Thursday, 24 November 2016

NALCOR CAN'T BE TRUSTED TO NEGOTIATE WITH HYDRO QUEBEC

The public has been in a state best described as “delusion” since Danny Williams unveiled the Muskrat Falls project. However, this condition is due less to a wilful state of denial than it is to a deliberate, preordained, and persistent institutional and politically inspired deceit.

Neither the government nor the crown agency, Nalcor, can find vested interest in keeping an ill-informed public abreast of the problems that affect them financially - both individually and as a society.

Proof is the credibility which Premier Ball still ascribes to Muskrat. It will be a good project ‘in the long run’, said Ball again recently - seemingly unmind of its problematic state and their consequences.

The deception is also found in the government’s refusal to properly describe the project’s legal status – following the Quebec Superior Court decision.


It is confirmed by Nalcor's refusal to release all its data regarding the North Spur instability problem or to send it to a group of international experts for independent review.

It is underscored by the rejection of basic oversight and by persistent information spin.

As David Vardy discussed in recent posts, Nalcor has even taken steps to ban publication of reports prepared by the Independent Engineer – prompting him to appeal to the Freedom of Information Commissioner.

The same tools of secrecy and deceit were used by Nalcor to obtain sanction.

Institutional deceit is the moral and intellectual equivalence of corruption.

Nalcor continues the strategy anyway.

Fortunately, the law demands that the government give disclosure to and to obtain approval for the debt funding which keeps the project going.

But leadership - not the law - should tie the recent extra payment of $150 million to Astaldi – a group long blamed for cost overruns and schedule delay. Leadership - not the law - should identify who should take responsibility for a badly written contract – and the choice of Astaldi in the first place.

Stan Marshall can articulate as he pleases that senior management are all “good people” but the public is kept in the dark, by him as by his predecessor, why Astaldi still has claims outstanding estimated at $800 million.

Of course, this façade of competence is as leaky as the cofferdam at Muskrat.

Yet, as David Vardy pointed out, every day nearly $10 million is spent on the project - and the final cost is anyone’s guess.

So severe is the problem of trust, Nalcor can’t write a straightforward press release about the leaky cofferdam - though the Mayor of Happy Valley-Goose Bay is dragged out of bed at 3:45am and given warning!

Days later, the CEO Stan Marshall is the one making a statement – seemingly no one less senior, including the Executive V-P responsible for the project, has the credibility to go on the public airwaves.

Whatever the leaky cofferdam’s technical implications – including for further project delays – one might reasonably expect, given that the project costs continue to climb, that Nalcor would have advised if the dam contract was “lump sum” – and if the problem is the contractor’s cost – or if this contract, too, has been assigned the special status of “Unit Pricing” – a favourite fabrication of Ed Martin.

The trust issue is important, now, for the next big issue.

It is important because Stan Marshall can’t seem to explain how the Upper Churchill renewal contract legal case can go from “not about water rights” to “…there are some issues…”

And, remember, that comment was preceded by Marshall’s own assertion: ”that Court case will have no major impact on Muskrat Falls whatsoever..."   He makes no offer to investigate who is proffering the poor legal advice. He is inured to the reality Nalcor management are a group being laughed at. 

Increasingly, the public is aware that the Muskrat Falls project ought never to have been sanctioned.

The public understands on an individual basis – even if Dwight Ball does not - the financial consequences of a doubling (or worse) of their electric power costs, even they don’t grasp the intricacies of complex legal or power engineering jargon. 

But the latest charade – enabled by Ball as much as by Nalcor - should serve as an ugly reminder of the cynicism that pervades our public affairs and from whence it comes.

Hydro Quebec, we are led to believe, wants to “bury the hatchet”.  A persistent impulse by the Premier not to speak the truth compelled him to say in the House of Assembly that "What we saw…coming out of Quebec is really another sign of something that we've been noticing for a few weeks….we'll see where this takes us, there's no sense in rushing into things right now".  

Ball would have us believe the Quebec comments were inspired by the Quebecers – when we know otherwise. Indeed, Stan Marshall has already indicated he is talking to them and highly credible reports from people who have met with Marshall say he has confirmed those discussions are taking place.

Quebec Hydro knows they have Nalcor over a barrel. They know that regardless of how much Muskrat costs it will generate far less firm power – in the absence of a Water Management Agreement - than Nalcor promised.

No deal with Hydro Quebec can occur without significant additional costs to the public. But the fear is that Nalcor will get its deal and shield itself from exposure to examination of its management performance and poor decision-making.

Rather than a Royal Commission of Inquiry into Nalcor – into the contrived assumptions that led to Muskrat sanction and issues of competence – the public are likely in for another snow-job.

Nalcor cannot be trusted to negotiate any major issue with Hydro Quebec. It can't be permitted to shrug off another huge giveaway as it did to Emera and to Nova Scotia.

At the beginning, the Clerk of the Executive Council ought to chair any discussions/negotiations between Nalcor and Hydro Quebec. He is the lawyer - and one of the 2041 Group members - who warned Nalcor to obtain legal clarity on water management before proceeding with the project.

But the oversight should not stop there. Any agreement concluded ought to be submitted to the PUB for public review or, alternatively, subjected to a referendum.

It's time for the public to stop paying deference to incompetence.

12 comments:

  1. Right On..... as Snook would say. We have seen far too much incompetence, and as Liberty says IMPRUDENCE.
    Winston Adams

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  2. The people responsible should be held accountable...history will not be kind to Danny et all. Nor Dwight and his clowns. We are screwed beyond belief. :(

    Also it seems no one cares, or are afraid to speak out for fear of reprisals.

