This is part II of a report
chronicling Ottawa’s role in the Muskrat Falls project as both enabler and
colluder with the Government of NL and Nalcor. It discusses numerous areas, albeit briefly, where the Feds ignored blatant holes in Nalcor’s business case for the project, each embodying the certainty of project failure. It also describes how they empowered Nova Scotia to control award of the Federal Loan Guarantee (FLG), failed to perform essential due diligence after the project was sanctioned and, inexplicable, failed to intervene as the project’s price tag doubled for reasons it had an obligation to all the taxpayers of Canada to understand.
(Continued from Part I)
of a (real) Water Management Agreement (WMA) between Nalcor and Hydro Quebec
(HQ) — an essential underpinning of feasibility. A WMA is necessary to
coordinate the flows on a river on which there are two or more plants. Properly, that is to say legally, established it would Nalcor to maximize power output from the Muskrat
facility by “banking” excess power with the Upper Churchill plant and drawing
it down at times of high demand.
signature necessary to confirm its agreement with the WMA. Why did the Feds issue
a loan guarantee when the hydro project lacked even the certainty of water?
is owned 34.2% by Hydro Quebec; the other 65.8% by Newfoundland and Labrador.
In spite of the Province’s majority ownership, CFLCo still enjoys limited
decision-making flexibility. The Company
operates under a shareholders’ agreement which requires a special majority
decision of the Board of Directors in certain matters, which included the plan
of water management. Hydro Quebec directed the CFLCo board not to support it,
giving rise to the PUB’s decision to impose the plan subject to the agreements then
in place, which included the Upper Churchill contract.
In spite of this conditional feature, Hydro Quebec maintained
that the WMA, and other plans by Nalcor to access energy produced by the Upper
Churchill, still impinged upon its rights under the Renewal Contract, causing
the legal challenge to be brought. As we
all know, the Quebec Superior Court upheld HQ’s position, as a result of which the
matter is now headed to the Supreme Court of Canada.
view unequivocally expressed on behalf of the 2041 Group of “naysayers” by
lawyer Bern Coffey, who later served as Clerk of the Executive Council. The
advantage of delaying the project to obtain such certainty should have been
obvious to anyone not conflicted. On this critical issue, the Feds chose to
The project estimates, described by an articulate albeit
“anonymous” Nalcor engineer as “falsified”, captured no interest in Ottawa
either. Possible malfeasance, when so much money was at stake, ought to have
triggered an immediate audit. But, again, Ottawa exhibited not the slightest
engineers to contribute to a Blog Post entitled: Engineers Break Silence on
Problems at Muskrat Falls. A guest post by renowned Canadian hydro engineer, James L. Gordon, who wrote Engineers’ Competence to Practice Questioned was just one more in a series of such Reports written for this Blog which, taken together, ought to have defeated both Government’s penchant for denial.
the Powerhouse, but was sent to the scrap yard and never completed. The cost? Reportedly $120 million.
monumental failure related to the faulty or “popped cable” which contained an arrant strand. From the factory floor to delivery, storage and erection,
Nalcor’s quality control processes failed to give the problem notice requiring
its removal, replacement and re-installation. Those failures represent hundreds
of millions of dollars in extra cost but even more than that they serve to magnify a group out
of their league.
reports from the Independent Engineer (IE) on the progress of construction. In
a 2016 email to David Vardy, NRCan stated:
site visit and factory visit reports, the Independent Engineer also provides
monthly draw confirmation certificates, as part of the process for releasing of
guaranteed debt to the project entities to be used for project costs.
There is no evidence available to confirm whether the IE performed its responsibility according to its Terms of Reference. We do know that the IE found that Nalcor’s contingency reserve for the project was too low and reported the issue to the Feds back in November, 2013. But there is no evidence that they thought it was important, placed appropriate demands on Nalcor, or ever asked the IE to do anything other than file the requisite reports. If the they could not see, from the very beginning, that Nalcor did not possess the skill-set needed to manage a megaproject, and great risk to the FLG thereby, we have evidence of either culpability or at best that there was a problem of sleep-walking.
IE confirm that the drawdown of FLG funds did not exceed the percentage
completion of the project. The oddity is that when the Province finally ran out
of money, the Feds stepped in with another $2.9 billion guarantee, leaving the
new CEO Stan Marshall to maintain the status quo as far as project management
is concerned, except to remove responsibility for the Labrador Island Link from
VP Gilbert Bennett. By any standard of
oversight, funneling more money into a money pit hardly constituted diligent oversight. Equally, Stan Marshall’s declaration at the outset, following CEO Ed Martin’s dismissal, that the project was a “boondoggle”, ought to have caused concern, given NL’s fiscal condition, that the FLG already represented sunk cost.
Related to this post:
Federal Complicity: The Untold Story of the Muskrat Falls Project (Part I)
Mistake the Intent of the FLG
NL is a tiny entity of 520,000 people; the population of a few Toronto
city blocks. Only a sponsor having far more sway than the bluster of former
Premier Danny Williams could have pushed a highly questionable megaproject
along. The truth is that, against such inherent risks in something so large and
ill-fitting for the NL economy — and after satisfying legal commitments to Nova
Scotia, Muskrat would enlarge NL’s power capacity by only 15%. On this basis, too, only vested interests
with real political power and access to control over release of the FLG could
have made such a deal happen.
provision of the FLG, though he was certainly well aware of the veto power given
Nova Scotia under the Term Sheet.
of the veto with a take-it-or-leave-it refrain as his plane headed for Goose
Bay in 2012 with the announcement of the award.
to accede to the FLG could not have come from this province. Danny Williams had
rendered the Tory-dominated Avalon Peninsula a poisoned chalice. The federal
election, which preceded the FLG commitment, gave Harper’s party not a single Newfoundland
would not come from the likes of Danny Williams, Kathy Dunderdale or Nalcor CEO
Ed Martin. Combined, they were no match for Federal Justice Minister Peter
McKay, the MP representing Nova Scotia.
McKay was at the height of his power during those pre-Muskrat
years, serving variously as Minister of Justice and Attorney General, Minister
of National Defense, Minister of Foreign Affairs, and co-architect of the
merger with Harper’s Canadian Alliance when he headed the Progressive
Conservative Party. McKay held real political clout. In the long-held tradition
of Canadian pork-barrelling, if there were billions of dollars of largesse to
be handed out, he would make sure that Nova Scotia got its share.
from Labrador, Peter Penashue, who, to be kind, held no capacity to assess
Williams’ project or the implications of the scheme McKay had divined. This
short-lived MP merely watched as NL agreed to terms that were commercially reprehensible.
Canada had made global commitments to reduce its carbon footprint. Muskrat was
a source of green energy (by Canadian standards). Nova Scotia would be able to
cheaply reduce its carbon footprint by reducing its dependence on dirty coal. NL
sought to replace Holyrood thermal generation. Only a few “naysayers” ever took
pains to show that Holyrood, because of a brief period of operation even during the winter months, was a
polluter in the minor leagues and that other options were available — all far
cheaper and carrying far less risk than Muskrat.
which shared almost no risk, one far too large even considering Nalcor’s unrealistically high demand projections (now modified), offered the
promise of “clean” energy and “nation-building” too. What could go wrong?
seems, did anyone at the Federal level. McKay simply turned his attention,
first, to making sure that Nova Scotia had the right deal. For him, roadblocks within the Federal Government’s domain could easily be managed. Besides NL could be counted on to pull out any stops locally.
the deal Nalcor had negotiated with Emera. NL’s equivalency of the PUB demanded one far better. Wrote
“JM”, one of the most insightful analysts in this Province on the Muskrat Falls
project and a frequent contributor to this Blog:
morning of that day, the Utility and Rates Board of Nova Scotia (UARB) rejected
Emera’s application for approval of the Maritime Link (ML) stating the deal had
to be sweetened by $700 million to $1.4 billion (Net Present Value); otherwise
the construction of the Link would fail as the lowest cost option for that
later surrendered to the entirely predictable demands of the UARB in a revised
offer called the “Energy Access Agreement” (EAA) which committed virtually all
Newfoundland and Labrador’s surplus power to that Province at a price set by
auction in the New England States. This
capitulation by Nalcor secured one of the pre-requisites for the Federal Loan
Guarantee. However, in doing so, Nalcor
precluded the future allocation of firm power and energy from Muskrat Falls
from use for new industrial requirements in Labrador. It also undermined an
early argument used to justify the project.”
agreement at any price and release the FLG, JM added this prophetic
stating that Nalcor did not even possess the wherewithal to negotiate a
basement selling price, matching the minimum value the UARB sought in its
analysis of Nova Scotia’s lowest cost option.
