Monday, 15 October 2018

WILLIAMS TAKES WRONG PATH TO REDEMPTION


Danny Williams' inability to address the issues raised in the Grant Thornton Forensic Audit or answer for why the Commission of Inquiry is unable to find any detailed analysis performed by his Administration on the Muskrat Falls project seems not to have inspired in himself even a moment of reflection. Rather, he returned to the Inquiry evidently for his pound of flesh as early critics, David Vardy and Ron Penney, sat in front of the Commissioner, too.
Williams could be seen lurking on the sidelines, the former Premier still hoping that some of his dignity might yet be salvaged. He was waiting for his brother, Tommy, to land a few body blows on Vardy and Penney. He left disappointed. 
Observing Tommy brought to mind a well-known citation attributed to Napoleon, one I had hoped our legal counsel would be mindful of. A paraphrasing of the adage might read: never interrupt your adversary when he is in the process of self-destruction. 

Thursday, 11 October 2018

NEEDLES IN HAYSTACKS AN ON-GOING ACCOUNTABILITY PROBLEM


Guest Post by PlanetNL
PlanetNL16: Needles in Haystacks, Symptoms of An Ongoing Accountability Problem
Participants and followers of the Muskrat Inquiry and earlier Muskrat reviews suffer simultaneously from information overload and yet a dearth of the vital information they are often seeking.  Nalcor and Government may have provided reams of materials but much of it is window dressing that gives little insight into key decision-making issues.  Take for example the Commissioner’s direct message to former Premier Williams that there is no evidence of anyone inside Government performing a critical review of Muskrat information supplied by Nalcor.

Too often it appears that the more important the issue, the less there is to be found.  In today’s post we revisit the issue of post-Muskrat rates being based on a two-tier declining rate scheme as a tiny but significant new nugget of information has been found about it.  Such a rate scheme would be a huge change in policy and one deserving of considerable study, yet it was buried in a mundane technical report with no basis of justification or analysis to defend it.
…. 

Monday, 8 October 2018

FIVE WORRYING TAKEAWAYS FROM DANNY WILLIAMS’ TESTIMONY

Former premier Danny Williams fired back at critics at the Muskrat Falls Inquiry calling their opposition to the project "reckless, irresponsible and shameful." Williams went so far as to term them “bottom feeders”. Even the Uncle Gnarley Blog earned his wrath referred to as “Uncle Nobby, Nutty or whatever”. Eventually, it seems, the Commissioner had heard enough. This is an excerpt: 


But Mr. Williams we are living in a democratic society so you being a politician in the past would know that there are people who are going to agree with you and people who are going to disagree with you. So people have a right, I assume, to disagree and while you may not like the tenor of their statements I suspect that, in a democracy, we have to give people the right to express their views. – Judge Richard LeBlanc
The Commissioner’s rebuke of Williams’ disparagement of Muskrat Falls’ critics was one noteworthy moment of Williams’ testimony last Monday and Tuesday, October 1 and 2.   

Thursday, 4 October 2018

MISSED OPPORTUNITY: SCUTTLING OF THE 2002 GULL ISLAND FRAMEWORK AGREEMENT

Guest Post by Ron Penney
MISSED OPPORTUNITY: THE SCUTTLING OF THE 2002 FRAMEWORK AGREEMENT FOR DEVELOPMENT OF GULL ISLAND 


The full development of the Lower Churchill consists of two projects: Gull Island and the much smaller Muskrat Falls project. Gull Island is projected to be a 2250 megawatt project as compared to the Muskrat Fall’s 824 megawatts. Gull Island was always felt to be the far more economic project.

In 2002 a draft Framework Agreement was negotiated with Hydro Quebec to develop Gull Island. A link to that agreement is found here.

At the time, the then Chair of Newfoundland and Labrador, Dean MacDonald, and another Board member, Mark Dobbin, broke with the rest of the Board, and opposed the agreement. The then Leader of the Opposition, Danny Williams, became aware of the agreement and mounted a vigorous and ultimately successful campaign to scuttle the agreement.

This represented the most recent attempt to develop Gull Island and led directly to the Muskrat Falls debacle.

Wednesday, 3 October 2018

FIRST THOUGHTS OF MUSKRAT INQUIRY


When former Premier Danny Williams stood to be Sworn-In before Inquiry Commissioner, Judge Richard LeBlanc, last Monday, thoughts of Hans Christian Andersen’s memorable phrase – the Emperor has no clothes - was difficult to suppress. 

The moment had nothing to do with the witnessing of the diminutive former Premier being held to account. Rather, it was the recall of a phrase spoken by a child in the Danish novel who in his innocence described what he saw. “But he isn’t wearing anything at all”, the child exclaimed. It was the one truth that every one of the emperor’s subjects had been afraid to utter.

Monday, 1 October 2018

UNCLE GNARLEY BLOG LOOKS AT ITSELF AT SYMPOSIUM

Comments for Muskrat Falls Symposium sponsored by the Sociology Department of Memorial University organized under the leadership of Dr. Stephen Crocker:

I have been asked to discuss the Uncle Gnarley Blog and the impact it might have had on public understanding of the Muskrat Falls project. I will be careful not to perform an appraisal best left to others.

