Hard les­son

The Compass - - EDITORIAL -

In Oc­to­ber 2014, Ed Martin came to The Tele­gram for an ed­i­to­rial board meet­ing. By then, de­trac­tors were reg­u­larly de­nounc­ing any­thing com­ing out of the Nal­cor CEO’s mouth. As the found­ing head of the Crown en­ergy com­pany cre­ated by for­mer premier Danny Wil­liams, Martin has had his hand in a num­ber of things. But his great­est legacy is the Muskrat Falls hy­dro­elec­tric project.

To say it hasn’t been con­tro­ver­sial is to liken the Churchill River to a wad­ing pool.

Nal­cor ar­gued that string­ing power from a dam on the Lower Churchill across the strait to New­found­land was the cheap­est op­tion to ful­fil the prov­ince’s elec­tri­cal needs.

From the start, the num­bers were ques­tioned. Why was do­mes­tic power con­sump­tion ex­pected to rise so much? Why would any­one pre­dict a huge climb in oil prices, even­tu­ally ap­proach­ing $200 a bar­rel?

Once con­struc­tion costs started to rise — and oil prices changed dras­ti­cally — there was talk the project might be a huge white ele­phant.

Peo­ple ques­tioned the logic of sell­ing power at com­pet­i­tive low prices to the main­land while goug­ing con­sumers back home. Other speed bumps ap­peared. One bank of the river — the North Spur — needed se­ri­ous mit­i­ga­tion to en­sure the silty clay didn’t give way.

Que­bec went to court about its exclusive rights to Up­per Churchill power. The project was soon fraught with prob­lems.

Now the price has pretty well dou­bled and the end date keeps mov­ing. The writ­ing was on the wall when Fi­nance Min­is­ter Cathy Ben­nett took thinly veiled swipes at Nal­cor’s man­age­ment in this month’s bud­get. And last Wed­nes­day, Ed Martin stepped down.

It prob­a­bly wasn’t his in­ten­tion, given what he said to The Tele­gram back in 2014 when asked about his fu­ture.

“I be­lieve I have a re­spon­si­bil­ity to see some of th­ese things through,” he said.

Martin said some­thing else that day that was in­ter­est­ing.

“Per­son­ally, I’m in­dif­fer­ent as to what we’re build­ing here...,” he said, in jus­ti­fy­ing Muskrat Falls.

“It comes down to a num­ber ... and a de­ci­sion has to be made. And we made a de­ci­sion based on those pa­ram­e­ters.”

Martin is a busi­ness­man. Nal­cor is a busi­ness. The com­pany pre­sented its case and it was the govern­ment’s re­spon­si­bil­ity to poke and prod that case.

In­stead, it re­lied on cur­sory as­sess­ments by out­side con­sul­tants and froze out the prov­ince’s Pub­lic Util­ity Board. The govern­ments of Danny Wil­liams and Kathy Dun­derdale should have rep­re­sented the peo­ple’s best in­ter­ests.

In­stead, they were cheer­lead­ers for a project with a grow­ing price tag.

They, and cabi­net min­is­ters like Jerome Kennedy, thun­dered against queries raised by the op­po­si­tion and nu­mer­ous non-par­ti­san crit­ics.

This is pes­simism and par­ti­san­ship, they cried. We have the best ex­perts right here at home Don’t lis­ten to the neg­a­tive Nel­lies. Trust us.

That’s no way to scru­ti­nize a multi­bil­lion­dol­lar project. It is gov­er­nance with blin­ders on. We hope the cur­rent ad­min­is­tra­tion, and those that fol­low, learn from this ex­am­ple.

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