More Bafflegab on the Upper Churchill

In another recent ‘information dump’ the Minister of Natural Resources released a Paper entitled: “Upper Churchill: Can we wait until 2041?”   

Many critics of the Muskrat Falls development have advanced the view that the Government should not expose the small population of NL to high cost power and to the financial risk associated with the mega project; the idea is that our incremental power needs can be met from a variety of smaller, less risky sources, until the Upper Churchill Contract expires.

For at least a year, the Provincial Government has been attempting to dispel the idea that developing a portfolio small projects, under the “isolated island” option was a viable.  Your Uncle Gnarley scribe wrote an article on the subject entitled: Upper Churchill Contract: Inherent Uncertainty or Bafflegab.  When the Minister released the new documents, The Telegram on November 10, 2012, quoted him paraphrasing an opinion contained in the Paper.  Said the Minister:

“I know at one point I laboured under the illusion that as we waited for 2041 we would get free power, we would have unlimited power, but when you look at the corporate structure of CFLco it’s not that simple.

“It’s not going to be Hydro-Quebec simply agreeing that all power will be given to Newfoundland and Labrador.  Churchill Falls (Labrador) Corp. will still exist – its ownership split between Newfoundland Hydro (with 66 per cent stake) and Hydro Quebec (34 percent).  Whatever happens with Churchill Falls, the interest of Hydro Quebec simply can’t be ignored.

“There is no doubt that Newfoundland and Labrador will benefit in 2041 power, but it’s very difficult to envision what exactly will take place”.

It is difficult to contemplate that these are the comments of the Minister of Natural Resources, a lawyer and former a Minister of Justice.   

The Pursuit of Apathy

I was lying in my comfy chair listening to evening news.   The forecaster called it the ‘weather bomb’.  This was a term that my old friend Uncle Gnarley had initially despised, considering it yet another example of the vulgarization of the King’s English.  But one could not deny the effect it had in describing the events which he knew was going to unfold in the next 24 hours.  The Avalon Peninsula was going to be somewhat spared.  The low pressure system was moving in from Cape Breton, over the straight and was due to hit the long range mountains by noon tomorrow.    It had come up very quickly, and it was going to be the first winter storm of the season. 

The wind beating off the side of the house was hypnotic and I quickly started to dot off.  My slumber was quickly interrupted by a knock at the door.  Who the hell would be out in this type of weather, at this time at night?  As I opened the door it was there was the cantankerous old economist Uncle Gnarley himself.  Slapped over his shoulder was an old canvas kit bag.  I motioned for my friend to come in.

“What brings you up from the shore”

“Well Nav.. I have sensed that you are getting soft in your old age, and I brought you some provisions in the event that this storm matches the high expectations of Toni-Marie”.   He looked at me, the devious smile was clearly meant as a double entendre. 

He reached into the bag, and hauled out a bottle of Laphroaig  “the peat will keep us warm tonight Nav”.

UPPER CHURCHILL CONTRACT: “Inherent Uncertainty” or Just Bafflegab?

Note: This item, written by your Uncle Gnarley scribe, was first published in the Telegram August 11, 2012 and is posted here for Uncle Gnarley readers.

Newfoundlanders and Labradorians have a right to feel a sense of betrayal, that an energy strategy, already bought and paid for, focusing on expiry of the Upper Churchill Contract in 2041, has been rejected by the Williams/Dunderdale Administrations. 

The following is a direct quote from Nalcor’s Submission, to the PUB, in defense of its Muskrat Falls strategy:

 "There is inherent uncertainty around guaranteeing the availability of supply from Churchill Falls in 2041 because it is difficult to determine the environmental and policy frameworks that will be in place 30+ years out. There are other issues surrounding the CF asset with respect to HQ, as Nalcor is not the sole shareholder of the Churchill Falls operation".  

Efforts to either break Hydro Quebec’s stranglehold on the Upper Churchill and develop the Lower Churchill, formed significant policy initiatives not just of the Moores and Peckford Administrations. 

Those of Brian Tobin and Roger Grimes had a different strategy but each attempted to limit risk to the NL treasury by engaging Hydro Quebec.

Notwithstanding the failures which ensued, energy policy, since 1974, has been pursued with the certain knowledge that the Upper Churchill Contract, in 2041, expires. 

Indeed, in another time, another Premier, indelibly linked with the Contract, might be heard to say: “It is not a case of ‘maybe’ or ’if’ or ‘possibly’.  The Contract ‘unquestionably’, ‘unreservedly’, ‘unconditionally’, ‘absolutely’ expires in 2041”.

MUSKRAT FALLS: A BETTER OPTION EXAMINED (Part 4)

The strain was showing on Uncle Gnarley’s face as he fought to complete his oration on that “dreaded” Muskrat Falls project.  His declaration that the Province should kill the power generation plant at Muskrat completely and build only the transmission line now, was deemed by him, a ‘modest’ proposal. 

Though he had reservations, Gnarley made certain that I understood, even his ‘modest’ proposal contained a significant qualifier: Nalcor must purchase access to 250-350 MWs from Hydro Quebec.  Together with the balance of ‘recall’ power from the Upper Churchill, of about 80MWs, the cost of which is small, might, he suggested, “and I emphasize, might, justify such an expensive transmission link to the island”.

The proposal had its face saving elements which Gnarley knew would have to be offered.  Some politicians would ‘go down with the ship’, he suggested, rather than acknowledge they had made a grievous error in judgement. 

Though he was a skilled Economist and retired University Professor, Uncle Gnarley had spent many a summer plying the waters off Petty Harbour, as a fisherman.  For him, turbulence, breaking waves and an unforgiving coastline were acceptable risks, though measureable when prudently assessed.  Those who conjured up Muskrat Falls were landlubbers, he suggested, for whom even the crises in Greece barely served as a metaphor for peril. For Uncle Gnarley, Muskrat Falls, wore all the hallmarks of impending disaster.

 “Just a drop”, Nav, as I offered to re-fill his glass.  I wish to be clear about my conclusions.