One might ask: why blog anyway? It’s a lot of work. One reason was that no clairvoyance was required to see that this project would end badly and those who saw it that way had an obligation to warn the public.  The business case could not stand up to scrutiny.   Those responsible needed to be held to account.

Thursday, 27 September 2018

FORENSIC AUDIT ONLY SCRATCHES SURFACE OF SANCTION COSTING ERRORS

Guest Post by PlanetNL

Planet NL15: Forensic Audit Only Scratches Surface of Sanction Costing Errors

The release of the Grant Thornton report on Friday raised serious doubts about Nalcor’s pre-sanction justification for the Muskrat Falls project.  The report indicated enough areas where weakly constructed assumptions would add up to show that the Muskrat Interconnected option would not be the least cost alternative compared to the remaining Isolated Island option.

Despite these very persuasive snapshots, the Inquiry may only have gotten just what it asked in terms of the forensic audit’s time and budget limitations from a team with little experience in electricity utilities.  The story is not yet complete enough and the Commission should pursue reconstruction of Nalcor’s cost models using an extensive revised set of assumptions developed by an experienced utility consultant.  It’s a significant undertaking but one that appears essential to allow the Commissioner to concisely explain the project’s economic fallacy.
……

Monday, 24 September 2018

BAY DU NORD: TURNING GOOD NEWS INTO DISBELIEF

Guest Post by Agent 13
The decision by Equinor (formerly Statoil of Norway) and Husky Oil to further assess the feasibility of developing the Bay du Nord oil field, located some 500 km offshore in the Flemish Pass region, represents good news for the province. Unfortunately, the Ball Government turned what was a good news day on July 26, 2018 into one of disappointment and disbelief.  
That the provincial government thinks it is solvent enough, knowledgeable enough, or savvy enough to deal with one of those major oil companies — with their mixed portfolio of huge capital assets — is a prolongation of the same pretense that facilitated the reckless decision to sanction the Muskrat Falls project.

Friday, 21 September 2018

FORENSIC AUDITOR CONFIRMS NALCOR UNDERSTATED COST ESTIMATES FOR MUSKRAT

This post co-authored with David Vardy
The Forensic Auditor's main conclusion was that based upon its “findings and observations, at the time of sanctioning” a “combination of…potential misstatements may have resulted in the Interconnected Island Option (the Muskrat Falls project) no longer being considered the least cost option at the time of sanctioning.”

In coming to this conclusion, Grant Thornton has confirmed long held suspicions that Nalcor planned to advance sanction of the MFP regardless of the consequences. Essentially, the Forensic Auditor chronicles a narrative that suggests recklessness on the part of Nalcor Energy. The Forensic Audit was made public by the Commission of Inquiry September 21, 2018.

Monday, 17 September 2018

"AT THE MERCY OF THE WEATHER": HYDRO NOT READY FOR WINTER, SAYS PUB CONSULTANT

Guest Post by PlanetNL 
PlanetNL14: Hydro Reliability This Winter - At the Mercy of the Weather
The Liberty Consulting Group is a specialist frequently utilized by regulators to provide critical analysis of how utility businesses are performing, especially in the wake of major failure.  The NL PUB hired Liberty in 2014 to assess the causes of the January 2014 outage event known popularly as Dark NL and to subsequently monitor NL Hydro’s plans to upgrade the system.  Liberty has evaluated Hydro’s winter readiness every year since and is monitoring the Transition To Operations (TTO) efforts to integrate Muskrat Falls, the Labrador Island Link and the Maritime Link.

Thursday, 13 September 2018

TRUTH GETS A ROUGH RIDE IN WINDSOR LAKE BYELECTION

When Premier Dwight Ball kicked off the Windsor Lake byelection claiming that ratepayers and taxpayers – both – would be spared the burden of the Muskrat Falls project he wasn’t being fanciful; he was being dishonest. Hyperbole is seldom a sidebar in any election.  But this time the sheer size of the promises surely made them the main event.  Particularly disconcerting is that Ball's rate mitigation claims lacked any proof of viability. 

Sincere and sensible politicians will avoid over the top promises especially when they know that they are playing a limited hand. The Premier squarely placed himself among the less disciplined. Likely, for that reason, the public seemed to treat them with something ranging from scepticism to derision.    

Ball’s dark side has been exposed before. His doubtful narrative around the sacking of former CEO Ed Martin and how the latter still ended up with a multi-million-dollar severance package contains the same insincerity.

Wednesday, 12 September 2018

MF COALITION TO HOLD FIRST MEETING TONIGHT


Notice of General Meeting of the Muskrat Falls Concerned Citizens Coalition (MFCCC) The first meeting of the Coalition will take place at 7:30 p.m., Wednesday, September 12th at the Holiday Inn, 180 Portugal Cove Road, St. John’s, to bring our members up to date on our preparations for the hearings which will commence on Monday, September 17th.

This meeting will also be broadcast Live via our Facebook page for those not able to attend in person.

Please let us know if you will be attending in person by RSVP to info@mfccc.ca.

