilities.
LCA is continuing its review of the MH analysis of the alternative development cases with data recently received from MH and will supplement this assessment when that review is complete.
La Capra Associates, Inc.
One Washington Mall, 9th Floor
Boston, Massachusetts 02108