Data company in Labrador wants Muskrat Falls power

The CEO of acentre company operating in Happy Valley-Goose Bay says he's interested in buying more than 40 megawatts of Muskrat Falls power, despite the anticipated high cost.

James Goodwin of Great North Data wants to build what he believes could be the biggest data centre in Canada, and he wants to do it in Labrador using the province's newest source of hydroelectricity.

"We're very interested in taking it. We absolutely have the demand to take up a significant amount," Goodwinsaid.

Cheap power for big data

Data centres, facilities for networked computer servers, use more electricity than some other businesses because they power hundreds or thousands of computers and cooling systems.

According to Goodwin and others in the industry, Labrador is an attractive place to build a data centre because it has a cold climate and low-cost hydroelectricity from Churchill Falls.

We absolutely have the demand to take up a significant amount.- James Goodwin

Local customers pay just 3.255 cents per kilowatt-hour for power on an interconnected grid that serves Labrador West, Churchill Falls and Upper Lake Melville.

Muskrat Falls, another hydroelectric dam in Labrador slated for completion in 2020, will supply power at a far greater cost than what customers pay for Churchill Falls electricity.

It's estimated that customers in Newfoundland receiving power from Muskrat Falls could pay as much as23.3 cents per kilowatt-hour by 2022.

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Goodwin believes Great North Data could secure a better rate because the company operates around the clock.

"Because we don't have on-peak, off-peak changes in demand, it's cheaper for the power company to provide it to us," he said.

"It's not going to be as cheap as the interconnected grid, that's for certain."

Big plans

Great North Data already runs two data centres in Labrador: one in Labrador City and another in Happy Valley-Goose Bay. It's also constructing another, larger facility in Happy Valley-Goose Bay.

Still, its current operation is tiny relative to the 40-megawatt-plus centre Goodwin is proposing.

By comparison, the entire Upper Lake Melville region Happy Valley-Goose Bay, North West River, Mud Lake, Sheshatshiu and 5 Wing Goose Bay is powered by 77 megawatts.

A deal to sell 40 megawatts of Muskrat Falls power could be a boon to Nalcor, which has struggled to secure customers for the 824 megawatts the dam will produce.

"There is a significant surplus on Muskrat Falls exactly how much is going to be up to Nalcor and the government, if they're prepared to part with it but we see ourselves as a pretty easy place for them to sell the power," Goodwin said.

It may not be as easy as he thinks, according to a statement from NL Hydro that notes Great North Data is a customer on the Labrador interconnected grid.

Muskrat Falls not supplying Labrador Interconnected grid

"There are reliability concerns in Labrador East,due both to capacity/load growth as well as overall reliability of existing infrastructure," reads the statement, which notes Hydro recently proposed a project to interconnect transmission to the new Muskrat Falls Terminal Station.

"This would improve power reliability and still flow Churchill Falls Power (not Muskrat Falls Power) to residents in Labrador East. That project has not yet been approved. Hydro has a duty to serve customers;however, in light of current system constraints in Labrador East, Hydro recently proposed to the PUB a temporary restriction on approving new requests from larger consumers of electricity."

There are no current plans to provide Muskrat Falls Power to Labrador Interconnected customers, notes NL Hydro.

"Under provincial legislation, electricity rates for customers on the Labrador interconnected system will not be impacted by the Muskrat Falls Project. Therefore, Hydro cannot connect specific customers in Labrador with power from Muskrat Falls."

Contentious industry

The data centre industry has been controversial in Labrador. People who live near another centre not owned by Great North Data complained about the noise and fire safety. A stop work order has been issued against that business.

• Data centres drain power needed for future development, says mayor

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The mayor of Happy Valley-Goose Bay suggested the town should seek to support industries that employ more people, but Goodwin says Great North Data currently employs sevenpeople in Happy Valley-Goose Bay and is accepting resumes.

"We're not going to get very far if we're not a team player with the community," Goodwin said.

Read morefrom CBC Newfoundland and Labrador