Monday, 10 September 2018

PREMIER'S STATEMENTS FALL SHORT SAYS COALITION

The Muskrat Falls Concerned Citizens’ Coalition, headed by David Vardy, Ron Penney and Des Sullivan (the latter also hosts this Blog) wrote the Premier on September 3, 2018 seeking specific commitments and clarity following his statements to the effect that ratepayers would not be expected to bear the costs of the Muskrat Falls project and offered to reinstate the authority of the PUB to set rates.

Following receipt of the letter, the Premier made a further statement on September 6 which fell far short of his earlier commitments. This is the text of the Coalition's response to the Premier's latest comments. This post also provides a link to the full text of the letter sent to the Premier.
.....................................

Monday, 3 September 2018

WHEN NL NEEDS A HEAVYWEIGHT THERE’S ONLY SEAMUS O’REGAN



Politics is not so comfortable an arena that politicians need only do soft-sell through photo ops and nice-sounding press releases.

Sometimes public policy issues are complicated, require intervention at a high political level and demand considerable analysis. Solutions to the big problems require political shrewdness, dexterity and good relationships at the Cabinet level.

If the politician, even having been appointed to Cabinet, doesn’t grow in the job and fails to learn how to get things done in that highly competitive business, likely he/she will have little to report at the next Poll. While many politicians prefer the soft-serve of social media platforms, the savvy ones — and survivors — will spend a good deal of time making political alliances and setting the stage for when they will need support on a make-or-break issue.

I get no sense that the Minister of State for Veterans’ Affairs, Seamus O’Regan, either understands those rules or has the heft to position himself for the long game.


Thursday, 30 August 2018

CHES CROSBIE SENDING WRONG MESSAGES

I am not quite sure who the new Leader of the PC Party, Ches Crosbie, is trying to impress with some of the positions taken in recent weeks.

While he shares the well-known Crosbie name, he is coming up short in proving that he is his father's son. Regardless of the side of the partisan divide upon which one sits, John Crosbie, Ches' father, could be counted on to be forthright and to say publicly — in the Halls of Parliament and in the provincial and federal Cabinets — exactly what was on his mind.

One example is often repeated in a CBC clip in which he is surrounded by a throng of frustrated fishers following the declaration of the Cod Moratorium. Crosbie the elder forthrightly answers one indignant protester: “I didn't take the goddamn fish out of the goddam ocean!”

Monday, 27 August 2018

BIG BALL PROMISES: LET'S GET THEM IN WRITING

“We just want to clarify, there is no way ratepayers in our province could pay or should pay for the burden of Muskrat Falls.”  The province will be “separating the ratepayers from the Muskrat Falls debt.” It is a “tremendous burden… a debt issue, not a ratepayer issue.”  These are all direct quotes which the CBC attributed to the Premier in a by-election kick-off for Liberal Candidate, Paul Antle, in the District of Windsor Lake.


What else did the Premier say? He said, “we are not looking at increasing taxes for people in Newfoundland and Labrador.”

As others have asked, if both ratepayers and taxpayers will be spared responsibility for the $12.7 billion Muskrat Falls debt, who is going to pay?

Thursday, 23 August 2018

BUSTING THE PREMIER'S NUMBERS AGAIN

Guest Post by PlanetNL
PlanetNL13: Busting the Premier’s Numbers Again
In PlanetNL12, an analysis of Government’s secretive two-tier declining rate scheme calculated the impact on three types of electricity customers.  The unfairness of such a rate scheme was made clear: the less electricity you use, the more steeply your Government wants you to pay for Muskrat.  This approach will tend to hit the many poor and working-class who struggle to pay their bills especially hard.  Meanwhile at the other end of the spectrum, the few who tend to have large high-energy homes will be pleased with little difference they’ll find on their power bill.

How did Government and Nalcor keep this unexpected twist of rate design?  Well, they simply didn’t want to tell us and for about two years they carefully misled us.

Monday, 20 August 2018

18 c/KWh – WARNING – NOT EXACTLY AS ADVERTISED

Guest Post by PlanetNL
PlanetNL12: 18 c/KWh – Warning – Not Exactly as Advertised
The last day of NL Hydro witness testimony at the General Rate Application hearings at the Public Utilities Board revealed a cruel and regressive plot twist. 

A senior NL Hydro manager on the witness stand indicated that Government’s post-Muskrat mitigated rate target of 18 c/KWh was merely an average figure.  He said Hydro was already considering a rate design scheme that would be presented to the PUB in the coming months based on two-tier declining rates.  In other words, the first part of energy used will cost more than 18 c/KWh but the rest will be priced lower.  When all residential users are added up together, the increase will average out to a 55% over today’s rate.
We won’t know Hydro’s exact details for a while, but a model is presented here that plainly shows not everyone will be hit equally.  A substantial number will be hit hard while a small number barely take a hit at all.
………….

Thursday, 16 August 2018

"VOODOO" ECONOMICS RE-VISITED

My late brother, Brendan Sullivan, was one of the first opponents of Muskrat Falls and wrote a pre-sanction article employing the term “voodoo economics”.  It described a scheme contrived by Nalcor to lower power rates early in the project by back-loading the equity repayment onto future generations. His post of November 29, 2012 stands the test of time. He was efficient in his words of caution, too. Brendan could see the project for what it was: economic smoke and mirrors. 