It is a critical error; one that will cost NL taxpayers dearly should
New England prices further deflate due to the continued expansion of the US
shale gas industry.
wonder that Nova Scotia opposition to the project has been silenced?”
in no position to refuse the UARB’s demand. It didn’t want to, anyway. Seemingly,
CEO Ed Martin and his juniors salivated at the thought of counting themselves
among the ‘big boys’ of the utility game. Nova Scotia’s demands were
facilitated with access to as high as 48% of Muskrat power — more if it
prefers. It held no responsibility for cost overruns. The original 20 for 20
deal (20% of the power for 20% equity) grew to a pale imitation of what was
originally “sold” to Newfoundlanders. Nova Scotia’s investment now represents
only 11% of project costs, other backstopping agreements in Emera’s favour
fortune in dealing with a group with access to billions of dollars, who had already
spent hundreds of millions in advance of sanction.
million investment in the Labrador Island Link (LIL). Emera’s record of growth
and success suggests they had to know the calibre of the folks heading the MF project and gambled that the Feds would not permit NL to default.
the project, even to enter arrangements that took the pricing mechanism for
export power out of NL’s control, is as difficult to understand today as it was
in 2012. But that issue is no more opaque than Nalcor’s assumptions regarding oil prices or native demand or, for that matter, the Feds’ willingness to
ignore how much power could be virtually given away to Nova Scotia with the balance headed for a declining export market, while they, and NL, kept up the
pretense of Muskrat’s feasibility.
Government of Canada Given SNC’s “Buried” Risk Report?
prepared for Nalcor. That’s the one which CEO Stan Marshall informs us
was buried; the one that warned of a “very high risk” of multibillion-dollar-sized
overruns; the one that the company states was presented to former CEO Ed Martin,
evidently having received it with clenched fist.
Government’s agent on the project?
corruption inquiry is, again, tired of light work and can be employed to ask some
tough questions, including some of the ones mentioned. “Under oath” does have a
certain ring, doesn’t it?
Nova Scotia, but Quebec and Ontario Benefitted From Muskrat, too
No one should think that all the benefits of the Muskrat Falls
project triggered by the FLG stayed in NL. “Projected Benefits to Canada,” according
to the tract which Nalcor gave the Feds in pursuit of the “enhanced loan
guarantee,” reminded them that beyond the 4.5 million tonne reduction of CO₂
already cited, the project would deliver $950 million in federal taxes. It
would represent $1.2 billion to labour and business in Ontario and $1.2
billion in Quebec. The project represented 18,000 person years of employment
in Quebec; over 8 years. That’s 2200 full time jobs. A similar estimate of
17,000 person years of employment went to Ontario.
provided only token resistance to the FLG.
It was not about the mines; likely someone realized that the 2200 jobs
created for Quebecers were real and that there might be future consideration, possibly even an Atlantic electricity corridor.
billions to Upper Canada. JM understood what unions, business and governments were too arrogant – or dumb – to take notice of, that the NL economy was already overheated: short on labour and
suffering severe wage inflation.
Related to this Post
Public needs to go to war first with Ball, then Feds
The culpability of the Government of Canada manifested in many ways: in matters financial, economic and environmental. Strangely, they exhibited no concern that Newfoundland’s Crown Corporation, Nalcor, was singularly unsuited to the task of building the project or that the assumptions on which it was predicated were, without exception, faulty. With blinkers on, it watched idly as risks to the Federal Loan Guarantee increasingly became apparent. Some may view such a comment as an invitation to
paternalism. But whether offered by a government or a lending institution,
when is a lack of adequate oversight on $5 billion or $7.9 billion not cavalier?
its interests; it was a condition precedent of the Term Sheet.
Otherwise, the economic
development context given the Loan Guarantee, like the presumption of its economic viability, was an “untruth” to which all, including the Feds and NL, wittingly agreed to be parties, even if irresponsible ones. That is the long and the short of it.
“write-off” of the Muskrat Falls’ debt is on the table, even if most people – and both Governments – are hiding under it.
Essentially, denial is all that left for the parties to this debacle. Eventually a bewildered public will force the Feds to own up, even if the Provincial Government, for the narrowest of partisan reasons, doesn’t want to. The real question that remains is this: if the Provincial Government won’t, is the public politically mature enough to insist that the conversation is held now, rather than wait for the troubles to pile up?
This graph sent chills down my spine. This project represents the greatest transfer of wealth from Newfoundland to Canada. Our oil royalties have been used to create 2200 jobs in Quebec over a 8 year period.
Let Ed Martin and Danny Williams explain that to my kids, who have to pay for this project with the doubling of their electrical rates!
Bring on the inquiry! But lets forget the Consumer Advocate, why not just let Gnarley, Vardy and JM cross examine Ed Martin. I would pay admission for that.
UG sums it all up,….. "the issue of the Muskrat debt is on the table, even if , most of the people, and both governments are hiding unde it". It was so blatant obvious years ago that Nova Scotia, and Peter McKay, had total control over the loan guarantee, we were just by standrs and the signature necessary to complete the deal. I will just add to the conversation of comments from last week, with regards to the percentage of the population that supported muskrat at the time of sanction. Some suggest the opinion poles were in the 70 percent range in support of muskrat, that may be so, but when compared to the actual numbers in the election before sanction, Dunderdale reduced the PC' s majority by 6 seats, and received 56 per cent of the popular vote. A far margin of 70 percent claimed in straw votes. The other two parties, received 25 and 19 percent of the popular vote, yet Dunderdale proclaimed it was a referendum on muskrat. If it were, it was a slim majority. Thanks. AJ.
Are the former PM and Minister of War on the Inquiry's witness list? If not, why not?
AJ @ 9:07:
I am not sure you have a good grasp on the history of the project:
You need to be referencing the 2007 General Election for general MF support-by 2011 the deal was effectively completed and construction was only about 12-16 months from starting. MF was announced as a go when it entered the EA process in 2006. There were issues other than MF in 2011 that reflected in waning PC support-ignore political spin.
Support for MF was upwards of 70% when construction started-in earnest and support for MF didn't start starting falling hard until 2015/2016 as issues became too mature to be mitigated by the remaining construction term and Nalcor/Government was compelled to admit there were failings.
"Support for MF was upwards of 70% when construction started-in earnest…"
The old mega project mentality that has gripped NL. A complete failure in development of our economy and we would sign on tomorrow if it meant creating a few thousand construction jobs.
PENG2, I suspect my grasp on muskrat history is just as great as yours, except I had no direct fincincial benifit and direct attachement in muskrat, except to see it not ago ahead as in the best interest of all NLers. I am just stating the fact, of the results of the 2011 election, before scantion, regardless of deals made and work done, which never should have happened before scantion. So I am just saying I prefer to put my confidence in the real numbers of an election, 56 to 44 percent, rather than poles, straw votes, that make a living at making public poling in favor of governing parties. And the premier, stated that, the 2011 was a referemund on muskrat, when asked why she didn't put muskrat to a referendum. So twist it any way you want, that's the numbers. Thanks, AJ
So called public support of Muskrat sanction occurred when there was no Energy Policy in place, based on objective consultation regarding cost benefits of alternatives. Warning; this could very well be facilitated and repeated by political action today. Ask yourselves how current Energy Policy will play out today?
"MF was announced as a go when it entered the EA process in 2006."
This is categorically false. Until 2010, when the "Muskrat First" plan was rolled out, the Lower Churchill project was a Gull-First scheme.
Anony @ 11:31:
Go do a review of the EA submissions-given that GI entered EA later than MF(Mf initially into EA in 2006) and the transmission assets tied to MF as approved in 2009 were undersized for GI, there is no doubt about intent-MF had to proceed first as proof of concept. Also worthwhile to review the government releases and press conferences of the day to gain an understand of what occurred.
Though I don't understand why you would think the order of GI vs Mf would make any difference-neither are feasible as proposed via the Anglo-Saxon route, could you explain that point?
Sanction/DG3(circa 2011) was a show of 'Pomp and Circumstance' aimed at maintaining a PC government with an unpopular leader until MF was far enough along to avoid cancellation; contracting and Emera deals were in progress 4-5yrs before then.
PENG2 ..you like spin, and pomp, I like facts. I expect Leblanc will be looking for facts, too. The project was awaiting the final approval of the FLG to be sanctioned. And it is only when you have the finances in place, the note from the Feds, that you can say the project is going ahead. Now Dannie el al can say a lot that may not be true, or factual. But, I realize that some had made a million before sanction, because maybe, we had put in a couple of billion of our own money before sanction. But that did not change the election numbers, of 2011, they are still 56 to 44 percent. Cheers. AJ.
Waldo (oh sorry AJ) – legitimate polling companies took the public pulse on the boondongle and until the last year or so, all polls indicated a majority were in favor.. in fact during the heyday of the FLG, over 70% supported.. your "facts" include negating all polling data.. get over it, until the last couple of years NL'ers loved the project
Hi again Waldo, your comments don't deserve a reply.
PENG2 at 11:59, the government releases of the day gave no public-facing indication of "Muskrat First" until the day of Danny's retirement-present to himself when the project was announced in November 2010.
As late as September of that year, talk was about Gull Island, with Muskrat Falls not mentioned at all.
The 2007 Energy Plan is a Gull-first document, with Muskrat demoted to pipe-dream status.
The "difference" is that Muskrat Falls first (and only!) is an even bigger financial and policy mistake than Gull-first. The last best chance to "develop" (hate that word) the so-called Lower Churchill (hate that name) was the Grimes plan that Danny and his cronies sabotaged.
I didn't make the "point" you are asking me to explain, so I won't.
