Nova Scotia Power's parent company says it's not waiting for approval from the province's Utility and Review Board before going ahead with a $1.5-billion subsea cable known as the Maritime Link, part of the Muskrat Falls hydroelectric proposal.
If Nova Scotia Utility and Review Board decides the project is too expensive for Nova Scotia Power ratepayers, shareholders with Emera Inc., the utility's parent company, could be on the hook for $60 million.
"As I said, we believe it's the lowest cost option for Nova Scotians and no costs will go through to Nova Scotia Power ratepayers unless they are approved by the UARB," said Sasha Irving, a spokeswoman for Emera Inc.
Emera Inc. is a minority partner in the Muskrat Falls project and is responsible for the Maritime Link, which may see as much as 40 per cent of the electricity from the 824-megawatt project moved to Cape Breton by subsea cables.
Irving said Emera Inc. is committed to the project. But if the company walks away, it will have to pay the federal government a $60-million penalty.
Prime Minister Stephen Harper travelled to Labarador last week to sign a term sheet for a federal loan guarantee. One of the key points of that agreement states the loan guarantee is conditional on all parties sanctioning all aspects of the Muskrat Falls project.
Emera Inc. said it will apply to the Nova Scotia Utility and Review Board for a rate increase to cover the cost of the Maritime Link by mid-January, after it has signed an agreement to build it.
If the Utility and Review Board decides the Maritime Link is not in the interests of ratepayers, Emera Inc. will have several choices: its shareholders can finance the entire Maritime Link, it can look for partners or it can walk away from the project.
"Possibly if the UARB were to not aprove the project we would be able to take that information and reapply in a new process," she said.
Following Harper's visit, the CEO of Emera Inc. said the projected cost of the subsea link had jumped from $1.2 billion to $1.5 billion.
Chris Huskilson told a conference call that "better information" on the costs associated with the complex leg of the project has prompted a revised estimate of the total cost to between $7.5 billion and $7.7 billion.