Monday, 13 August 2018

NEWFOUNDLAND POWER SHOULD FEEL THE PUBLIC WRATH, TOO

As NL Hydro looks for an illegitimate 6.5% rate increase — smoothing in advance of socking you in the kisser with a Muskrat-sized punch — Newfoundland Power (NP) has applied for a 1.2% increase also to take effect January 1, 2019.

Electricity ratepayers are under assault at every turn.  
The PUB has the best (legal) ammunition. It can say “no”.
The public shouldn't get careless either just because the increase sought is smaller than Hydro’s. NP is attempting to establish a precedent.

Saturday, 11 August 2018

HEAT WARNING! (From the Bard)


HEAT WARNING!
(Alert issued by Environment Canada for Humber Valley, July 17, 2018)

The sun now shines in Newfoundland,
Two-months of summer is at hand
Where many move at winter times
To warm their bones in hotter climes -

As Humber Valley holds hot air
An alert is issued to take care.

It happens every summer -
‘Some muggy!’ and ‘some hot!’
In late July and August,
Nerves with thunder shot.

Wednesday, 8 August 2018

PREMIER SHOULD SEIZE ON BETTER SOLUTION FOR POWER RATES

Guest Post by David Vardy
Premier Dwight Ball said this week that power rates will not be allowed to double. This statement is an important step toward a better solution. It recognizes that the take-or-pay power purchase agreement (PPA) is not a workable solution to the question as to who will pay for Muskrat Falls. The PPA places the burden on ratepayers which is unfair because ratepayers did not ask for Muskrat Falls. It was imposed by an overbearing government, supported by a relatively small group of people who stood to benefit.

The government proposes that ratepayers bear roughly half the cost and that taxpayers pay the rest, citing 2021 rates in the Maritimes at 18 cents per kWh, compared with 12 cents on the Island. Such high power rates, even when reduced from 23 cents to 18 cents per kWh, would still be unaffordable for low income people. They represent an increase of 50%.

Monday, 6 August 2018

MUSKRAT: A FAIR RATE IDEA THAT WON'T SHOCK YOU

Guest Post by PlanetNL
PlanetNL11: A Fair Rate Concept for Post-Muskrat

Premier Dwight Ball has been justifying a massive rate increase to 18 c/KWh as fair because he suggests it is comparable to rates paid in our neighbouring Atlantic Canadian provinces.  Such logic might succeed if only it were true: in the last PlanetNL post, it was clearly demonstrated that the expected rate in those provinces would be 12 c/KWh. 

The Premier’s admission of error has not been heard, therefore it appears Ball is sticking to his plan to punish ratepayers despite the widespread harm it will cause.

In this post, a case is developed for a post-Muskrat rate that would be fair to ratepayers. But it’s sure to be a solution the politicians will fear.  The outcome may shock many. The future proposed rate is coincidentally - and surely to Premier Ball’s chagrin - 12 c/KWh.  
…..  

Saturday, 4 August 2018

POPULAR COMMENTS SECTION TO GET GNARLY ATTENTION


Comments on blog posts bring fresh perspectives and unknown issues to attention.  
Wise, interesting and thoughtful comments come from people in all walks of life, many of whom would never think of writing a letter to an editor or calling a political office.  Not all points of view need to agree either – an exchange of views can enhance the posting under which they appear and benefit many readers.  Comments can also be a source of considerable disdain for the posting author and many who read the comments section.

Monday, 30 July 2018

THE DECEPTION OF PARITY: PREMIER'S CLAIM BUSTED

Guest Post by PlanetNL
PlanetNL10 – Atlantic Canada Energy Rates – the Deception of Parity

Where Muskrat Falls is concerned, the Government, regardless of party, has a clear track record of getting the facts wrong. The trend continues as we transition toward the operations and cost recovery phase of project.  The latest misguided gem – being relied upon by NL Hydro at the General Rate Application hearings last week – is Premier Dwight Ball’s stated rate target of 18 c/KWh for residential rates.  The Premier defends this as being comparable to expected rates in the other Atlantic Canadian provinces.  It doesn’t take much research and insight to demonstrate that the Premier couldn’t be more wrong on this issue.
…..

Monday, 23 July 2018

EXPERT PANEL NEEDED NOW TO EXAMINE NL'S FINANCIAL MESS

Noticeably more people, including readers of this Blog, want to see public discussion of a resolution to the financial mess created by Muskrat. While their numbers are still small, their voices are discernible. It seems that most people are still in denial as to the scope of the problem. Delusion causes them to believe that government would never imperil the solvency of the province.  

Yet, as one Muskrat watcher observed recently, the public will be in a "rage when they learn just the simple truths" of what the project will cost them in relation to the cost per KWh of thermal generation at Holyrood.  Likely, that rage will be compounded when people learn the extent to which the Tories and the Liberals failed to share with them the whole truth of the debacle.

