Progress Report from Muskrat Falls Concerned Citizens Coalition

Some people have been asking what is happening with the
Inquiry into the Muskrat Falls project. This is our first update. Next time, a
web site, which is under development, will be ready. Future updates will be
found there and that platform is expected to offer timely communication
throughout the period of the Inquiry. 
What’s Been Happening?
The Coalition was created to serve as an intervenor in the
Muskrat Falls Inquiry. Upon invitation of the Commissioner the group submitted
our interpretation of the TOR, as did a number of others. It can be found
here.  The goals of the Inquiry are set
out on the Inquiry Website, particularly in the Commissioner’s Interpretation
of his Terms of Reference (TOR) here

In the Annex below we quote some of the key paragraphs from
the Commissioner’s Interpretation focusing upon the business case (paragraph
29) for the project, its exemption from the Public Utilities Board (30),
government decisions and oversight (31), and project risks (41), including
risks to health, safety and the environment, with particular mention of the
North Spur and methylmercury contamination. 
Specific mention is made as well in paragraph 41 to the mysterious SNC
Lavalin risk management report which went missing for four years and which
spoke of significant unmitigated risks as late as April 2013.

David Vardy
Several months ago we met with legal counsel to the Commission
and made a presentation on the key issues surrounding Muskrat Falls. We also
provided the Commission with submissions, letters and articles we have written
regarding the Muskrat Falls project. 
We responded to the Inquiry’s invitation for groups and
individuals to apply for standing and for funding and attended the Hearing held
on April 6, 2018. 
The Commissioner accepted our application for standing and
agreed to recommend to government that funding be provided to allow the
Coalition to retain legal counsel. We learned that 22 applications for standing
had been received by the Commission.
In his decision of April 6, 2018, approving our application
for standing, the Commissioner wrote as follows:
All three
of the individual applicants on behalf of the entity to be incorporated have
been critics of the Muskrat Falls Project for some time. Mr. Penney is a
retired public servant who has served in many high level capacities in the
government’s public service. He is trained as a lawyer. Mr. Vardy has served as
Clerk of the Executive Council in the past as well as having senior positions
in other government agencies. He is an economist. Mr Sullivan is a former
executive assistant to Premier Frank Moores and Premier Brian Peckford. He is
President of the Sullivan Group of Companies and has been publishing the Uncle
Gnarley Blog since 2012 dealing with public policy in this Province, including
issues involving the Muskrat Falls Project. All three of these individuals have
maintained a significant public presence regarding the Muskrat Falls Project
and appear to represent the views of other people in the Province who have
concerns emanating from the sanction and construction of this Project. I am
satisfied that these three individuals have been writing and researching on
this Project for some time and, as a result, could if permitted, assist in the
conduct of this Inquiry as well as contributing to openness and fairness.
Subsequent to receiving Standing at the Inquiry the group
began a search for legal counsel. That may seem like an innocuous task.
However, it was necessary to find Counsel who was not in any way conflicted; a
challenge in a small community.
We can now confirm that Mr. Geoff Budden of the law firm of
Budden and Associates has now been appointed as the Coalition’s legal counsel.
The group has already begun a process of meetings to brief him on the
In addition, a Company incorporated under the Corporations
Act, under the name The Muskrat Falls Concerned Citizens Coalition Inc. (the
“Coalition”). The founding directors are Ronald G. Penney, Des
Sullivan and David Vardy.
The Coalition is working to develop a website for the purpose
of providing information to Coalition members and to the general public.
Ron Penney
While funding for the Coalition will be provided by
government, it will cover the cost of legal counsel only. Other expenses will
require private sector fund raising. For this purpose a Fundraising Committee
will be established.
The Coalition is also appraising the requirements to get ready