Anony @ 13:07:
The public facing indications were somewhat masked in the documents showing the phasing of MF vs GI and the EA sequencing particularly for transmission. Even today if GI were 'sanctioned' tomorrow there is no way to get power out of Labrador.
You can verify this for yourself by looking for the construction tendering documents and the supply tenders-these documents pre-date sanction and in some cases the 2007 Energy Plan.
MF has been labelled Phase 1 for over 10yrs and GI Phase 2 with support facilities and transmission following. MF is proof of concept with the planned payoff coming with GI (if ever executed), nothing more.
PENG2, Can you summarize what was in the 2007 Energy Plan. Was there any reference to Alternate Energy plans for Avalon? Carrying charges for Muskrat suggest that up to $1B/year in Alternate plans might have been implemented, (Including Winston's Demand Management option), to defer Muskrat indefinitely.
Also enlighten us as to the current 2018 Energy Plan. What lessons learned, etc.?
The easiest plan would have been :
Build nothing, increase the rate at what is expected thanks to MF and the elasticity will do the job of reducing the need for power well below the actual capability of the insulated island.
As to what the plan is now, only the final answer about how the fiasco will be managed can tell…
Robert, the 2007 energy plan – which has never been updated or repudiated that I know – is available here:
"To ensure this project has every opportunity to move forward, the Provincial
Government is leading its development through the Energy Corporation. The
Energy Corporation has established a comprehensive and clearly-defined project
execution plan and will continue to advance the project on multiple fronts,
including engineering and the environmental assessment process, analysis of
market access options and market destinations, and a financing strategy. The
project is targeting sanction in 2009, with in-service of Gull Island in 2015."
Heracles, you say if the rate was increased to that expected due to MF that elasticity would take care of the matter, reducing energy use.
iIsuggest that robust energy efficiency to do away with baseboard heaters, plus added island hydro and wind, could have seen some slight increase in rates, but would have have kept yearly power bills stable or very close to stable, as the economics of efficiency saving on our high winter heat loads are so compelling.
Do you disagree?
The only point for which I do not agree 100% with you is that people will not do efficiency unless they are forced to do it. Quebec is a good example : we waste power at a maximum rate. Why ? Because it is too cheap…
The human nature being what it is, people would not have do efficiency just at the previous (still actual) rate. Only a much higher rate will push them beyong the tipping point to embrace efficiency.
Yes efficiency would have save enough energy, but efficiency will not be achieved without a rate increase high enough to force people to start to do it.
Always nice to talk with you,
Anony posted a link to the most recent Energy Plan I have seen-little more than a media piece and certainly not a policy paper; and not consistent with Government actions prior to or upto now.
A better measure of what the Government is planning would be by assessing the EA or other regulatory submitted documents and what they are negotiating with 3rd parties. GI was off the table before this came out, as was wind and other generation-Genergy and other proponents were refused the ability to even trial testing for multiple small hydro locations shortly after this time.
Heracles, lets see if you can agree with me close to 100% on this.
HQ rates ais about 7 cents per kwh ? At that low rate few will invest in energy efficiency
Here at 11 cents, HPs are going in at exponential rates without incentives. Already off the Avalon, in rural Nfld wood buring was reducing baseboard heat as the main heat supply, and now picking up on the Avalon.
But that alone does not do enough , as you suggest.
Separate Energy Corporations such as in NS, and many jurisdictions take a small amount of the revenue income form electricity sales to fund massive incentive programs . The good measures are cost effective, reduce the energy use and peak demand a lot. Without this the poor cannot afford it, and the middle class are slowed to come on board. In Nova Scotia they use about 50 millioin a year for this. In Nfld , about 5 million a year, of which only 1/3 is well spent. Take Charge is a sham, and does little.
Quebec does little for Energy Efficieny compared to many jurisdictions, with rates so low and plenty of electricity supply (including CF at 2/10 of a cent cost , can afford to permit wasting electricity. And being exposed to natural gas as competition for heat and hot water, you keep your electricity rates low.
NS knocks about 40 MW per year off with this approach.
Here , if doing the same , then 400MW reduction over 10 years.
So a move to get rid of obsolete inefficient technology,
A 1 cent add to power rates, 9.1 % brings in about 50 million year to fund the program. Of course hot water in second biggest user on the list to go after. This is a a "steady as she goes" approach, and savings to be verified with the measures, that they are sound measures.
You would ramp up, and maybe hit 50 million is year 3, and eventually ramp down as savings are achieved.
Incentives are typically 35 to 50 percent of the installed cost, and people will go for it like Chase the Ace, if you are familiar with that?
Of course, we are talking of what would have been best, instead of the boondoggle.
Hi again Winston,
About domestic rate from HQ :
It is 40 cents per day, fix cost
5.9 cent per kWh for the first block of 36 kwh per day * Nbr day in the month
9.1 kWh for any extra power
After a review of my invoice, the base rate cover 4/9 of my bill, the other 5/9 is charged as surplus. So that put an average price of 8 cents for that month.
Your average of 7 is probably right, but over a full year.
Biggest gain in efficiency is during winter time, so the 8 cents here is closer to reality.
By definition, all the power that will be saved would have been charged as surplus at 9 cents, so I think the evaluation must be done using that cost : 9 cents per kWh.
About the cost to produce power. Yes we do have CF at 0.2 cents, but remember the reason why we have it at that cost : It's because this is about the price we were able to produce it ourselves. All the hydro plants we built before and around CF also give us power produced at about this rate (well below 1 cent). So we do have CF, but we have much more and at similar price from our own hydro plants.
Hydro-Quebec does have some incentives to improve on efficiency, but with a power rate so low, the maths don't add up to any saving. Ex: in my condo, I have a defective window which lost most of its thermal resistence. I checked and to replace it would cost me few thousands $$. Never will I save that much in heating, so no, I can not change it on that basis. Ex2: We had a pipe in a garage that was freezing regularly. We hired a guy to re-do the insulation but mostly to protect the pipe. Over all, these 3.5K did helped me as my unit is right above the garage where we worked. But again, to re-insulate the garage was not an option from efficiency point of view. Only to protect the pipe and avoid pipe burst / water damage.
When the saving is so low, the cost of the solution has to drop way too low for it to justify the effort. The incentives help to reduce that price, but in Quebec, the cost of energy is just too low that no incentive can convince people.
For what is happening in Newfoundland, I think it is mostly because people expect the gigantic increase in power rate, so they get ready for that. They do their math with 17, 22 cents (or even more) and that's how they see the saving. Also, the climate you have I think is worst than ours : more cold, more humidity, so more heat costs for you. These factors start you from a higher price, so easier to justify efficiency.
As of now, my monthly invoice for HQ is about 115$. If 80% of it is heating, I pay 92$ per month for heat. Cutting that by 33% saves 31$ per month, or 1 $ per day. That is 365$ per year. For an option to be paid for within 5 years, it must not cost more than 1825$. Above that, I am better to pay for power.
The sole window in my master bedroom would cost a solid 3000$ to change. Doing all the windows and doors would cost probably 15K or more. To change them is even more important than switching from baseboard heat source, for both cost and comfort. Still, it would be way too expensive to do it at this rate.
Should I face an expected rate of 22 cents, my mind would be different. But I maintain that until the rate is increased (or expected to be increased) significantly, efficiency can not be the answer.
That's why, as for me, a standalone initiative for efficiency without increasing power rates would not work well enough. That's why I said increase the power rate to what MF promised (17, 22 cents), -THEN- an efficiency program will be adopted by a maximum, so will have its full effect. Without the increase in rate, people are used to what they pay, so they will just keep paying it.
Heracles, People here will marvel at your HQ bill average of just 115 per month with 92 dollars for electric heat.
What size is your condo?
Of course here with our say 11 rates and a HP I average 26 dollars per month for heat for 1000 sq ft.
You assume cutting heat cost by 33 % with efficiency and save 31 dollars, but for heat you should at least double that , 66 % ,( maybe not that much, see below as to MTL climate vs St . John's) and I am achieving about 75 % reduction, which makes a big difference to the economics.
You are mistaken to think our winters are colder. Our avg Jan or Feb nite temp in ST John's is -8.6 C , and day about +0.5C. So this make air source HPs much more efficient than for Montreal.
I know your have a lot of low cost hydro besides CF, maybe 35,000 MW with CF 5.4 MW of that.
Air source HP started ramping up here about 2009, well before MF sanction, and taking off now as people starting to realise high rates are coming. Heat is 60 % of our residential load , and much higher % in the winter months, so the economics with 66 % or more in savings on heat is tremendous. Not so much for Montral being colder , unless you go to ground source.
NS had much less electric heat than we do, yet they have installed at least 100,000 air source units in the past few years, and also gives AC in summer.
On overall yearly bill, if you add 9 % to pay for incentives, you save about 35-40 % on the yearly bill, so net saving 26-31 %, , so with power rates of 11 cents is very effective, and as rates rise , much more effective.
Yes , we have more humidity , but as it gets colder , there is less water content and the negative impact is less when colder than when milder at say +2c to -2 c, being worse for RH as I have monitored for this.