Monday, 16 July 2018

MUSKRAT FALLS: BETTING ON THE WRONG HORSE

Co-written with PlanetNL
Netflix features an interesting PBS documentary called The Race Underground dealing with the technological, political and social challenges of building the first U.S. electric subway, in Boston, in the late 1800s. 
The project had a lot of naysayers. Some were concerned about the destruction of the historic city (especially Boston Common, America’s oldest public park); others about the enormous financial risk described as “… a jump into the unknown.”  The superstitious and the religious feared that going underground meant getting close to “the netherworld”. Then there were the dangers of electricity.
A vote “by the narrowest of margins” brought the matter to a close and the subway was built. The people loved it. The subway cars were clean and clothes ceased being fouled by sooty coal-fired steam engines. Congestion in downtown Boston disappeared and allowed even more people to come in. The suburbs grew rapidly. Not lost on anyone was the presence of far fewer stinky, slow horses on the streets. For investors, the new system was more profitable than the old one. 

Monday, 9 July 2018

ED AND STAN WOULDN’T LIKE GORD

Forgetfulness must be nature’s screen; one that affords people the capacity to not be weighed down by the skewed and self-serving utterances of others.  Gord, an old University friend, had a single word for them… which I plan to share with you.
Not surprisingly, the press release recently issued by former Nalcor CEO Ed Martin on the heels of comments by Stan Marshall comes to mind.
Ostensibly, the current CEO was attempting a little morale building — at the expense of the truth — following the successful transmission of Upper Churchill “recall” power across the Labrador Island Link. Understandably, he couldn’t wait for VP Gil Bennett to get the lead out on the generation component of the Muskrat Falls project.

Monday, 2 July 2018

JIM GORDON'S FINAL COMMENTS ON THE NORTH SPUR

THE NORTH SPUR MY FINAL COMMENTS
Guest Post by James L. Gordon P.Eng.(Retired)

Way back in 2014, my interest in the North Spur started when I read a short book by Cabot Martin titled Muskrat Madness. It concentrated on the questionable stability of a natural side dam called the North Spur which contained layers of sandy silt and sensitive clay. I emailed Cabot, a member of the 2041 committee, on August 27th commenting on his book, and have commented several times on the Uncle Gnarley blog on the North Spur safety. NALCOR describes the Spur as -

The north spur forms a natural earthfill dam, with a crest elevation of about 60 m, and about one km long, which connects the rock knoll to the north bank of the valley……. The crest width varies from about 1,000 m at its north end to about 70m at its south end where it has been narrowed by erosion and landslide activity in the past. The head across the spur is presently 16 m from river level upstream to downstream. The impounding of the reservoir to El. 39 m will increase the hydraulic head across the spur to 36 m and stabilization measures are then necessary to ensure its long-term stability under both normal and extreme water levels. The soils forming the spur consist of a complex interbedded sequence of relatively low permeability silty sands and sands, and sensitive marine clays.

Thursday, 28 June 2018

CHES CROSBIE TESTED: "MISTAKE" TO REPLACE MADNESS?

The recent Telegram interview with newly-minted Tory leader Ches Crosbie leaves a disturbing impression of how he will address the challenges of a Party recently described on this Blog as “broken”.

The Telegram article saw Crosbie shifting the blame for the Muskrat Falls project onto the Liberals. “What they should have done was make sure that a proper stopgo analysis was done as soon as they got into office. They frittered that opportunity away,” he was quoted as saying. Crosbie is correct on the point, but he needs to deal with the ghastly mistakes of his own Party before he is ready to throw stones at his rival.

Not to his credit, Crosbie asserted: “… PCs are like everyone else in this world: we’re only human. If mistakes were made we’ll have to take the approach that that was then, and this is now,” he told the reporter.

Monday, 25 June 2018

TONED DOWN, REDACTED WITH DELETIONS: DID NALCOR WRITE THE INDEPENDENT ENGINEER'S REPORT? (PART II)

The following is Nalcor VP Gilbert Bennett sharing, in his words, a “mark-up” of the very first Independent Engineer’s Report on the Muskrat Falls project. Bennett is sending the email to Ed Martin, Paul Harrington, James Meaney, and PR types Karen O’Neill and Dawn Dalley. The email reads:

Hello All:

Attached is a mark-up of the November 29 report. Proposed redactions are highlighted in red. Once we’re all good we can lock these in. Once Jim has circulated the appendixes from the November 29 report, I will update accordingly for the full package.

If you have any changes, please let me know…

Regards,

Gilbert

First, just in case you missed it, what Gilbert Bennett is in possession of and is “marking-up” and seeking “changes” in is not a Nalcor Report. It is, ostensibly, the “independent” work of the so-called “Independent Engineer” for the Muskrat Falls project. The year was 2013. In all, there have been a total of 20 IE reports made public since that time. We can reasonably assume that Nalcor has had a hand in each one.  

Monday, 18 June 2018

NALCOR ALLOWED TO SECRETLY CENSOR REPORTS OF INDEPENDENT ENGINEER (PART I)

Imagine if the Auditor General allowed the Department or Agency it is auditing to edit or redact parts of its Report to the House of Assembly. Wouldn’t the public lose all respect and trust afforded to that Office?

Evidence has now been uncovered showing that the “independence” expected of the Independent Engineer for the Muskrat Falls project, on behalf of the Government of Canada, was never established; that at the very beginning Nalcor was permitted to review, edit and redact the Reports before they became public.

The issue of independence was always a worry for the small group of critics of the project. Such scepticism was captured by an Uncle Gnarley Blog Post entitled How Independent is the Independent Engineer? It raised the question following the IE’s first Report (November 29, 2013).  Material evidence of complicity between the IE and Nalcor, which only recently came to light, suggests that those suspicions were justified.

