Iqaluit power plant expansion $12M over budget

A two-year power plant expansion in Iqaluit was supposed to cost $28M, but will likely end up closer to $40M. QEC President Peter Ma says new power plants in Taloyoak and Qikiqtarjuaq will cost closer to $30M or about three times what was budgeted.

New power plants in Taloyoak, Qikiqtarjuaq to cost 3 times projected amounts

The Iqaluit power plant expansion will cost $12 million more than expected. 

Peter Ma, Qulliq Energy Corp.’s president, spoke to a legislative standing committee yesterday.

“The original budget for the project was $28 million and we're probably going to end up around $40 million,” he said. “That's a $12 million overage, which is just under 50 per cent. So that is significant.”

The power plant expansion started in 2012 and opened this summer.

Ma says there could have been better planning and some design work wasn't finished on time.

He says he is focused on improving capital planning and reporting.

Power plant replacement costs up

Replacing Nunavut's aging power plants is going cost at least three times more than originally budgeted.

QEC's 2014-2018 corporate plan says new power plants in Taloyoak and Qikiqtarjuaq would cost more than $10 million, or just over five million dollars each.

But Ma says the real cost will be higher. 

"I think we have to realize power plant replacements are going to be in the $15 to $25 million range. I think that's really what the numbers are going to be. I think we've been low-balling the numbers to our detriment."

Ma says it will actually cost $15.4 million to replace Qikiqtarjuaq's power plant and $14.7 million to replace the power plant in Taloyoak.

He says the new totals had to be approved by QEC's board. 

Ma says the corporation has $74 million in financing from CIBC and they have to make sure all capital projects fall within that budget. 

Iqaluit hydro project already cost $9.5M

Ma also said the proposed hydroelectric dam for Iqaluit has already cost $9.5 million, and another $6.5 million will be needed to get to the environmental assessment stage.

He says QEC is looking for potential partners, including the Qikiqtaaluk Corporation.

“P3, I think, is one way to do this,” he told the standing committee. “We've had some initial conversations with, I'll call them private businesses, here but quite frankly, Inuit organizations here.”

Ma says the power utility has also been talking to mining companies about a partnership.

The potential sites for a hydroelectric plant are Jaynes Inlet, also known as Qikiqgijaarvik, and Armshow South, also known as Tungatalik. Both are on the opposite site of Frobisher Bay.