In a nutshell, we have an excellent climate , especially on the Avalon , for air source units. A consultant report for the power companies dated 2015 confirms the huge potential savings in energy.
Does this change your opinion for Nfld situation as to efficiency benefits?
I see that Montreal Jan temp is -14 c at night and -5 C day time, so much colder than here. And in recent years our winters are getting milder still, with south winds bringing warmer air, while in central Canada, and into the central USA , more Arctic air is going south in winter, have you noticed?
Montreal temp at night for 2018
Jan 5, -22C
Feb 3 , -19C
Mar 18, -15 C
I wished for cold weather here all winter and got a max low of -13.6. So we are sort of tropical!
My condo is 3 bedrooms / 2 bathrooms for about 1400 square feet. It was built in 2004 and the contractor did a terrible job about both insulation and vapor barrier. Both should be re-done for efficiency and comfort, but the cost would be too high. About the fact that 80% is heating, that is not a measurement; it is only a pure guess… Actually, because I do have a split unit for air conditioning and HP myself, heating is probably less than 80% but if you group heating and cooling, you probably reach that 80%.
Good for you if your climate is not as cold as here. The worst I experienced was in Chicoutimi at my father's place in january 201…… 2014 if I remember properly. The weather station at Bagotville airport recorded a temperature below the one at the North Pole!!!! It was -39 at Bagotville and -35 at the North Pole, without any wind factor!
About efficiency, I always agreed that it is a good thing. My point is that it is not a majority that will go after it unless they are pushed toward it by something like an increase in power rate. It all goes about freedom and how most people can not take a decision that benefit them. Until they are forced toward efficiency, they will not do it. The reason is that it is an investment, so requires a short term lost before the long term gain. Most people are so much after all kind of short term gains that they will not go after a short term lost, despite when it is a clear long term gain. Incentives and others are good, but most of people are stubborn to the max and will not go after any short term lost until they are forced to do it.
Enjoy the tropic 😉
I may add that I am alone… So the volume of hot water is the one for one person. Washer and Dryer are also only for one. Everything related to food and kitchen is even less than the average for one because I go eat outside so often…
I also have a wood burning fireplace that I use on the coldest days, so it surely cut a few dollars too.
Still, overall, our power is too cheap to be saved and the only benefit of reducing our peak usage is for HQ to export and sell more powr at max value. Outside of peaks, no point to save any power here…
Heracles31: I agree with you that higher rates or the prospect of higher rates is the bigger incentive to install HP here in NL. It was in my case as I installed a single zone MSHP last year. In hindsight I should've installed a dual zone which would've "taken care" of my downstairs area in which it is the only place in my house that I must maintain using BB heat. I am seriously considering another MSHP this year in anticipation of the impending rate increases. Winston is correct that the lower income residents of NL are not able to invest in HP technology. If Government had the foresight initially and sponsored the installation of MSHP we would not be in the dire situation we now find ourselves in. MF was not conceived and sanctioned because we had no alternatives—it was because of idiotic and blindfolded buffoonery of the DW/KD administrations,plain and simple, and we will pay the price for it.
Heracles, agree that most are reluctant to invest, but common sense does kick in, in that even without codes outside walls are now 2×6 instead of 2×4, all people insulate and use vapor barriers. For contractors many are exceeding codes, and NRC etc lag behind what contractors do on energy saving for new construction. I think much depends on the pay back period and life of equipment etc.
For HPs with 11 cent power payback is about 5.5 years here, and once paid for can save owner about 15,000.00 over life of unit, if power jumps to 22 cents, pay back is about 2.75 years and savings about 35,000.00
Incentives make a tipping point for those to move to efficiency, even at moderate power rates. Many juridictions doing this for a couple of decades. Big advantage is to delay or avoid more new generation plants, in addition to customer saving on power.
In Quebec, this will be slower to catch on due to very low electricity rates. I hope that the NE USA will gradually reduce gas consumption for electricity generation, buy more HQ electricity, rates will gradually increase and profits for HQ will increase in the future, and rates in Quebec will increase, and trigger efficiency , via incentives. These power saving can further be exported to the USA, or Maritime provinces. USA move to more renewable power should see this transition in coming years, I think.
Of course your suggestion that customers will not invest in energy efficiency is like what Nalcor Ed Martin said, so they avoided this approach as part of the Isolated option for power here. Key is incentives, cost effectiveness, and choice of best measures that save a lot with short pay back. LED lights do little for that. For power companies a roll back up to 2 percent a year on peak demand is not unusual. So for Nfld at 1800MW peak, could achieve 36MW a year reduction on peak. A new 100MW gas turbine purchased recently for over 100 Million plus fuel costs, could be offset in 3 years.
So many places doing this approach, that it is generally proven to be be one third the cost of any new generation supply cost.
Our climate, as you know now is rather good for that. We may hit -20C once in 20 years.
NS lists many units that have a COP in the range of 2-3 at -15C, and are in the forefront of good information for customers.
Basically HPs allow heating to be competitive with natural gas or close to it, and little global warning gas emissions if hydropower.
Labrador too , using CF power have cheap rates and much waste of power.
Heracles, some years ago, when New York needed cheap electricity, I thought the Americans offered QC an energy retrofit deal. Free up wasted energy on buildings such as you live in, in exchange for transmitting that "waste" to the South. What happened? Did cheap and cheerful building codes and low standard contracts win out with profits from condo sales just run down the river?
Winston, you gave yourself the reason why I consider power rate increase is required for people to go to efficiency. Without an increase, only common sense says you should do it. The thing is, common sense is all but common (just like you said about common wealth 🙂
Robert, I don't know what you are talking about here… HQ not only has surplus as of now, they had such surplus in the past years too. Actually, last fall, HQ had to spillage water from one of its reservoir (forgot which one…) because the low consumption translate in a lot of saving in these reservoirs and more rain than usual in that month pushed the reservoir beyond its limit. As such, we have plenty of power to sell to NY should they wish to have any, even without the benefits of an efficiency program.
About the need to increase the rate for power in Quebec, I agree. Rates are adjusted slightly every year, but they are still too low in my opinion. To keep aluminium and data centers (big consummer of electricity) running, they can keep their industrial rate. But for residential, too low is not much better than too high. To fix all the inefficiency tomorrow will cost a lot. Increasing power rate would help people to do it right first time.
Heracles, prior to MF sanction, if power rates were increased from 10 to 14 cent, and then 1 cent of that used for efficiency savings for customers, and 35 percent reduction is residential energy used , most from savings on heat, then this is equal to power at 9.1 cents.
As efficiency alone would not quickly enough close our Holyrood plant, modest island additional hydro and wind additions would, add some cost , likely equal to overall 15 to 20 percent on yearly bills. Instead we go for the boondoggle needing 100 percent increase, and not reliable, and no water agreement.
If an analysis starting from scratch, I feels yearly power bills would not have increase beyond 20 percent, though rates would be more increase than that. Does that make sense
Now we have the worse of all results and not easy to correct.
Heracles, So HQ and QC have an oversupply of cheap hydro. There is no incentive within QC to manage the oversupply. Power is wasted, while neighbouring provinces waste their own power while energy costs and debt interest payments stress out provincial budgets, (Ontario, NB, NS, PEI, NL). Considering the "Share formulae" basis of the Federation, does this not give you an opportunity to come up with a constructive proposition? I have in my limited capacity attempted to break down stupid bias and pride amongst my own peers, regarding sharing Canada's Crown Assets. Where are the good will Canadians hiding?
You can be sure that there is nothing that HQ would like more than selling our cheap power to neighbours. The thing is, it is them who refused to go that way.
NB and HQ were close of a deal about something like that. Unfortunately, it is NB who walked away from that.
HQ and CFLCo were close of a deal about developping the LC to power Newfoundland and more. Again, it is Newfoundland who refused to go that way.
With Ontatio, recently HQ entered in a significant deal but again, Ontario also chose to keep a significant capability of their own and they are working their nuclear plants.
So you can be sure that by all means we try to sell our surplus of low cost hydro power. Unfortunately, everyone around refused it, for different reasons…
Thanks, maybe the panic cabinet meeting today over the KM pipeline, will result in some consensus on the need for a National Energy Policy, Finally? Regrettably, Provincial minds can't seem to get to that desired point. Time is running out for a more progressive form of Federalism.
You are giving Peter Mackay far too much credit.
Harper thought this was his ticket towards destroying a few more ridings' status as "Liberal strongholds". That's all there was to it. Nothing more.
We also saw how Peter's "credit" played out with the Irving ship deal in Hfx. You seem to be in favour of such gratis.
Robert G. Holmes9 April 2018 at 11:14, I have no idea what you mean by that sentence or those words.
Remember Harper would stab himself over Duffy; laid his darling Nigel on the altar of sacrifice and was so benumbed by his political life (what do you mean they don't like me?) at the end that he was able to be played into a part in the Rob Ford Family Values Hour.
Never any doubt in my mind he played his trump cards solely to give NL a black eye; the chances of re-gaining any Liberal seats was not even in his playbook; what are 7 seats from Nowhere in any case?
He had a crumbling despotism to try and wriggle out from underneath and a well-developed fear of obscurity and dislike to live down for the future.