Thursday, 14 June 2018

NORTH SPUR: THE ELEPHANT IN THE ROOM

Guest Post by David Vardy
Sometimes revelations occur and information comes to light which sheds real insight into the mysteries of Muskrat Falls. Uncle Gnarley has just reported on such revelations. Through an ATIPPA request our avuncular friend secured correspondence between the Premier and SNC Lavalin which offers insights into a number of interrelated matters, not the least of which is the relationship between government and Nalcor. Also intertwined in these exchanges are concerns about water management, liquefaction of sensitive clays and methylmercury contamination.  

Uncle Gnarley reported on these mysteries in his post at "Extremely Frustrated" Premier Goes To SNC-Lavalin For Advice.  The Premier wrote to SNC Lavalin to seek advice on the impact of raising and lowering water levels upon erosion of the river banks on the Churchill River. The response from SNC Lavalin urged caution with respect to such variations in water levels, similar to the advice rendered to the advice rendered to the Joint Panel by Dr. Gregory Brooks while dealing with the North Spur.

Monday, 11 June 2018

"EXTREMELY FRUSTRATED" PREMIER GOES TO SNC-LAVALIN FOR ADVICE

The following statement is not correct:

“Running at full output, Churchill Falls (CF), would discharge about 2000 cubic metres per second into the Churchill River. Assuming no reservoir draw down, this level of discharge from CF would by itself provide about 630 MW of production at Muskrat Falls. We could run MF at a higher output level for a period of time and draw down the MF reservoir… we could keep it at Muskrat Falls as well as anywhere else.”

That was Gil Bennett talking a couple of years ago to law student and political Blogger, John Samms, who is now on staff in the Premier’s Office. Note the word “drawdown” to which I will return.

At the time Bennett was telling Samms how Nalcor intended to access surplus power from the Upper Churchill; the amount that exceeded what Bennett erroneously thought was the full contractual power commitment to Hydro Quebec. That assumption didn’t work out too well for Nalcor, the Quebec Superior Court having ruled that Hydro Quebec is entitled to all the power that the Upper Churchill can generate. The Water Management Agreement, intended to coordinate the flow of water, was stillborn too.

Monday, 4 June 2018

LIBERAL PARTY WILL IGNORE THE ABACUS POLL AT THEIR PERIL

The most recent Abacus Poll reflects a NL society increasingly aware of its fiscal circumstance. A realism long missing has returned. Six in ten people now see budget deficits and jobs for the young as a very big problem.

Infrastructure, jobs in general, and health care are matters of similarly high concern. Just possibly the public possesses fewer expectations of their political leadership than even the politicians believe. Scepticism seems to underscore the new Abacus Poll, and for this reason alone it a refreshing read.
Polls are frequently less a reflection on the subjects assessed than of the populace whose views are being aggregated. It is hard not to sense in the Abacus data that NL is in a state of readiness for change.  

Monday, 28 May 2018

ON THE LOOKOUT FOR OUR MEMBERS OF PARLIAMENT

Go ahead. See how quickly you can name the Province’s seven Federal MPs. Can you name even just the one in your riding? If you are having difficulty, it might not be due to memory loss.

It could be that traditional media does not readily seek out our MPs for public policy comment. Or that MPs prefer the non-confrontational media presence afforded on social media platforms. Possibly the whole lot are better suited to images than words anyway. Either way, the seven MPs are seldom part of the narrative of political life in this province. And that is too bad.

Thursday, 24 May 2018

MUSKRAT FALLS COALITION GIVES FIRST REPORT

First Progress Report from Muskrat Falls Concerned Citizens Coalition
Introduction
Some people have been asking what is happening with the Inquiry into the Muskrat Falls project. This is our first update. Next time, a web site, which is under development, will be ready. Future updates will be found there and that platform is expected to offer timely communication throughout the period of the Inquiry. 
What's Been Happening?
The Coalition was created to serve as an intervenor in the Muskrat Falls Inquiry. Upon invitation of the Commissioner the group submitted our interpretation of the TOR, as did a number of others. It can be found here.  The goals of the Inquiry are set out on the Inquiry Website, particularly in the Commissioner’s Interpretation of his Terms of Reference (TOR) here

Monday, 21 May 2018

MEMORIAL LOOKS ELSEWHERE FOR LEADERSHIP. IT SHOULD LOOK AT ITSELF, TOO.

It seems that Memorial University President Gary Kachanoski is frustrated with the Government, though it is a bit late to express that sentiment. Memorial largely ignored the warning signals about debt and risk to civil society from a decade of overspending by successive government Administrations. When the University ought to have sounded the alarm, it instead finds itself in the same boat as every other institution.

Memorial was forced to cut $8.9 million from the University's operating budget this year. In addition, the Government threatened to cut the subsidy to the University by a commensurate value of the increase if tuition fees were hiked for local students. Said a clearly disappointed University President, the province has to decide what kind of university it wants.

Saturday, 19 May 2018

THE BARD ON BULLIES IN THE LEGISLATURE


HILLBULLYS 
Pre-school kids could replace the Assembly on the Hill:
A childlike raucous racket, big hum in air to fill.
Loud bickering and bullying that does little to instill
Confidence in  leaders who know no leading skill.

