Muskrat fails

There are simpler ways to say, “I don’t believe you.”

You could, for example, just say exactly that. But there’s something special about having your lawyer say it in a letter, using the particularly passive style that must be taught as a required course at law school.

First, a little background: Newfoundland and Labrador Hydro is currently jumping through the regulatory hoops needed to get permission from the province’s Public Utilities Board to spend an unanticipated extra $7,638,200 for maintenance at the Holyrood Thermal Generating Station (TGS).

The utility says it needs to spend the money to help the plant continue to operate effectively until March 2022 because of continued delays on the Muskrat Falls project.

As part of that process, the PUB involves interested parties like the consumer advocate, Newfoundland Power and the Island Industrial Customer (IIC) Group, which comprises the three biggest industrial power users on the island: Corner Brook Pulp and Paper, Vale Newfoundland and Labrador, and North Atlantic Refining.

At this point, all of the parties who chose to get back to the PUB on this particular $7 million in spending support the work being done.

But the industrial customers?

They want Hydro to submit to more oversight to ensure the projects get done in a timely way. (They put it more politely than that.)

“With respect, the IIC Group submit that more stringent monitoring is called for given the COVID-19 risks to completion, in particular as it appears that Hydro has apparently not developed any mitigation plans to address the non-completion of one or more of these capital projects. Notably … Hydro has highlighted the risk of potentially catastrophic impact to Unit 2 Turbine availability during the upcoming winter season and to the safety of Hydro personnel if the Unit 2 Turbine valve overhaul is not completed,” the group’s lawyer wrote to the PUB.

Oh, and back to that part about “we don’t believe you.”

Turns out, the IIC doesn’t seem to believe Muskrat Falls will be up and running by March 2022 anymore.

“(We) would simply note that there is reason to be skeptical, absent dramatic departures from past performance and experience, that the Muskrat Falls project assets will be performing the function of ‘a firm and dependable source on the Avalon Peninsula … to maintain the reliability of the transmission network,’ so as to allow for the decommissioning of the Holyrood TGS as baseload generation by March 2022,” the IIC’S legal counsel writes. “The unlikelihood (or at least the substantial risk to) March 2022 decommissioning should form the context for the future management and planning of the Holyrood TGS.”

Oh, and no lawyer’s letter is complete without a delightfully neutral signoff.

“We trust these comments will be found to be in order.”

Indeed.