If he didn't do it purposefully and with malice aforethought, he was just another dumb-ass politician, confused and staggering, blundering about, doing whatever the new Nigels were telling him to do.
In either scenario, culpable.
What a great writer, this reads like a novel. It makes a good case for Nfld being duped by the Nfld elite, with collusion of Ottawa and Nova Scotia, with Quebec largely sitting on the side line, knowing full well of the end result, yet not complaining of picking up 1,2 billion and 2200 jobs from this project. Who could blame Quebec. They did oppose the Federal Loan quarantee, if only a feeble attempt that we not be given enough rope to hang ourselves.
Yet the anon comment at 08;19 calls out Quebec on their benefit but ignores the equal benefit to Ontario cited in this piece. This supports our Quebec commentators view that Quebec gets blamed for everything.
And the over 1 billion in tax to Ottawa is not chicken feed.
And that maybe 70 percent of Nflders supported MF project……..if they had been so informed of the web of deceit by the parties in this, as laid out here by UG, I doubt if there would have been such support by the public. Too many said Danny Williams is a smart man, he would not mislead us, would he! Blind trust, as we once had in priests who molested our children.
And Robert, Your reference to the Minister of War…… the Romans had a god for war, and for centuries, countries had a Minister of War, which in more recent times got renamed Minister of Defense. McKay, being Minister of Defense, in earlier days would be Minister of War.
Indeed, he should be on the witness list.
I have no idea what you mean by that sentence or those words.
The real story here is that Daniel actually sabotaged the Federal PC's in NL through ABC, so that there would be nobody of Mckay's stature from NL to stand in his and HQ's way of stealing CF down the road. Daniel and HQ played the long game!!!!
Another legacy of the former Minister;
how about those NL ferries?? I presume the Feds' actually float?
I'm confused. When UG suggests that "it won't slay the cries of paternalism" he means that paternalism is bad. But when he refers to the FG stopping NL from betting the house that this good paternalism? The difference between bad and good being that somebody else pays?
Site C/Muskrat similarities; Nikiforuk/Vardy
Uncle's concluding statement seems odd "If the answer is no, the alternative is to await the outrage"
on the one hand he has been suggesting that the NL public is docile and were duped by the Danny geniuses.. so why will they arise from their stupor to express outrage sometime in the future and then only at the FG?
but this really relates to a nativist self-centred victim hood viewpoint
The UG answer to the problem seems to be is for Emera swallow their investments and the FG to swallow the whole $7.9 billion loan. Thus leaving the province "whole", including CF, except for a big provincial debt.
Clever ideas those, but the real outrage over such a sweet heart deal would come from the remaining 33.5 million Canadians, who would view such a bailout of a self-inflicted provincial wound, as an absolutely travesty of natural justice.
I agree that payment must be paid. NL, however, better be ready to part with not only its crown jewels, CF at the top, but its ability to ever again undertake such a harebrained scheme. Bye bye sovereignty, hello Big Daddy.
Anonymous has the wrong take on that line and likely it ought to have been better phrased. I am suggesting this: if the province continues not to take seriously our impossible fiscal condition, one that will come into view fully after Muskrat is commissioned, the enormity of the problem and the fact that it was not dealt with much earlier, will cause great public outrage.
The outrage will come only after power rates pop up to shock rate. I suggested this about 2 years ago, that despite all the work of UG and others , the public is not tuned in. When it hits them in the pocket book, then the outrage will arrive.
At the Inquiry, was there a single ratepayer in the audience, other than lawyers and those looking for standing? You would think there would be lineups outside ………100,000 line up for Chase the Ace, but no line up, and most all vacant chairs for finding out Who Shot JR, I mean who bankrupted our province with this 12.7 billion of wasted money!
So we need to save 800 million a year to offset Muskrat.
1. 600 million from efficiency measures on our 3 billion a year spent on health care, whereby we spend more money with worse outcomes than other provinces.
2. Close MUN, and save 300 million a year.
These two saves 900 million a year, so problem solved, backruptsy avoided, and CF asset secure.
3. Poke Cathy Bennett in the eye with a sugar tax, on pop and junk food, how many million will that bring in, and improve health status of our population.
Is there not a defender of MUN…….
Does MUN give value for money spent….
Lets start with Wade Locke……and how that guy shaped our future.
The MUN-tery on the bottom of Signal Hill may not be a big spend in the scheme of things but it does look bad for President K. and his minions to be whinging about less money while re-building an old hotel in the wrong part of town for access to the main campus?
Will it be part of an extended Campus, requiring MUNCops, MUNMaintenance, MUNFacilities?
How many old age pension cheques will the MUN-tery require?
And, when the power bill goes up how much more for keeping the Mun-tery warm and cozy?
MUN can't be defended easily under any circumstance; it is hide-bound, archaic, regressive, and antiquated.
Wade Locke can't be defended at all!
Winston Adams: shutting down MUN would probably be a penny-wise and pound-foolish decision: if young Newfoundlanders need to leave their home province to pursue post-secondary education, it seems to me that this state of affairs would merely greatly accelerate the exodus of young Newfoundlanders, thereby worsening the economic situation, and ultimately costing your province far more money.
Indeed, conversely, MUN could serve as a major tool to reverse the demographic decline of NL, and not only by keeping NL students in NL: if students from other Canadian provinces could be attracted for their education, might it then be possible to aid/encourage at least some of these (former) students in settling for a life and career on The Rock?
That MUN has Bad Apples among faculty and incompetent managers is undeniable (All Universities -well, all complex institutions, really- do, actually: indeed, as someone who has worked at several North American Universities, I can tell you that the comic strip "Dilbert" is *very* popular in Academia…and I do not think this popularity is due to the quality of the artwork), but to the best of my knowledge there is no evidence that MUN is in any way worse than average.
I am open to the idea that shutting MUN may not be wise. But if the choice was necessary to save our share of the asset of CF, downsizing MUN may be wise: they keep on building while unable to do maintenance or energy efficiency upgrades on their existing buildings. And there is Wade Locke, the genius behind the great economics of MF
MUN seems to be to be controlled largely by Nalcor. And can we afford a campus in England!
I and Robert Holmes got degrees from outside Nfld, and I came back, and many more who could get work here.
Seems the art of publishing papers by academics seems costly, if the so called research has no value. What great discoveries or advances in science has been made by MUN.
If we face bankruptcy, can we afford to subsidize students whether from the Rock or outside, as we do now.
Early in my business career, MUN helped save my ass, to prove (for a modest fee) that a product was superior to that specified for a project, that being in 1979. Recently my request that MUN verify or peer review my testing on efficient heating systems met with no interest on their part. Such work seemed at odds with the myth of MF being needed and of value.
So, I think, MUN , a sort of make work project that we can no longer afford.
That you , Etienne, from Quebec, has to defend MUN, and no one from MUN has on this blog, must say something by their silence.
I would not support any move to balance the budget by taking it out of the MUN program. That the sprawling campus seems to have built forms which require re-engineered systems, the value of this institution to future generations must be held firm. I do believe in the concept that when overloaded with debt, a corporation and government must generate income, and sell assets, such as Muskrat, which seems to have no basis in the future to recover capital cost.
Of course , Robert, MF is of almost no asset value, and Heracles suggests trading the 12.7 billion debt for our 66 % ownership of CF.
To that we would have to think carefully of what we can do to reduce expenditures, and health care is a must, and roads etc, and MUN was questioned previously by UG blog
And where was all that wisdom and prudence from MUN is exposing the flaws of MF, or input to this blog? Lord Taylor , our first chancellor, I believe, put up in that fancy mansion, being a Lord and all, imported from England.
Our fishery in shambles since Joey's day,….and this historical our main industry, and MUN doing almost nothing in that field.
I am not impressed.
"Indeed, conversely, MUN could serve as a major tool to reverse the demographic decline of NL, and not only by keeping NL students in NL: if students from other Canadian provinces could be attracted for their education, might it then be possible to aid/encourage at least some of these (former) students in settling for a life and career on The Rock?"
Almost two decades worth of stupidly-low tuition at Memorial Diploma Mill of Newfoundland has failed to achieve this outcome.
The tuition freeze is bad public policy and even worse fiscal policy.
"AND THE PUB'S GOT NO BEER"…sad…..and may not get a license to buy or sell beer. An hydro electric plant that does not have water. And the Feds knew that and went ahead with its 8$ billion in loan guarantees. Just wanted to high light that point again, as UG has again pointed out. As I may have said before, the oldest trick in the book. In my boyhood of growing up, remember reading books in mid west America, of the cattle and live stock all dying downstream as the up stream rancher, cut of the water supply. Or if the water came, there might be poison in it so the same result. Dead cattle, and livestock. Did the guys in Ottawa not read those books, or yes, they did, and knew the result. Harper did for sure, not sure about Dannie. So now we await, but not holding any breath, that the SCC may rule in our favour or maybe some so called compromise, or totally against us. We won't be surprised, either way, unless they want to try and protect the Feds 8$ billion. Can't even cry in our beer, unless the pub gets a license. Cheers, AJ.
Who is removing the water downstream of the upper plant? All this massive amount of water must usually pass gull rapids and the muskrat plant downstream on its way to the ocean.