Introducing rules-of-conduct to regulate ill will, 
To change a human’s nature from decency near nil.
Is distraction from the urgency to lower living bills,
And all the while attention strays from frills at the till.

John Tuach
May 16, 2018

Monday, 14 May 2018

HYDRO SPINNING A TALE FROM BOTH SIDES OF ITS MOUTH

Written with copious notes from PlanetNL
Few members of the public seem concerned that Hydro is pursuing two rate hikes, the equivalent of 18.6%, to be applied over the next two years. In addition, Hydro wants the PUB to charge for Upper Churchill Recall power on the same basis as if it were generated by oil at Holyrood. Hydro wants a “deferral account” for “rate mitigation” which, for reasons described by PlanetNL, may turn out to be small dollars anyway.
Public quiet over the Hydro rate application suggests they may have already become numbed to it all. Having been deceived by their own government(s) since 2010, and having perhaps learned that fake news is not just an American concept, it is possible that, rather than get mad, they plan to get even. Installers of heat pumps have a bright future in this Province.

Thursday, 10 May 2018

IS RATE MITIGATION EVEN POSSIBLE AFTER MUSKRAT?

Guest Post by David Vardy

This is the sequel to my post of March 19, 2018 on the financing of Muskrat Falls called The Impossible Dream Part I: Financing The Labrador Transmission Link. In this post I measure the increased costs associated with Muskrat Falls and discuss the impact on rates and the potential for rate mitigation.
Rate Mitigation
A recent Telegram article (“Power Rate Options Still Unclear”, Telegram, May 5, 2018) . refers to “$60 million to $70 million required to decrease customer rates by one cent per kilowatt hour”. This suggests that, if rates were increased from 12 cents to 17 cents, revenues would rise by $300 million to $420 million. This is highly unrealistic.

Monday, 7 May 2018

BULLYING IN HIGH PLACES: THE CASE OF CATHY BENNETT AND PREMIER DWIGHT BALL

A former Cabinet Minister suggested recently that when partisan politics comes in contact with any issue, it becomes distorted. I thought of the comment’s applicability to the current furor about bullying in the Ball Liberal Caucus, especially the case of Cathy Bennett. Is politics a motivator in how it is being disclosed? How pervasive is the problem? Is it endemic to political office anyway? Who must take responsibility? What “fixes” if any are required?

Those questions beg one more: if the allegations are proven true, what fixes are required, that is to say what effect should the outcome have on public policies?
Bullying is complicated even in the words and context used to describe it. Now that vile behaviours have joined the day-to-day experiences of Ministers and MHAs, and are increasingly part of the political lexicon, commentators and the public have an obligation to include them in debate — as fraught with risk as such a polarizing issue may seem. 

Thursday, 3 May 2018

CAN CHES CROSBIE REBUILD A BROKEN PARTY?

If new Tory leader Ches Crosbie had hoped to wear the moniker “Landslide” after last weekend’s vote, the Party had no qualms denying him any such expression of unanimity.
The contest was a straight two-way leadership race. With Crosbie winning 57% of the vote against 43% for Tony Wakeham, according to the media, the outcome was respectable but hardly overwhelming.

Wakeham came into the race late and with a communications plan that didn’t include the general public. He exhibited little knowledge of public policy issues, too.

In contrast, Crosbie demonstrated preparedness and a willingness to engage people on the ground and on social media. His legal experience shone through the process; his speech was thoughtful and careful.

Sunday, 29 April 2018

NOT JUST EDDIE JOYCE; KIRBY AND THE PREMIER SHOULD GO, TOO


On Saturday the Tories elected a new Party leader. That’s nice. But will he lead? There has been no effective Opposition for at least a decade. Nor has leadership come from the Government benches over the same period, either.
When the economy is going well, business is booming and employment rates are high, leadership of all kinds — especially political leadership — is a commodity taken for granted. Governments play an important role in this economy, even if far too often it is with a negative effect. 

Perhaps it is in the nature of societies to think that things happen for no particular reason. 

Truth is, that’s rarely the case. 

The inability to lead, to be proactive, to have a nose for crisis, and to be willing to undergo the stress of intervention, is at the heart of the Liberal Government’s latest crisis, too.

Thursday, 26 April 2018

TRUTH RUINS NARRATIVE FOR WILLIAMS, MARSHALL AND COADY

Life might be so much simpler if, like innocents on Christmas Eve, we would only believe.  

Stan Marshall, Danny Williams, Siobhan Coady — each one has a narrative that doesn’t fit with the facts, that can’t stand up to the scrutiny even of youngsters. Interestingly, the truth could easily favour Marshall and Coady, but they are unable to resist “spin”; other versions, supposedly, are more worthy of gratitude and acclamation. 
For Marshall, it’s this comment to reporters following Nalcor’s AGM: “Any megaproject in the world would be happy to be where we are.” Presumably, the CEO is referring to the progress made on Muskrat in 2017 which he, ostensibly, influenced. Problem is, he omits that productivity for its major contractor is still only around 22% (that's an average 2.2 hours of work on a 10-hour shift) and that much of this performance is related to poor management by Nalcor. Should we await another multi-million dollar claim by Astaldi?

