The article
contained two references with a local context; one where a nuclear plant under
construction in Georgia, by a company called Votgle, experienced a spike from
its original estimate of $660 million to a “cool $8.7 billion with electricity
costs spiking as a result”. (Thinking the
Economist to be an error, the final cost was confirmed by a secondary source).
Fortunately for the
Georgia, it has a population of just under ten million people; twenty times the
population of NL. Although, that State’s
population will pay for the Votgle’s project cost overruns through their
electrical bills, it is a private company, so the tax payer is shielded from
bankruptsy. Nalcor, on the other hand,
is playing with our dime. The Uncle Gnarley Blog has a new website. Click here to visit www.unclegnarley.ca to view the latest posts!
Monday, 29 October 2012
COST OVERRUNS: IS MUSKRAT FALLS IMMUNE?
The Economist, February
18, 2012 edition, contained an article referring to America’s “…30 year itch”
with nuclear energy, manifested by its inability to move beyond the 1979
accident at Three Mile Island. The item held my interest, not for any reason related
to nuclear energy, though the lengthy period required to pay for the Muskrat
Falls scheme had me thinking of the “half-life” terminology of that industry.
Thursday, 25 October 2012
THE ELUSIVE LOAN GUARANTEE
Prime Minister Stephen Harper pledged a federal
loan guarantee, for the Muskrat Falls project or equivalent, during a 2011
campaign stop in St. John’s.
The guarantee still eludes.
The Premier is on tender hooks. She can’t schedule the debate in the House of
Assembly and MHI can’t complete its final report unless the guarantee arrives.
Is this why the Premier was recently heard in the media voicing the possibility
that the debate could take place without the guarantee?
To those who say that the Feds made a commitment,
I’d say what about the “conditions” attached to the offer.
On Sept.
12, 2012 the CBC recorded federal Finance Minister,
following a speech in St. John's, saying:
“We have a commitment…to provide the loan guarantee, and we have to work
on the details, of course…we will
honour the commitment”.
Two weeks later, on September 27, 2012, concerned
that the guarantee (and hence, the project) was falling off the rails, Dunderdale
raced off to Ottawa to meet with PM Harper but came up empty handed.
Now the end of October is upon us. Still, there
is no loan guarantee, notwithstanding the new impetus ostensibly given federal
bureaucrats by the Prime Minister. Monday, 22 October 2012
The Premier’s Speech: From Triumphalism to Despair
James
McLeod, Telegram Reporter, diligently recorded and transcribed the Premier’s
Remarks to the delegates at the P.C. Convention in Gander on the morning of
October 13, 2012. It was an important
speech, dealing with, among other issues, the fiscal situation of the Province.
The Premier was
obviously troubled by the Province’s diminished financial position, a realization
brought on by oil prices that are more inclined to the $100 mark than to the
$124.12 per barrel ‘Budget plug’ her Finance Minister’s used last March. With one third of Provincial revenues dependent
on the higher number, the Minister’s forecast deficit, this year, of $258.4
million is likely to grow, by the Premier’s own reckoning, to $600-700 million and
$1 billion next year.
Maintenance,
interrupting production on the Terra Nova and White Rose platforms, was known
at the time the Budget was delivered. The date for the end of offset payments
under the Atlantic Accord, a reduction in annual revenue of $536.1 million in
2012-13 and beyond, has been known since the deal was struck in the 1980s.
What did the Premier say in her Speech? This is one excerpt:
“Let me
tell you, we’re spending too much money…. We are. And we’ve got to get a handle
on it. …Do you know that in Newfoundland and Labrador, we spend almost $5,000
per person more than any other province in Canada in providing services to the
people of Newfoundland and Labrador.
Four thousand seven hundred dollars more”.
James
McLeod, Telegram Reporter commented on the Premier’s next volley. Remarked, McLeod: “She also said that oil
revenue has led to citizens being cavalier about government spending, because
the funding isn’t coming out of their own pockets”. Said the Premier:
Thursday, 18 October 2012
DON’T CONFUSE ‘PRINCIPLE’ with ‘PROJECT’
I was surprised that delegates to the P.C. Convention, this
past weekend, were asked to vote on a resolution in support of the Muskrat
Falls project.
Why be surprised?
Muskrat Falls is the largest construction project ever
undertaken by a provincial government; it is the legacy project of Danny
Williams and Kathy Dunderdale. Surely,
party members should be asked to weigh in and give it two thumbs up? Well,
actually, no.
