Muskrat Falls problems already spelled out
The only complete and credible analysis of the Muskrat Falls project, as proposed by Nalcor, was delivered by a provincial-federal joint review panel that reported its findings in August of last year.
It is extraordinary that this report, which severely questions many of the project’s main elements, has been virtually ignored by both the Dunderdale and Harper administrations that commissioned it. In much the same way the provincial Public Utilities Board, which might be said to have a statutory duty to advise/rule on this project, has been effectively shunted aside as irrelevant and unimportant.
Most Newfoundlanders are probably unaware that the panel “did not accept” — its words — that developing the hydroelectric potential of the lower Churchill River is a “need.” Or that Nalcor’s analysis showing Muskrat as the best and least-cost way to meet domestic demand requirements was “inadequate.”
Therefore, the panel called for “a new, independent analysis based on economic, energy and environmental considerations” to address “domestic demand projections, conservation and demand management, alternate on-island energy sources, the role of power from Churchill Falls and Nalcor’s cost estimates and assumptions.”
Having to ask these questions and more besides demonstrates the gross inadequacy of the information provided by Nalcor in support of the project and its huge $6.2-billion expenditure requirement.
The panel also wanted the new independent analysis — which, if it were done, would be carried our by competent consultants completely divorced from Nalor and its contractors — to consider “the possible use of offshore gas as a fuel” for Holyrood, a huge issue where alternatives to Muskrat are concerned.
A detailed gas proposal that could reduce government borrowing to the tune of serveral billion dollars was advanced by Stephen Bruneau of Memorial University, but in the House of Assembly on March 29, it was rejected out of hand.
When Liberal Leader Dwight Ball recalled that in 2007 the government’s energy plan required that companies applying for offshore permits provide a “detailed landing-in-the-province option for natural gas,” and revealed that compressed gas experts (the Enersea company of Houston, Texas) were hired the same year to do a natural gas study, very surprisingly Natural Resources Minister Jerome Kennedy replied, “I am not aware of the study ...”
Are we to believe that perhaps it has been kept from the minister, thus impairing his ability to adequately deal with the file?
The provincial-federal panel called, as well, for cash flow projections for Muskrat Falls and an examination of the implications of the project for the province’s ratepayers and its regulatory systems. These are pressing matters.
Exactly how much money has the province put out, and will it be required to put out in future, for this project? How will this affect the province’s ability to meet all the various needs of our people and the public debt? What really will be the effect on electricity rates in Newfoundland and Labrador? Are the dark hints of energy shortfalls, brown-outs and black-outs, reality or merely fearmongering on the part of government ministers to help push the project through?
When the premier demands, as she did on the radio recently, “What’s wrong with Nalcor’s numbers ... somebody show us,” the findings of the joint review panel are her answer. It is high time that she acknowledged that fact and acted accordingly. William R. Callahan writes from