for the first phase of the Inquiry. The formation of a technical committee to
advise the Coalition and to assess documents made available by the Commission
will be among the first orders of business.
Other Committees will be formed later and Members sought who
possess a skill-set having a direct bearing on the issues under consideration
in each phase of the Inquiry.
 The Forensic Audit
The Commission has engaged the consulting firm of Grant
Thornton to undertake a forensic audit. The Coalition has requested that the
terms of reference for the audit be made public. The group has also asked what
other research, analysis and data collection have been instigated by the
Public funding will not be available for Intervenors to retain
technical experts or to undertake research. Instead all research will be
initiated and managed by the Commission. The Coalition intends to review the
Commission’s research program and make recommendations where gaps have been
identified. The Commission has indicated that all documents shared with
Intervenors must be kept confidential until released publicly by the Commission
to Have Three Phases
The hearings will take place in three phases. The first phase
will focus on pre-sanctioning decisions and will take place from September 17
to December 24, 2018.
The second will deal with project management and is scheduled
to run from February 4 to April 4 2019.
The third phase of the hearings will deal with policy issues
and the future of megaprojects. This phase will run from June 17 to July 12,
2019. Closing submissions will take place from July 29 to August 2, 2019. The
final report of the Commissioner is due December 31, 2019.
Reminder what the Inquiry is About
The Inquiry is expected to find out the reasons why such a
seriously flawed Muskrat Falls project received Sanction. It will examine if
the damage can be minimized, identify how the benefits of the project can be
maximized and make recommendations to government on how the public interest can
be advanced by changes in public policy.
Des Sullivan
The Coalition will assist the Inquiry find the truth around
all facets of project sanction, implementation, cost overruns and other issues
within the Commission’s scope.  
The Coalition will use the expertise of the founding members
and others who have volunteered their time and have knowledge of the Muskrat
Falls project as well as experience in public service and public policy.
The Coalition believes the Commission should take a holistic
approach, which recognizes that health and safety, environmental and social
impacts are no less important than engineering, financial and project
As already noted, the Coalition will appoint technical
committees in order to bring to bear information and technical advice to ensure
that the Commission has all the information it requires.
Information a Key Goal of the Coalition
The Coalition believes that the Commission has a
responsibility to ensure that the public is given all the information needed to
understand the full magnitude of the obligations and impact of Muskrat Falls.
To that end the Coalition will seek to have the many legal agreements
summarized and the complex financial details of the project explained in simple
language, removing jargon and technical terms.
The Coalition also believes that the Commission must test and
compare the practices and policies adopted in the planning phase of the
project, including the exemption of the project from the jurisdiction of the
PUB, with internationally accepted best practices. Similarly, we will seek to
have the financial management and project management practices adopted for the
project contrasted and compared with international best practices. We do need
to learn why the project has become such a public policy fiasco.
The Coalition believes in a balanced approach, one which
identifies the mistakes of the past as well as the future changes in policy and
practice needed to reduce the negative impact of the Muskrat Falls project.
Now that the Coalition has been incorporated and legal counsel
appointed, we expect that the period up to the final report of the Commission
will be a busy one. We encourage people who support our goal to join the
Coalition. When our new website becomes operational we expect to provide
regular updates on our work.
Ronald G. Penney, Des Sullivan and David Vardy
Excerpts from the Commissioner’s Interpretation:
Generally speaking, it is clear to me that the Order in Council, and
