Newfoundland and Labrador Hydro recently provided an update on its efforts to improve finances, with operating costs reduced by about C$19 million (US$14 million) through reducing executive and full-time positions, eliminating redundancies and implementing other cost-cutting measures.
Cumulative cost-cutting efforts include:
Reducing executive positions: In the past year, Hydro’s executive structure has been significantly reduced. With the 824 MW Muskrat Falls Generating Facility commissioned and operational, the position of vice president, power generation, has been eliminated, effective immediately. In June 2021, there were 18 executive positions budgeted. With executive reductions and executive restructuring now complete, there are now nine executive roles.
Compensation adjustments: In addition to the removal of executive vice president and senior vice president level positions, executive compensation has been adjusted, including eliminating executive vehicle allowances and performance bonuses for all senior level employees.
Cost reduction measures: Hydro has eliminated redundancies and reduced travel costs and other miscellaneous spending.
Absorbed inflationary pressures: Inflationary pressures have significantly impacted Hydro’s costs of goods and services for items such as vehicle fuel, insurance and other operational expenses. Hydro has absorbed these costs.
“We’re now seeing the true transformation of the electricity grid, as we near final completion of the integration of the Lower Churchill Project assets. We still have challenges ahead of us, but many more exciting opportunities,” said Jennifer Williams, president and chief executive officer. “The energy landscape is shifting dramatically. We must now turn our attention to preparing to meet the federal net-zero electricity standard by 2035; supporting provincial efforts to switch from oil usage in our homes and businesses; preparing for increased use of electric vehicles; and supporting an industry looking for innovative ways to capture the wind-hydrogen opportunities available in our province. Hydro is an enabler for business and industry in our province, and we … will work closely with government and the Public Utilities Board to ensure we are well-positioned and are able to step up to meet those needs responsibly.”
Hydro generates more than 80% of the electrical energy consumed by Newfoundlanders and Labradorians. The company has both regulated and unregulated operations across the province, with major hydropower generation assets in Churchill Falls, Muskrat Falls and Bay d’Espoir.