Monday, 23 April 2018

HOW NALCOR UNDERMINES PUBLIC POLICY; BUYS FRIENDS AND SILENCE

Crown corporations are established for a multitude of political and public policy reasons. Most, ostensibly, fill market gaps in services and activities “ignored by for-profit private organizations” and therefore deemed the responsibility of government.  

A Paper by Philippe Bergevin on the website of the C.D. Howe Institute (from which the quote above was drawn) examines risks posed by the Crown Corporation model. It suggests that whether Crown corporations are “relevant” or if they serve only to “complement or displace private activity”, their policies should be limited in ways “to more clearly align them with the institutions’ core mandates and the defensible features of their economic rationales”.

Thursday, 19 April 2018

THE INQUIRY: INTRIGUE IS WHERE YOU FIND IT

The Hearing Room, on the first day of the Muskrat Falls Inquiry, might have served as metaphor for the author Joan Clark, and her story of madness and altered perception in “An Audience of Chairs”. She would find plenty of sub-plots here, except that the madness to be assessed will likely have only a tangential association with delusion.

Even that assumption — as with all those that gave the project its silver lining — may seem excessive. Madness? Delusion? On this first day, at this Inquiry, at $12.7 billion and counting, we might wonder: who is asking? That’s because the audience was mostly chairs. The place was virtually empty, except for the usual bevy of blue suits and a few others.

Monday, 16 April 2018

SECRET “MANAGEMENT RESERVE” FOR MUSKRAT UNCOVERED

If there are still surprises hidden deep within Nalcor’s crumbling walls, recent information obtained by this blogger under ATIPPA has brought at least one more of them into the light. (Another is that the once-limp Muskrat Falls Oversight Committee is exhibiting serious signs of life!)

Documents obtained from the Oversight Committee suggest that Nalcor may have maintained a secret “Management Reserve” budget for a category of risk known as “Strategic Risk”. The Reserve was kept out of the estimates for the project and placed under the control of the “Gatekeeper”, presumably the former Nalcor CEO, Ed Martin.

Nalcor evidently understood that such an allocation had important budgetary implications for the project - and for their ability to sell the scheme. But its importance was too great to let the public know anything about it.

The fund was not revealed to the PUB during examination of the DG-2 estimates or later. 
But, in addition, Nalcor also did not disclose any allowance for Strategic Risk in their DG-2 estimates, DG-3 estimates, or any estimates provided to the public prior to 2016.

Why would any category of project costs have been kept secret, or excluded?

Sunday, 15 April 2018

A POET'S PLEA: WE NEED TO KNOW WHO SOLD THE FARM

RISE AND FALLS

Standing firm on guard for thee,
we coalesce to make our plea,
and while the horse has left the barn,
we need to know who sold the farm;

An enterprise whose smell pervades,
the waters and its everglades;
whose genesis just boggles minds,
while mares will watch their bare behinds;

Thursday, 12 April 2018

ANDREW NIKIFORUK A SOULMATE FOR DAVID VARDY

David Vardy, a frequent contributor on this Blog, can often be found discussing how the failure of the Muskrat Falls project is symptomatic of a broken democracy. He met up recently with Andrew Nikiforuk, an award winning journalist who has written for twenty years about the energy industry.

Monday, 9 April 2018

A DEBACLE AND THE FEDERAL GOVERNMENT'S ROLE IN IT (Part II)

This is part II of a report chronicling Ottawa’s role in the Muskrat Falls project as both enabler and colluder with the Government of NL and Nalcor.  It discusses numerous areas, albeit briefly, where the Feds ignored blatant holes in Nalcor's business case for the project, each embodying the certainty of project failure. It also describes how they empowered Nova Scotia to control award of the Federal Loan Guarantee (FLG), failed to perform essential due diligence after the project was sanctioned and, inexplicable, failed to intervene as the project's price tag doubled for reasons it had an obligation to all the taxpayers of Canada to understand.   

Thursday, 5 April 2018

FEDERAL COMPLICITY: THE UNTOLD STORY OF MUSKRAT FALLS (Part I)

This two part report chronicles Ottawa’s role in the Muskrat Falls project as both enabler and colluder with the Government of NL and Nalcor.  How the Feds empowered Nova Scotia to control award of the Federal Loan Guarantee (FLG) is discussed along with Ottawa’s failure to perform basic due diligence to protect Canadian taxpayers and reduce or eliminate the risk of default by the Government of NL. The articles describe the manner in which the Feds were complicit in an unviable project advanced under unwarranted assumptions. It also details how they refused to intervene as the MF project sank under gross management incompetence.  

Introduction
When the Government causes a catastrophe in our name, we are all collectively responsible. Such is the case with the Muskrat Falls project. 
In one way or another NL will pay for the debacle; just not the whole cost, because the accumulated provincial debt compounded by excessive borrowing for Muskrat has made our total debt unmanageable. We are effectively broke. 
But even if NL’s coffers were full, taking into account the role played by the Government of Canada as “enabler”  without whose guarantee Muskrat would have died in design, the Feds’ complicity in the sanction and its aftermath makes it a responsible party. The Federal Government’s actions, and often inaction, ought to be exposed.