specifically section 4, is geared to focus the Commission’s work and mandate,
primarily at the least, on the business case put forward by Nalcor leading to
the official sanction of the Muskrat Falls Project by Government in December
2012 as well as the reasons why the costs of construction of the Project have
escalated from the initial estimates made. By business case, I mean
specifically the case advanced by Nalcor, and accepted by the Government, for
the need, financial viability, costs and benefits of the Muskrat Falls Project.
Really what is primarily being asked of the Commission is to explain what was
done by Nalcor and the Government of Newfoundland and Labrador to cause the Muskrat
Falls Project to be sanctioned, whether the analysis done by Nalcor and the
Government was reasonable considering best industry practice and why the
Project cost has escalated so significantly.
[30] Also
to be considered is why the Project was exempted from PUB scrutiny,
notwithstanding that ultimately a reference was made to the PUB to compare two
potential options for supplying power to the island part of the Province. Once
that assessment by the PUB was commenced, the Government decided it would not
give the PUB the extension of time that it requested to complete its work. To
assess the possible impact of the PUB exemption or lack of scrutiny of the
development, costs and operation of the Project, the Commission will be
investigating the full circumstances surrounding the PUB’s degree of
Based upon section 4( d), it will also be necessary for the Commission to
investigate the involvement of the Government in the Project prior to sanction
and whether it was fully informed and was made aware of any risks or problems
anticipated with the Project so as to assess whether it had “sufficient
and accurate  information upon which to
appropriately decide to permit the Project to proceed”. Once sanction was
given, the Commission of Inquiry must consider what measures the Government has
taken to oversee the Project. In doing so, the Commission is directed to focus
on governance arrangements and decision-making processes as related to the
Project. Such an examination will be a broad one and will have to include both
the prior governments as well as the present government for the Province.
While there is some overlap between the issues to be considered under terms
4(a) and 4(b), matters for consideration under 4(b) will include such things as
Nalcor’s ability to oversee and manage a project of the magnitude of the
Muskrat Falls Project, whether construction scheduling for the Project was
reasonable, whether the contractual arrangements with contractors,
subcontractors, consultants and others, including embedded contractors, were
appropriately entered into in accordance with industry best practice, whether
any reports or risk assessments were obtained by Nalcor, who they were shared
with and how they were responded to by Nalcor. One such report will be the SNC
Lavalin Report dated April 23, 2013 which will merit particular attention by
the Commission. As well, I must consider whether appropriate or proper
consideration was given and actions taken regarding potential risk to the
environment, human safety and property related to the stability of the North
Spur and methylmercury contamination. How these reports or assessments were
received by Nalcor and whether they were made available to the Board of Nalcor
as well as the Government will also be a part of the investigation to be
Des Sullivan
Des Sullivan
St. John's, Newfoundland and Labrador, Canada Uncle Gnarley is hosted by Des Sullivan, of St. John's. He is a businessman engaged over three decades in real estate management and development companies and in retail. He is currently a Director of Dorset Investments Limited and Donovan Holdings Limited. During his early career he served as Executive Assistant to Premier's Frank D. Moores (1975-1979) and Brian Peckford (1979-1985). He also served as a Part-Time Board Member on the Canada-Newfoundland Labrador Offshore Petroleum Board (C-NLOPB). Uncle Gnarley appears on the masthead representing serious and unambiguous positions on NL politics and public policy. Uncle Gnarley is a fiscal conservative possessing distinctly liberal values and a non-partisan persusasion. Those values and opinions underlie this writer's views on NL's politics, economy and society. Uncle Gnarley publishes Monday mornings and more often when events warrant.


