HOW GOVERNMENT HAS GOUGED RATEPAYERS FOR 30 YEARS

Guest Post by PlanetNL
PlanetNL26: Exposing Hydro’s Rural Deficit Account - Part 1

Very few Newfoundland Power (NP) customers know they will overpay their true cost of electricity this year by 12%.  Labrador Interconnected System (LIS) customers will also overpay by 16%.  Government has legislated the utilities to over-collect from these two sets of customers to subsidize high-cost rural and isolated regions.  Hydro calls it the Rural Deficit account.

This hefty involuntary subsidy grows annually as Government-imposed rate-setting policies for the rural and isolated regions widen the cost gaps.  NP customers especially, imminently threatened by severe rate increases arising from Muskrat Falls, are being counted upon by Government to pay a hefty price for Government policy goals.  Government needs to be brought to task to overhaul the mechanics of the Rural Deficit and the rate-setting policies in rural and isolated areas before a penny of Muskrat costs is levied upon ratepayers.

TIME TO END RATEPAYER SUBSIDY OF POWER TO ISOLATED TOWNS?

Guest Post by PlanetNL
PlanetNL27: End Ratepayer Funding of Hydro’s Rural Deficit Account

Part 1 of this 2-part post exposed NL Hydro’s Rural Deficit account and the trail of regressive Government policy that created it.  It was shown that the two lowest cost of service ratepayer groups in the province are heavily subsidizing rural and isolated customers.  This included a subsidy so deep on the coast of Labrador that it delivers power at 70% less than the rate paid by the Newfoundland Power ratepayers who backstop the vast majority of the subsidy funding!  

Part 2 explores what other jurisdictions with high-cost service areas are doing and attempts to identify best practices that need to be considered here.  The PUB hearing into Rate Mitigation Options and Impacts needs to be looking at all of these potential actions and Government needs to relent in legislating out the regressive subsidies and instead promote fair policies based on economic efficiency. 

NDP LEADER ALISON COFFIN NEXT FINANCE MINISTER?

DECISIONS FACING A RESURGENT NDP

Labrador West MHA-elect Jordan Brown told VOCM Open Line lastMonday that “he has some concerns about last month’s budget” and that his cooperation requires that “things have to change in addressing the fiscal reality facing the province.” Though Mr. Brown raised other issues too, this comment is interesting if only because it goes straight to the question of how the NDP will position themselves on budgetary issues in the new minority legislature.

Bear in mind that dissolution is the result if a Budget Bill or a Confidence Motion fails, unless the Tories can demonstrate to the Lieutenant Governor that they have the confidence of the House — which current math does not favour.

My guess is that, at this point, Jordan Brown’s comment is premature and that, as well-intentioned as it may be, Alison Coffin and Jim Dinn will introduce him to a lexicon that includes critical words of equivocation — including with respect to last month’s Liberal budget.

MINORITY GOVERNMENT LIKELY SHORT-LIVED

Last Thursday night’s result constitutes the worst possible election outcome.

In other jurisdictions, minority governments are notable by their brevity as much as for their instability and lack of progress on normally intractable problems. We have some of those. Locally, the 1971 election is our singular post-Confederation encounter with minority government. It was marked chiefly by chicanery — inducements to Members to switch Parties — and it was short-lived. We would never have to worry about something like that ever happening again, would we?

Many will see the election outcome as a judgement on Dwight Ball's leadership: his indecision and his lack of forthrightness. Indeed, his poor approval ratings were earned early and got worse. Why he was the centrepiece of the Liberal Campaign ads, I’ll never understand.

TIME TO TAKE REALISM TO THE POLLS

“An election is no time to discuss serious issues,” suggested Prime Minister Kim Campbell in the 1993 federal election — a comment for which she was mercilessly pilloried. In the current NL election, the Liberals, Tories and NDP have ignored the 'elephant in the room' - our impossibly large debt. One need only look at the thin veil that separates “Direct” from the “Total” debt to wonder why something as basic as fiscal solvency can completely escape mention.

Every accountant in the province knows that, as soon as the Government attempts to “mitigate” the power rates caused by the Muskrat debacle, the bondholders - followed by the Government - will be forced to move most of the so-called "self-financing utility Debt" into the “Direct Debt" column. That's the kind whose repayment depends on taxes and like revenues 

Unless, of course, people are prepared to pay 23 cents per kWh for their power or, failing that, the arrival of the tooth fairy. 

WHAT TO MAKE OF THOSE CONFOUNDING POLLS

"Polls are for dogs" is an adage ascribed to Progressive Conservative John Diefenbaker, Canada's 13th Prime Minister. It is a view that voters ought to embrace, too, especially during election campaigns. Diefenbaker likely wasn't leading in the Polls when he made that quip, but there is still merit in the remark. 

Every hack loves Polls, as does the public. Who doesn't want to peer into the future? My advice: don't take them too seriously. There are many reasons why they will have no relationship with the outcome of the May 16th General Election. 

Context is found in the latest Poll from Abacus Data, giving the PCs five percentage points over the Liberals. A week earlier, an MQO Poll gave the Liberals a 12-point lead (among decided voters, 48% to 36%) with a 39% undecided factor.

ELECTION - JUST ANOTHER PUMP AND DUMP?

CONTACTS COUNT

       (A shoo-in)

As President and CFO

In penny-stock promotion:

Of pump and dump, and shady guys -

Mr. Dicks can’t recall a portion.

If, he's Government elect,

With experience and contacts' dance

He's a defect select perfect

For Minister of Finance.

John Tuach

Pynns Brook

May 7, 2019

PEGNL AND WHAT ONE ENGINEER'S SANCTION REVEALS

A collapsed formworks incident on the Muskrat Falls project in 2017 exposed the public to problems unrelated to either cost or schedule overruns. When one worker was hospitalized and another seven received medical assistance it became clear, as much as Nalcor did its best to hide the fact, that Nalcor’s management problems resided not just in the St. John’s Office, but also extended to ‘boots on the ground’.

Not only the eight workers, some buried up to their necks in cement, can count themselves lucky. Nalcor management, too, were spared what the Courts might have deemed criminal negligence.

Why is the issue relevant again? Last week the Professional Engineers and Geoscientists of Newfoundland and Labrador (PEGNL) issued a public notice, having sanctioned one of their own. The notice read that structural engineer Yi Ping (Peter) Liu had allowed “his seal to be applied to the structural calculations and design documents of the Draft Tube Elbow Wood Formworks for the Lower Churchill Project at Muskrat Falls….which contained material errors in design criteria and design calculations and ultimately contributed to failure of the structure.”

PARTY LEADERS ASKED TO SUPPORT INDEPENDENT REVIEW NORTH SPUR SAFETY

Editor's Note: The Muskrat Falls Concerned Citizens Coalition distributed to the media, yesterday, correspondence between Dr. Lennart Elfgren and Dr. Stig Bernander with the Honorable Siobhan Coady, Minister of Natural Resources, together with a letter from Jim Gordon to the Minister. The same correspondence was sent to the leaders of the four political parties together with the request that, if elected, they will commit, prior to reservoir impoundment, to installing an independent geotechnical panel to review the safety of the North Spur.