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  3. Reprisals you suggest........
    In 2012, before Muskrat sanction, I made a presentation at the PUB, as to alternatives to Muskrat. My analysis went unquestioned as to its merits. There were no reprisals, perhaps they assumed it would be my only appearance.
    Some months later at a Nfld Power Rate Application, I presented a detailed and hard hitting criticism of Nfld Hydro and Nfld Powers Conservation and Efficiency Plan, and of our Consimer Advocate. Just before the presentation, which was sent in advance to the PUB, I was called aside by PUB officials and advised that the language I had used was near `crossing the line` as to acceptance, but that they would allow it. No doubt the content made some uncomfortable. Again, no officials from the power companies who were there questioned my analysis.
    A few weeks later I was served a legal notice to appear in court, on a unrelated matter. The matter involved a long standing issue with Eastern Health (an issue of mistreatment of my mother, who had suffered from Altzheimers Disease going back some 15 years, and was dormant for at least the last 7 years). And so I was dragged back into numerous applications filed against me and went on for about 18 months.
    What appears not to be a coincidence was the fact that the application filed against me was dated, I believe, the day following my second appearance before the PUB, the one that near `crossed the line`
    At the various court appearances their legal counsel filed false information: that I had gone bankrupt or insolvent, and also linked other false information from people with a similar name as mine.
    A most telling tactic was to see them file my 8 page initial presentation at the PUB about Muskrat Falls, as of some importance for them it seemed, to show something of my mental health status.
    Needless to say, these events, without legal representation by me, took its toll, and largely took me out of the Muskrat debate.
    By April 2016, I was again at the PUB, having filed test data in support of important heating efficiency issues, and its importance to Muskrat and Demand Management and energy reduction, and which also discredited their own testing report, their report funded by ratepayers money.
    I have had no recent summons. I continue with testing to further evidence based data (an important requirement for accurate power forecast, a `best practise` method which neither of our utilities here do).
    Last month, Nfld Power, in their billing flyer, for the first time acknowledges that efficient mini-split heatpumps can save significant energy for residential customers. Something they should have started 10 years ago. Yet they are firm that they will NOT DO as other provinces do, and as customers want: give incentives to help with excellent technology. Their web site for information for customers to be better informed on this technology remains no doubt the worst in the country.
    Winston Adams, Logy Bay (electrical engineer, once employed with Nfld Hydro for 5 years, designing and commissioning 230Kv infrastructure)

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  4. Unbelievable.......such spineless and crass behaviour by grown men and women....Speaking the truth has negative consequences for sure...

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  5. This comment has been removed by the author.

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    1. I'm just curious, WHO should then be talking to HQ? And when?We got to find someone competent/trustful eventually! (Obviously, that should have happened before we started this boondoggle)

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    2. I can do it and I am sure that there would be a positive result. I know how to connect with Hydro Quebec and they want to talk to someone that has knowledge about the global trend regarding on and off grid energy projects. I have been attending energy events all over the world and believe it or not this Muskrat Falls Project is being discussed globally and laughed at by everyone that know how much Hydro, Wind & Solar projects are worth. Based on what we will get out of this project, this one comes in at approx. 50-1 odds of ever having any net revenue. The way it's headed now this project will go down in history as the worst energy investment in the past or could ever happen in the future. There is a way to come out of this on top!!

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  6. The only way to proceed is to have an independent businessman who knows about energy sources and options, someone that has something to lose and everything to gain by sitting down with Hydro Quebec, someone who has already met with Hydro Quebec regarding Renewable Energy options and was treated fairly, someone that was recommended by Hydro Quebec to perform a task, awarded the tender and did it successfully, someone that Nalcor disqualified the right to bid on local contracts with NLH & Nalcor and can prove it. Looking forward to the challenge. Nothing to lose, everything to gain for all. Power To The People.

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  7. Quebec is circling like a flock of gulls ready to pick the last pound of flesh from our bones by wresting from us the remaining resource on the Churchill River, Gull Island, and potentially extend the infamous upper Churchill contract in their favour. They sense that we are vulnerable because of the financial, technical and environmental fiasco playing out at the Muskrat project. By all means negotiate with them but keep in mind that sometimes 'no deal' can be the best deal of all. This surely would have been the best deal in the sixties on the upper and certainly would have been the best deal for the Muskrat boondoggle, when it was approved to proceed.

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    1. "Quebec is circling like a flock of gulls ready to pick the last pound of flesh ..."

      Not a very productive comment here, nor very representive. HQ is always looking for opportunities, the same way as Emera or anybody else is.

      Contrary to some Nfld politicians , HQ knows very well that there are no points in engaging any discussions if it doesn't lead to a win-win agreement. Not so sure about Nalcor / some politicians; they always seem to demand "one way" concessions... (Not win-win...)

      The 1969 MF HQ/BRINCO contract was a win-win agreement WHEN signed. With all the BS that followed: HQ should have just walked away, and build its next dam (James Bay), which would have ended up cheaper.

      With all this continuing Quebec bashing, HQ is probably more incline to just STAY UNDER THE RADAR instead of negotiating any win-win proposals. We'll probably sink alone with MF.

      Don't expect hear HQ until 2041...

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  8. There is one positive note: Ball, Dunderdale, Williams et al have provided authors of textbooks of engineering, business, politics and possibly criminology with an outstanding example that will stand for decades to come of how not to run a project. Such a broad range of incompetence is surely of historic interest.

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  9. "Such a broad range of incompetence is surely of historic interest"

    I never seen such a broad range of incompetence either.

    But the magnitude of the financial boondoggle (and the total lack of transparency) is such that we can't rule out an even greater level of corruption...

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