At the very least, the Premier ought to have given Party
Members the courtesy of the DG-3 numbers, the latest cost estimates generated
by SNC Lavalin; she should have informed them of the cost of Muskrat power on a
KWh basis and how many billions of dollars will be added to the public debt to
pay for the project.
In a gesture of transparency, the Premier might have
insisted that Party Members be informed of the net cost to the consumer given
that NL needs only 40% of Muskrat power.
The Premier’s number, per KWh, would have factored in the 20% of the 824
MWs to Emera, at no charge, and the balance to mining interests at the price of
less than 4 cents per KWh. Such a
gesture would have constituted respect for the people who make the 'Party' function. Then, perhaps, armed with that information,
Tory delegates would be ready to vote? Alas, that is not the case.
Had a Muskrat Plenary Session dominated the entire weekend,
where seminars on Nalcor’s poor demand numbers had been discussed, the Water
Management Agreement or the alternatives to Muskrat Falls received the scrutiny
of a group still cloudy from the previous night’s festivities, it still would not
have been appropriate to invite the delegates to commit themselves on such a
project.
Cartoon Credit: John Meaney, Rand and Roar |
Monday, 15 October 2012
TOM OSBORNE: OPTIONS FOR A POLITICAL ORPHAN
When the St.
John’s South MHA defected from the Tories, he stated that the
people in his riding would help him decide where he will be seated on a more
permanent basis. I happen to live in Mr.
Osborne’s riding; I want to take him up on his offer, now.
Mr. Osborne is a lifelong Tory; he has won five elections under the P.C. banner. Upon defection, he said his problem did not arise from any single issue except for the Tory leadership, though some backbench MHAs and Cabinet Ministers may now be added to his list, given their visceral response to his move.
When Jim
Hodder, an MHA for Stephenville and former Premier, Tom Rideout deserted the
Liberal Party in the mid-1980s, they did do so, not in consequence of the then
Liberal Leader, but, ostensibly at least, on account of a policy that favoured
the Federal Liberals on oil and gas issues, in contrast to the NL centered position
aggressively (and, in hindsight, successfully) advanced by the Peckford Tories.
Mr. Osborne is a lifelong Tory; he has won five elections under the P.C. banner. Upon defection, he said his problem did not arise from any single issue except for the Tory leadership, though some backbench MHAs and Cabinet Ministers may now be added to his list, given their visceral response to his move.
Cartoon Credit: John Meaney, Rant and Roar |
In every
interview, the St. John’s South MHA was consistent: the problem was Dunderdale.
This might suggest Osborne may wish to
go back ‘home’. He will have to wait until
Dunderdale self-destructs; though, by then, the P.C. Party may be a poisoned
chalice if Muskrat Falls is sanctioned.
For this
reason, the possibility of Osborne re-joining the P.C.s, may well be a Hobson’s
choice (no choice at all). But, we’ll call
it option #1.Thursday, 11 October 2012
Robbing Gnarley to Pay For Jacques
It was Uncle Gnarley
who broached the idea of going to the upcoming mining conference at the old
hotel. I thought that it was a strange
request from the retired economist, yet, I welcomed the healthy diversion from
all the recent talk about Muskrat Falls. Knowing that there was bound to be a story, I
asked the question while en route in my new SUV: “Now Uncle
Gnarley why all the recent interest in mining”?
“Well Nav, truth
be told when I was much younger man I worked in some of the great mines in the
province. It included the iron mines in
Labrador, the asbestos mine near Baie Verte, and most enjoyably panning for gold
out west. It is how I self-funded my
education. Even though I went to economics
school, mining has remained in my blood since then. But with all this talk about mining and
Muskrat Falls I thought I should go and see what is happening. You see Nav…
I am concerned that the mining industry is falling on hard times”
With this I knew
that the air conditioning within my new vehicle would not be sufficient to keep
Uncle’s Gnarley’s face from turning 50 shades of red. He was building a great head of steam, and my
interjections would certainly be ineffective in stopping his verbal tsunami. Monday, 8 October 2012
WHY SMALL SOCIETIES FAIL
Why would
Premier Dunderdale refuse a proper debate on the Muskrat Falls project in the
House of Assembly? Why would any government, want to assume complete control
over the issue and bring upon itself full and unfettered blame if the costs
become more massive than already projected?
Dunderdale,
Kennedy and Marshall leave me in a state of bewilderment as to what influences their thinking.
My own reference
point is the late ’70s to mid-1980s, when Brian Peckford was Premier; it was a time
of deep and often bitter federal/provincial exchanges over the Atlantic Accord,
fisheries jurisdiction and repatriation of the Constitution. The level of engagement he fostered with the
public was simply huge; it still has no parallel.