First, you have to realize that everything you blame the Feds not having see or detected, you blame yourself for not doing any better. Actually, because you were first line, your fault of not detecting it is even worst.
As for the judgement from Supreme Court, I do not understand why it takes forever, but I suggest you go and watch the audience from the Supreme Court website.
Justice Brown objected CFLCo on most of their arguments, telling them that when you go in a 65 years contract, you must do that knowing that the world will turn over a couple of time in the process (and much, much more!)
Justive Moldaver mentioned how remarkable it was for parties lawyered up beyond belief and making a contract as detailed as writing that a billion means a thousand of million and yet, they would have forgot about the most important clause in the contract saying about the kind of sharing CFLCo was asking for.
Justice Abella, at the very end, after CFLCo repeated that the contract was a partnership and not a simple contract of sale, asked if they should look at the object of the contract which says it is an agreement to purchase and sale.
Justice Cote explained to CFLCo that for all other sharing being explicitly mentioned in the contract, should not that be the evidence that all sharing was considered and detailed in the contract and as such, no other sharing should take place.
Justice Gascon and Wagner were not as direct in their objections, but just the kind of questions they asked CFLCo showed that they too were not impressed (You said your rights started in the 1980s, so why did you wait so long for your action ? ; For you, the duty of good faith forces you in some sort of duty of sharing ? )
All of that while HQ's arguments were received and approved like when Justice Brown confirmed the evidence provided by HQ proved that indeed, the parties anticipated changes in paradygm and define the contract accordingly to protect themselves against that. (CFLCo arguing that the change was impossible to anticipate and was not allocated under the contract…)
So clearly, no, there is no way CFLCo can obtain anything from that audience.
Hi Anon 11:33.
Nobody is taking the water from the river. The problem is that Muskrat Falls has basically no reservoir. Its reservoir is so small that it is as good as non-existent. For that, MF is running with the river.
Upper Churchill power plant does not release water on a regular pattern. During summer time, water flows from UC at only about 17% of its volume, to ensure the river and ecosystem in it are sustained. The consequence is during these months, MF can produce only 17% of its capacity.
The rest of the time, MF has no control on the amount of water it gonna receive from UF because Nalcor casted HQ out of MF. So HQ controls UC for its own need, without syncing with MF.
This lack of sync between UC and LC is why MF will be able to reliably produces only 17% of its nominal power. Anything above that will be irregular, uncontrolled, temporary, ..
Omg Hercules, I am tired of blaming ourselves, you have heard me do that dozens of time, I used the rope anology a few times plus many others, even said here. Dannie, didn't read the cattleman's book. Thanks for the web site and a quick summary of what they are saying in the courts. But Google, " the pubs got no beet" humerous song, I did. Cheers one up, lol. AJ.
Very good news to know that you are tired of blaming. It means you are ready to go to the next step and start looking for solutions. As you realzied, no points to blame anymore. Too late for that.
So now that the situation is what it is and now that you are done blaming, what would be the basis you can see as a solution ? As for me, I explained how HQ could take both UC and LC because together, they add to 0$. From that, they would have the expertise to recover what is recoverable from MF and also to provide power to Newfoundland and NS.
Any idea for a solution on your side ?
Glad you are done blaiming and to talk about solution will be much nicer, more constructive and more interesting.
Yes, Hercules, blaming can only go so far for so long, and then turned into arguments, guess some are putting forth their arguments now. But I think the final arguments will be made in the courts, down the road. And when all evidence is presented, the courts will make the final rulings, and most likely assign blame in a shared fashion. But, I have to repeat, myself, and say that the signatures to this agreement, are ns, emera, nalcor, nl, the Feds, and the lenders. So will have to see what the courts rule. Now of course there is another possible solution, and that is a political solution. But think Ottawa, would have to give a lot in that one. Now did you google the beer song yet?? Cheers, just taking my daily walk outside. AJ.
Hi again AJ,
I did searched for the song. I have to tell you that there was alcoholism in my family. As such, that pub with no beer does not look so bad for me. For many of the situations described in the song, these people are better without alcohol…
Thanks for expressing your idea of what could be the basis for a solution. I regret you refuse the potential help from Quebec but that is up to you. I consider not being part of the problem is not a reason to be excluded from the solution but up to you to think different.
Emera and NS are not in any real trouble… They can pay for the maritime link by providing Newfoundland with power instead of getting power from you. Also, the amount of money they invested is much lower and they have a stronger demography than Newfoundland. As such, I doubt they will / they can be much of a solution for your part of the problem.
As for a walk outside, I enjoyed that too. I walked the Camino de Santiago twice and here in Montreal, my regular circuit is about 15 Km, mostly in parks.
Hope you enjoyed your walk,
Ok, glad you looked up the song…as one needs to have many interest, and relax and sing along sometimes, as I am sure you do. Not sure what you meant by NS can provide us with power, hope you don't mean with coal, as that is only a few cents cheaper than oil that we use at holyrood. Maybe you meant HQ power through NB. But don't think we really need to import any power from that direction, we have lots of water and wind on the island for our merger needs. Would not be very expensive to develop the little we need. And we only use oil at holyrood for 3 or 4 months in the wintertime. And lots of homes are doing HPs so our demand will go down so will not have much need for oil at holyrood. Yes enjoy walking and a run, just to get my Cardia rate up, as I am not a runner now, but walk almost every day, regardless of weather unless pouring rain. But only walk for an hour or so. I walk up graded trails, well really the old NL railway track, with an up graded surface. And in winter time groomed just for walking or skiing, not down hill. But this winter so little snow, just like summer trail since January, but next year may be more like normal winters. Good you enjoy walks too. Thanks. AJ.
Will the Muskrat Inquiry be ongoingly covered and
reported on by the media as was the Cameron Inquiry?
The inquiry has its own website. You can review the audience about granting standing privileges and they will probably post everything on that site.
The URL is
Just want to make a comment, from the previous posting comments. An Annon: made a number of comments, but one stood out, ant it was something like this" the bailout started when Crosbie got the bailout for Hiberina" . Well in hindsight that was the best bail out or buy in ever by a government, or any company. For their 10 percent, I think it was they have reaped 10 fold and maybe a hundred fold, before it ends, but don't have the numbers before me. Wish we as a province, had the foresight and $$ to buy in at the time rather than the Feds, as with the proceeds rolling in from that equity steak, we would be able to do muskrat, and gull without any help from anyone, and buy the upper Churchill too. And when John said " I didn't take that goddam fish from the water", he meant personally, and he was correct. But what the fishermen meant, was the Feds had given it all away to foreigners, in exchange for European trade, and miss managed the quotas, conservation, and protection, that he as federal fisheries minister was now responsible for it and should hold up to his responsibilities, as should all his predecessors and now, those who followed as well. Just wanted to set the record straight, or at least show a balanced understanding of the facts. Thanks. AJ.
Why would you like to buy Upper Churchill when it is already yours ???
Yes, CFLCo owners 65percent, but as per current agreement, cannot make the decisions, that is held by the board of directors. Was making the point that the Feds has reaped Tons of $$ from Hiberina from their buy in, and continuing to do so. But as for UC you can fill me in, but not in terms of history, as I am quite familiar with that, just some of the current status. Thanks, Joe blow.
Anon 17:33 was just asking a question (a legitimate one)… He was not trying to fill you up with anything…
About the Feds getting a high return on their investment for Hibernia, I trust you on that one. Very possible and I have no details about that myself.
And about the control of CFLCo, you are probably referring to the Shareholder agreement by which major decisions require the approval of 75%, effectively giving a veto to HQ on these major points.
Just for you to know, HQ had two choices. One was to let CFLCo run out of money and use clause 12.2 to acquire a majority part of CFLCo.That way, they would not have more problems with CFLCo trying to disrupt the contract. At the end of the contract, HQ would keep its majority equity and so would continue to receive most of the benefit from UC.
Instead, HQ chose to preserve CFLCo's ownership by giving them free money. As a protection and to reduce the risk of CFLCo trying to disrupt the contract, they asked and received that veto.
So again, considering the options HQ had, I think they chose the one that best served CFLCo. It is not HQ's fault if CFLCo proved itself not trust worthy. CFLCo and Newfoundland went in court so many times trying to revoke the contract. CFLCo stole power from UC and sold it, forcing HQ to go to court for that to stop. HQ had to seek more control only because of that.
Should CFLCo and Newfoundland prove themselves trust worthy, things will me a million time easier for everyone!
That's fine Hercules, I was ok with an : 17:33 thought he would respond. My term fill me in, (fill me up)…. Just meant inform me, as you did. But I just asked not to give me a long, detailed history, but more like current status of UC. Yes, can see what you are saying about HQ CFLCo relationship, have not been keeping my self informed in last few years and all the court cases. But understand what you are saying. Thanks. AJ.
What's that glow in the sky to the northwest? Why it's a giant halo over Quebec as they wish to protect NL from ourselves… I say this in jest of course. I have friends in Quebec but none would be so bold as to continually stick their nose in and tell us what to do over and over and over. Heracles (and Etienne), you guys really need to take a couple of steps back and find a new hobbyhorse.
