Guest Post by PlanetNL
PlanetNL30: Did Trump Copy Nalcor’s Playbook?
Déjà vu really stings when you finally see it. Virtually everything communicated about Muskrat Falls pre-sanction by Nalcor – and the Government that manipulated Nalcor’s puppet strings – was a shameless string of Donald Trump style falsehoods. We know the kind well now as soon as you hear it: some ridiculous statement from the huckster-in-chief is best understood when you simply turn his premise around 180 degrees. Then you instantly recognize the truth as the exact opposite of what was said. If only we were all so smart 10 or so years ago.
Let’s run through just a few examples.
Nalcor said oil prices would go through the roof and
ratepayer couldn’t afford it. They
completely misread the cyclical market behaviour of oil. Somehow, they were building an oil and gas division
and apparently staffing it with dummies who did not understand the history of
the industry and how these cycles happen. Nalcor also completely misrepresented what
shale gas development was doing to create softer electricity prices and oversupply. Finally, if they had been proven right about sustained
high oil prices, they failed to identify that oil exploration and production profits
would hedge against any increased costs of using oil at Holyrood – the gains in
the oil and gas sector would always be greater than the losses at Holyrood.
Nalcor said they themselves were the best experts
they could find. The extended DarkNL
outage in January 2014 was the first major event to bust that wide open. The Public Utilities Board brought in a real
expert consultant who found widespread incompetence and failure to maintain the
existing utility system to anywhere near adequate utility reliability standards. Since then, about a billion dollars has been
spent upgrading the system and it is those expenditures that account for the
lion’s share of rate increase since then, certainly not demand growth or
skyrocketing oil prices.
Nalcor said the Holyrood plant was too old and
decrepit to rely on and the boilers were not flexible enough. The reliability-driven fixes implemented in recent
years have Holyrood working in peak form and consultant condition assessments indicate
the plant is quite sustainable. Ongoing
studies before the PUB also recently indicated there are low-cost upgrades that
can be done to dial down power output to further decrease fuel burn in the
shoulder seasons. Improved flexibility
and reliability were always available but Nalcor chose scapegoating the plant
and neglecting it as their preferred strategy.
The chief architects of Muskrat, like Trump,
stayed true to their own cause right to the bitter end. Even before a Commission of Inquiry, they
defended the indefensible despite the facts being against them.
It should have been inconceivable that highly
placed executive leaders could take the Holyrood plant and its very high 15
c/KWh energy cost and not replace it with a strategy that would cost a lot less
as other utilities were doing. They completely
buried the single-most effective solution to diminish the Holyrood problem: stop
selling power for less than the cost of production! Had they simply changed the rate structure, demand
for peak winter electricity caused by electric heating would have substantially
decreased and the Holyrood plant would be gradually put out of a job. But where is the egotistical glory in such a
boring simple solution?
Through their callous abuse of the facts, the
egoists forced a needless immense project into development whose net energy
cost to ratepayers will be many times that of Holyrood. It is a complete nightmare caused not by bad
luck but by extreme incompetence, arrogance, spite and recklessness. Their misguided endeavour resulting in a bill
that cannot be paid is certain to financially ruin this province and harm its
people for many decades to come.
Trump’s legacy of malfeasance will surely be in a class of its own but as to his methods, yeah, we know his kind all to pieces.