It is not an
approach favoured by Dunderdale; she is not one given to citizen engagement in
public policy matters; sadly, she does not claim to be one of those confident politicians
who engage citizens freely and fearlessly nor one who regards the House of
Assembly as a focal point of our democracy.
As Peckford’s
recent book, “Some Day the Sun will Shine and Have Not Will Be No More” painstakingly
describes, the achievement of the Atlantic Accord was a tortuous exercise. NL
was ‘as poor as a church mouse’ and could ill afford to make enemies in Ottawa;
yet, he persisted. Strikingly, neither local labour nor business groups, like
the St. John’s Board of Trade or the Liberal Party or the NDP, got behind
Peckford’s dogged initiative. Saturday, 6 October 2012
THIS IS NOT DEMOCRACY
Photo Credit: NunatuKavut |
Photo Credit: NunatuKavut |
the House of Assembly has concluded.
Photo Credit: NunatuKavut |
Photo Credit:NunatuKavut |
Perhaps you believe that Nalcor should forge ahead with Muskrat Falls regardless of what anyone believes. Perhaps you believe that, since Government money is involved, a lower standard of scrutiny is acceptable. If you dare think that public money does not deserve to be treated as if it were your very own, you have chosen a slippery slope.
What ever your thoughts about the viability of Muskrat Falls or how you feel about millions of dollars public money being spent in this way, or whether you are upset that the Government has offended the Rule of Law by ignoring the legitimacy of the Public Utilities Board, I suggest that you not take your democracy for granted.
This time its Muskrat Falls; next time, it may involve an issue you feel strongly about, where another Government decision impinges upon your sense of fairplay and the sanctity of your democratic institutions.
Yes, those photos confirm that the Muskrat Falls project already under way, notwithstanding the commitments Dunderdale and co. have given the public to not proceed with construction until official sanction. Perhaps, like me, you probably see more.
Photo Credit: Clarice Blake Rudkowski |
Spending by Nalcor is proceeding at the rate of $12-15 million a month. The Nalcor President says he wants project sanction by the end of the year. Who does he think he is?
Has Premier Dunderdale no shame?
Thursday, 4 October 2012
Race for Best Opposition Party Starts Now!
Recently
the Liberal Opposition announced a number of rules which, they believe, should
govern the structure of the House of Assembly debate on Muskrat Falls.
I had some difficulty with the logic of a few of the Liberals’ Rules. The idea of examining witnesses in the morning with debate in the afternoon is questionable (why not get all the information, then engage in debate). The Libs also want to help construct the resolution (why would you even want to, unless you planned to support the resolution). I have a few other issues but they are minor. None of them diminish the fundamental importance of a ‘structured’ examination of witnesses before the debate begins.
I had some difficulty with the logic of a few of the Liberals’ Rules. The idea of examining witnesses in the morning with debate in the afternoon is questionable (why not get all the information, then engage in debate). The Libs also want to help construct the resolution (why would you even want to, unless you planned to support the resolution). I have a few other issues but they are minor. None of them diminish the fundamental importance of a ‘structured’ examination of witnesses before the debate begins.
The NDP
must now put forward its own proposal.
Both
Parties also have to decide how far to push the Government to accept their
debate ideas or at least get them to negotiate.
And they will need to push hard.
Dunderdale
has already commented that there will be no examination of witnesses; that the Vale
Inco Debate is the “template” for the Muskrat Falls Debate. Some template!
The
Opposition would be silly if they let her set the rules for the Debate in the
House of Assembly as she has for public consideration of the issue.Monday, 1 October 2012
PAN the Muskrat Falls Debate...Unless
If you feel
a sense of hopeful anticipation about the impending House of Assembly debate on
the Muskrat Falls project, likely, you will be disappointed!
You may well ask, why?
How might they have been prepared?
You may well ask, why?
If I suggested
that elected Members ought to be well briefed, in advance of voting, you
might agree.
You also might
also think: government will soon have the so-called Decision Gate-3 numbers
(the latest cost estimates) and Manitoba Hydro International’s (MHI) latest comfort
letter; isn’t that all they need to get the debate underway?
I don’t like
to answer a question with a question.
But, don’t you think Members ought to intimately understand the key elements
of the Project and the government’s shifting rationale, first? Then, the DG-3 numbers would be far more
relevant.
If you thought
all the issues relating to Muskrat Falls had been mastered by your MHAs, think
again.
The fact is your elected Members are
not ready for a debate on Muskrat Falls.How might they have been prepared?
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