The only thing I'm grateful that you've shown us is that you may well be representative of educated Quebecers who are quite persuaded of their historical slant on Labrador and Churchill Falls. You're giving us a better idea of who we may be dealing with and we'll keep that in mind going forward.
This is not Quebec-hate – just feedback to inappropriate forum manners and not recognizing that you need to give it a rest. Please.
The postings on UG, including this one, have typically little focus on Quebec or HQ. There is a piece of history there, often misunderstood – personally I find the renewal clause of 2016-2041 to be by far the most egregious element and undoubtedly a causal factor of the Muskrat Mess. I hold this to be a Federal problem, and not a Quebec one. I imagine NL will negotiate exclusively with Ottawa going forward and the musings from Quebec would be better aimed across the Ottawa River than in this direction.
Hi Anon 21:45,
About Labrador, I consider the only reason why it would join Quebec would be if Newfoundland abandon its sovereignty. And about that, I do not consider it would be required or even constructive. So despite it would not be impossible for Labrador to be absorb by Quebec, I do not think it is something to put much time in.
About Churchill Falls, Quebec and HQ never asked for more than what is in the contract. As for the renewal, it was design as a solution to permit the project despite an increase in cost. Without it, there would have been no point for HQ to engage in the power contract.
HQ had no interest in buying power at a price higher than what it can produce locally. The only way for CFLCo to sell its power to HQ was to sell it at a lower price. That is what have been achieved by the power contract and its builtin extension…
HQ will have to be involved because they will be the only ones who can take the MF albatross from our necks.. that is the real genius of Daniel's scheme.. UC ends back in HQ hands forever because we built MF.. absolute genius!!
QUOTE: "I have friends in Quebec but none would be so bold as to continually stick their nose in and tell us what to do over and over and over"
The ONLY opinion I have given on this blog involves my opposition to the proposal that MUN be shut down (this thread, yesterday, at 19:17), for which I have tried to give some tangible arguments. If you have counter-arguments to offer, please, don't be shy.
Otherwise I have merely corrected a few factual mistakes made by posters here (including one about Newfoundland history recently) and asked various questions (many of which remain unanswered).
QUOTE "you may well be representative of educated Quebecers who are quite persuaded of their historical slant on Labrador and Churchill Falls. You're giving us a better idea of who we may be dealing with and we'll keep that in mind going forward."
I am an individual, not the borg-like mouthpiece of a hive mind, so if you think my comments are useful as a way of peering into the cackling, salivating, Sauron-like evilness of Quebec and/or Hydro-Quebec, well, you are in for a major disappointment.
QUOTE: "I imagine NL will negotiate exclusively with Ottawa going forward and the musings from Quebec would be better aimed across the Ottawa River than in this direction"
So: the federal government will, according to you, get involved. This means MF is an issue which concerns Canadian citizens other than Newfoundlanders. Does this not mean that I, as a non-Newfoundlander Canadian citizen, am entitled to examine the entire MF issue and discuss it with fellow Canadians -say, hypothetically, in the comments section of a blog for example?
Hercules: Thank you for the website link. Most of the Muskrat inquiry
will be webcast. Thank you again.
Just listening to Danny dumersque on open line talking about the fixed link, linking us to the mainland. He makes a lot of scense. But his main warning was, and I totally agree with him, "don't let governments go anywhere near it". Put it up for private enterprise proposal, and let them make bids. And using only their money. Yes and you may say are they going to fleece us to use when it is built. Well maybe only 40 bucks a crossing, similar to the Pei bridge, compare that to the ferry ride from NS. Plus if they fleece us to use it, then we won't use it and take the ferry routes we have now. The Feds have an obligation to provide the port aux basques ferry link under the terms of union. But guess if that service declines in use, then the cost will deminish and in time, may disappear although, but no doubt a long way down the road, if ever. And the study comes down today, but not request for proposals. Just my opinion, and rather skeptical. Thanks, Joe blow.
1.Did Leblanc say that those with standing was to have all documents and evidence filed with the Inquiry within 14 days, or did I hear it wrong
2 Leblanc said the Inquiry would hire their own experts.No one know who they will be or the process for their engagement. That the Consumer Advocate does not yet have standing as representatives of the people , and if he gets it, he may not get permission form Leblanc to hire expert witnesses,
3 MFCCC which has standing, seems not authorized to have expert witnesses costs paid by the Inquiry
So, does this process seem designed that Leblanc alone gets to chose experts and others do not,,,,,so all one sided for Leblanc……
Already the accounting firm Grant Thompson is on record as one of them was a MF drum beater.
Then too, the Queen , that is the crown has standing representing the present government, while at the same time , the prior government officials, Ministers and DW, all have standing and legal cost by the tax payer,…….so the crown past and present all fully lawyered up at tax payer expense.
Seems those that may get shafted by this process is the ordinary Joe tax payer, or ratepayer……and those who were the architect and enabler of this boondoggle will get some fancy stick handling by the slick lawyers that they get off scot free.
Or should we have blind faith in the jurist Leblanc…..
My 2 cents worth —- http://www.thetelegram.com/opinion/letter-at-the-muskrat-inquiry-for-whom-does-this-pipe-play-200090/
Pf @ 10:23:
1) Correct, the submitted documentation will be then be assessed as being relevant and whether there are related ATIPPA issues to settle.
2/3) Until the documentation is submitted to the Inquiry and issues of standing are finalized, your are being premature. At this point no one really has the ability to bring in experts as there is no documentation circulated to have an expert assess.
So you know the process is that when the documentation is circulated and all parties with standing have had a chance to analyze there will be another round of hearings to settle issues such as Experts, funding etc and then the Inquiry will actually start.
The process is why I stand by my comment that LeBLanc may/may not complete this by Q4 2019-it is a much bigger job than most realize it to be.
Very good letter M Adams, and I recommend UG readers see it.
In particular as to Dennis Browne, whether he fully represents the average ratepayer or will be wearing 2 hats, as if power rates are kept in check, then costs for MF will be shifted to taxpayers, including the well to do, like the enablers of this boondoggle.
Adams says that justice must not only be done, it must be seen to be done, and so far, there is indication of circling the wagons.
And it seems to be that Browne sits on the fence, as a Ball appointee,and Coffey, well he had to resign in disgrace working for and against the Ball government at the same time. Has the followers of the boondoggle short memory as to Coffey…….
So some of this pubic Inquiry rehearsed it seems, and then played out for the camera, with guilty look on some faces already, me thinks.
You can fool all of the people all the time seems at play here, as it has worked so well for generations, here on the ROCK
I would note also that sections 18 and 22 of the commissioner's March 14th interpretation of the TOR makes it clear that it is the terms of reference itself (not necessarily the commissioner's interpretation) that is legally enforceable by the Courts and that any misinterpretation could amount to a jurisdictional error.
The purpose of the recent hearing was not to ascertain whether applicants' agree, disagree or to otherwise assess the commissioner's March 14th interpretation, and applicant's for standing should not have been asked to confirm that they would abide by the commissioner's interpretation.
That amounts, it seems to me, to the commissioner attempting to improperly influence those applicants who do get standing from challenging the commissioner's interpretation (or potentially affect the commissioner's decision to grant standing)— and in effect unduly influencing what should be, as the inquiry proceeds, the legal right of those with standing to, or not to, exercise a legal right that they themselves have).
I think it was Aristotle that said that 'a good start is half the race'.
Well it seems that this inquiry is not off to a good and fair-minded start.
Just read Maurice's letter. Mentions a few important points. Maybe I am not totally in tune with the consumers advocate role and purpose. But my understanding is the role of the CA in the, or before the PUB is to represent only the rate payers, and not the tax payers. So are you now saying before the inquiry, he must also represent the tax payers as well as the rate payers?? I think his job before the inquiry, should be the same as his job before the PUB, and represent the rate payers only. And if as a result of his good representation of the ratepayers, the tax payers have to pay more, then not his problem, let someone else adovacate on behalf of the tax payer consumer. If I a, misunderstanding this then please let me know. Thanks. AJ.
You described why LeBlanc has concerns over the CAs participation pretty good there-generally it is the MHAs that represent taxpayers, and the CA rate payers. Definitely a nuance that is procedural based on definitions.
I would suggest that in quasi-judicial hearings (Labour Relations, EI, Revenue Canada etc) that agreeing that the Commissioner has jurisdiction and all parties participating agree with the ToR and his rulings is standard fair. Having said that, there would also be a dissenting opinion section appended to the final report covering such items of jurisdictional disputes by the parties the Commissioner cant/wont address such that readers can qualify the report.
You make a good point AJ.
It seemed to me that the discussion between the commissioner and the CA was about the CA being granted (by way of a special order in council) the authority to represent the interest of citizens generally, not just ratepayers —- but I stand to be corrected.
If what you say is the case, why was it that during the PUB 'least-cost' options analysis/hearing Nalcor objected numerous (I wound guess, perhaps hundreds) of times to issues, evidence and questions put forth by various parties by arguing that they were outside the terms of reference —- and the PUB invariably (almost always) ruled there and then that they were?
And during the DarkNL hearing, parties were given notice to argue for or against why evidence should or not be admitted?
Hard to do that if you already advised the commissioner that you agree with his interpretation.
Maurice, it seems that the die was cast by the ill-concocted NL Energy Plan, (2007?). We all bought the future Muskrat/Anglo route BS, towards the prosperity of Labrador power from as far back as 1949. When politics and emotion rule, as they have, regrettably since Smallwood marched us forward, objectivity regarding needs, and rational economics take the back seat. Without calling a witness, we can make the conclusion and Summary of the Inquiry right now. The future will follow the same unfortunate track, because the Energy Plan, just like the unresolved National Energy Policy is flawed, over-run by special interests, and raw emotion. (BC-AB crisis with Feds and constitutional law).
Difference is between Inquiry Scope vs evidentiary processes.
Disagreements on evidence are heard and ruled upon with reasons for/against in the report. Differences of opinion on scope are to be argued before government, with a dissenting opinion qualifier appended.
It has nothing to do with agreeing with the Commissioner on his interpretation, except that the parties agree on scope and limitations under the law. LeBlanc has already given opportunity for public input on scope, if there is still a dissenting opinion-now persons should forward to LeBlanc and copy Cabinet for clarification, keeping in mind he and LG in Council both reserve the right to expand/contract scope as required.
It is my recollection that many or perhaps even most all of the objections by Nalcor (during the PUB least-cost options hearing) were that the issue before the Board was outside the scope of the TOR. The PUB heard the objections and ruled (there were no differences of opinion on scope "argued before government" ).
Also, when LeBlanc asked for the public's interpretation of the TOR, if I recall correctly, he made it clear that he was asking for our interpretation of the TOR as written.
If all of this had nothing to do with 'agreeing with the Commissioner on his interpretation' ———– why did he find it useful to ask (at a hearing for standing no less), if the applicant would abide by his interpretation?
Too me ———– it smells.
Fair point, though I don't know the Statute under which the PUB hearings were held well. Most of the public comments I have seen shown little indepth understanding of the ToR, various affected statutes and Rules of Procedure the inquiry will be guided by-yours is pretty technical.
I would say though that under the Public Inquiries Act there is a set procedure to settle disputes of scope: LeBlanc is limited(he can only requesting the court with no right of appeal) while others like interveners, witnesses etc have wider abilities and can appeal to Cabinet or the Courts.
Scope cant be interpreted is the same way as evidence-I saw his question as asking if there were disputes over his jurisdiction, not necessarily how/what he will hear.
I am not yet willing to pass judgement until I see how scope is being applied, until then I think most of this is speculation.
I agree. Rules of evidence is different from scope (interpretation/limitations).
However, (and I would need to review the video/audio of the hearing), I don't think anyone was questioning his jurisdiction — it was supposedly to be merely a hearing for applicants to explain why they should be granted standing.
It was the commissioner who (on several occasions) made it clear that what some applicants wanted him to 'inquire' into was outside what he interpreted as within the TOR (and he outlined various reasons for his position such as time constraints, the need to focus on the MF business case, etc.).
Now that is all well and good, but that was not the time to then ask if the applicant would abide by his interpretation. That was not what the applicants were there for. If he was going to ask such questions, he should have given notice to them so that they could have been prepared for that.
If the rules of the game has been unfairly made and/or applied, the the team that wins has all but already been set.
So far, — a travesty of justice.
Is there really that much difference between the number of electricity ratepayers and the number of NL taxpayers? Are they not essentially the same people? Are we splitting hairs here?
Yes, of course they are the same people, the rate payer, the tax payer, the car buyer, and the church goyer, so what. But I will tell you what, I will pay your rate bill if you will pay my taxes. Of course there is a big distinction, between a rate payer and a tax payer. The poor guy may not pay much taxes, but may pay a Hugh rate bill. The six million dollar man, may pay a lot of taxes, but not much rate, as he may spend most of his time in Florida, and be able to afford to install 3 heat pumps. So not one and the same at all.
They are largely the same people, but how and what share of the Muskrat costs they must bare differs substantially based on whether or not they use electricity to heat their homes, and/or if the tax scheme is used to pay for Muskrat (or part thereof), then it is not so much of an issue about how much electricity they use, it is their income tax bracket and/or how they are affected by some other form of taxation.
I am not suggesting one over the other, but how the Muskrat costs are paid can be detrimental depending on whether you are a high electricity user or not, or if through taxation whether or not you are in a high tax bracket (or even if not, should the tax form be a straight 'levy' for example).
There can be a big difference as to whether full costs are based on electricity use or a portion paid for through taxation (if the CA is duty bound to look out for the ratepayer, can he at the same time protect the interest of the taxpayer?)
Yes, there is a difference between rate payer and tax payer.
Ex1: Usually, there is only one rate payer per house, because there is only 1 meter and 1 account. There can be multiple tax payers in that house, if both parents works.
Ex2: Some people have an income so low that they are exempt from taxes and do not pay any. As such, they are not tax payers. Still, they need electricty and they remain rate payers.
Ex3 : Charity organisms do not pay taxes. Neither does the government. As such, again, they are not tax payers. Still, they too consume electricity and as such, are rate payers.
Ex4: Some could generate revenu (so pay taxes) without consumming any electricity like the sale guy knocking at your door and trying to sell you his crap. So he would be a tax payer but not a rate payer.
So there is definitely a difference between rate payers and tax payers.
Lets face it, we cannot embarrass the Queen or her government or Lt Governor in these proceedings. Even M Adams letter in the Telegram is under the Nfld Coat of Arms. Is there 1 in 1000, or 1 in 50,000 who understand it`s meaning!
It was long thought to be issued by the London and Bristol Company to John Guy (a relative of Ray Guy, I wonder), I suppose because Guy actually made friendly trade with the Beothuk in Trinity Bay, about 1612.
Prowse actually said this in his history of 1893, and a Nfld stamp of 1910 shows this. The correction was not discovered until WW1, and the Coat of Arms became official in 1928.
From Dominion to colony (under the Commission of Govn,) to province in 1949), we have continued with this Coat of Arms.
Let`s examine it:
1. The Nfld herds of caribou is represented by an elk.
2. There are 2 unicorn and 2 lions, the lions are gold in color. These represent the royal beasts that support the arms of the Monarch. The lions represents England, and the unicorn represents Scotland.
Are you with me so far…….
Now the 2 Beothuk represents the indigenous population of Nfld.
The Motto: Quaerite prime Regnum Dei, is a quote from Matthew 6:33 from the Bible, `Seek ye first the Kindgom of God`
This Coat of Arms was first used not by John Guy, but by David Kirke, Governor of Nfld from 1638-1651, but faded into obscurity, until readopted in 1928.
Now the 2 Beothuk are garbed for war proper.
Notice the Christian cross at the center. The lion is crowned, the unicorn with a crown and chain.
The Beothuk are holding up the English shield of the cross , lions and unicorn.
So that is your history lesson for today fellow UG readers, and trust it is informative.
Now they say a picture is worth a thousand words.
Now we know the Beothuk were never defeated in battle, made no treaty, ate no elk, and never submitted to the English Lion.
They survived over 3 centuries, and the last few died from starvation, the last woman captured revealed a few details to Cormack, a Scottish man who thought to save them from extinction.
Should we ask if these people were treated in a Christian fashion……given the symbols of the Coat of Arms.
Does this symbol represent JUSTICE under the Crown……for the Beothuk, or of residents for today…..under Leblanc…….
M Adams says this Inquiry smells!
I say the Coat of Arms smells. Take it down, sir, please.
Wow!!!! We all need a great laugh, once in a while, and a quick history lesson. Too bad there were casualties and extenction of a race, otherwise we could be laughing for ever and ever, and do some changes to the coat or arms.
So, anon, if no casualties or extinction of a race, this bit of history would be a great laughing matter, why so?
Because there were casualties and extinction of a race, you think the Coat of Arms is alright and should remain unchanged?
You say Wow, with 4 exclamation points, so a big surprise to you it seems? Because it is so funny? Or so irrelevant to this Inquiry subject?
Bet that when ever you see TV, or online or Telegram coverage over the next 2 years, you will reflect on the meaning of this Coat of Arms?
Could UG post a nice color picture of the Coat of Arms for UG readers? My description does not do justice, but may help in understanding it's meaning. Maybe we should laugh less at this. Does any one now find this Coat of Arms offensive? Could it be I alone find it so?
Thanks PF, for your rant, if you had not signed PF I might have thought it was RM, (Rick) so was really laughing at your rant, which I have every right to do, as of course you have every right to rant. But because it represents a sad part of our history, then I cannot laugh at that part. And maybe you can redesign our coat of arms, as Pratt did with our new flag, a few years ago, which I think most of us are proud of now. So I look forward to the day when we will have a much more representive coat of arms. Can just imagine to, (laugh) some representive at buckiham palace, explaining to the colonials what the coat of arms really means, as a picture is worth a thousand words As you say. Their thousand words might be quite different from yours, but to be honest I agree more with your interpretation. You can't be too serious, you know, we all need a good laugh one in a while. And if someone laughs at your rant, what's wrong with that. Cheers, average Joe.