Bill left public life shortly after the signing of the Atlantic Accord and became a member of the Court of Appeal until his retirement in 2003. During his time on the court he was involved in a number of successful appeals which overturned wrongful convictions, for which he was recognized by Innocence Canada. Bill had a special place in his heart for the underdog.

Churchill Falls Explainer (Coles Notes version)

If CFLCo is required to maximize its profit, then CFLCo should sell its electricity to the highest bidder(s) on the most advantageous terms available.


This is the most important set of negotiations we have engaged in since the Atlantic Accord and Hibernia. Despite being a small jurisdiction we proved to be smart and nimble enough to negotiate good deals on both. They have stood the test of time and have resulted in billions of dollars in royalties and created an industry which represents over a quarter of our economy. Will we prove to be smart and nimble enough to do the same with the Upper Churchill?


  1. Citizens choose coalition over party. This is the essence of democratic reform. Breaking down the walls of secrecy over public information and policy. Very well done, and thank you for your time and good sleuthing.

  2. One thing that should never happen again is the removal of the Public Utilities Board from overseeing any utilities-related project. As a quasi-judiciary institution, it should not be within government's ability to sideline it, just as it is not in government's power to sideline the court system.

    • The only way Wind Turbines would work in NL is if Muskrat Falls was never built but due to certain governmental stupidity, we can now or never develop this provinces vast wind resources.
      Just think about this scenario. Muskrat Falls was never built but private companies started selling small wind turbines and Nalcor put all of its resources into Larger 2 to 3 MW turbines. Using Money from the offshore, each household and business would have been given a onetime grant for 1) efficiency improvements or rather replacing furnaces and electric base board heaters with air to air or even better ground to air systems along with a separate grant for insulation improvements in existing homes. There are other areas but let’s not get to deep into the details. 2) a grant for buying small backyard wind mills and a second battery for purchasing a battery systems for storing the wind turbine generated electricity form the backyard wind turbines. The two go hand in hand and rather than implementing a ZNE ( Zero Net Energy) policy whereby the grid is over flooded with wind generated electricity at peak production times and relying on backup oil turbines when there is a lull in the wind, we would implement a FRE (Flexible Responsive Energy) where by the goal of the energy policy is not to enable households to sell electricity during peak production times but to enable each household to become fully energy self-sufficient to as high a percentage as possible with the grid as a backup. The battery system could be a combination of all three of Lithium ion batteries, heat batteries and conventional hot water tanks that store the electricity for later use and which store excess capcity as it is generated. 3) Nalcor would purchase, build, operate and sell electricity from larger turbines as well as store excess electricity in a combination of Pumped Hydro ( I believe Cat Arm Generating Station already has that capacity), Grid Battery Systems and Gravity Battery Systems.
      But due to the stupidity of elected officials we instead have a Boondoggle that we can’t afford, can’t pay for and probably won’t satisfy or total electrical needs.

    • No what is amazing is that there is nothing in the anom@18:16 post that wasn't discussed in public circles but was purposely shunned in public policy. I would have to add to that efficiency improvements to the Grid and existing Hydro dams.

  3. Quote from ANNEX, section 29 above:-

    "Really what is primarily being asked of the Commission is to explain what was done by Nalcor and the Government of Newfoundland and Labrador to cause the Muskrat Falls Project to be sanctioned, whether the analysis done by Nalcor and the Government was reasonable considering best industry practice and why the Project cost has escalated so significantly"

    I would submit that the decision to proceed with Muskrat Falls was a top-down one, and made prior to sanction.

    Most everything that followed was unsuitable/inappropriate rationale and political cover for an already made, top-down decision.

    This inquiry (by way of a specifically designed limited terms of reference) is for the purpose of maintaining the coverup of that unreasonable decision, and applying the low standard of "reasonableness" and "knowledge that was available at the time" is a way for the inquiry to hand governments and Nalcor a get-out-of-jail-free card.

    See also

    • "They" know, that we know, that "they" already know who/what are ultimately at fault for MF fiasco, but have arranged it so that "they" will never be blamed or have to take responsibility.

  4. It's great to see receive the first progress report of the coalition. Looking forward to the launch of the website. I hope to be able to contribute in some way to the coalitions success. Well done sirs.

  5. Eh wot? 330 embedded contractors remain on site, while the Ball group move to remove the cloud of secrecy regarding contract values, and Work scopes. Stan must be getting nervous about the possible effects of abandoned "contracts". Certainly a threat to "finish strong", yadda. Give us an update Stan; what is the estimate to complete, including allowance for disputes, claims, changes, commissioning and startup.

  6. Unless the perpetrators and powermongers who had significant control over the enablers of this historical disaster still in the making, are identified and held accountable, there will be no stopping others who want to spend other people's money for their own self interests. Imagine a society where criminals commit crimes and are told "not to do it again because it wasn't in the best interest of society" and sent on their merry way. Look at the money we would save—no lawyers fees ,no courts, no prisons and employment would explode in that there was an inexhaustible pit of public money available. We would have Galways established in Tilt Cove, St. Brendans, Change islands, Little Bay Islands,– — –.The possibilities are endless.Our economy would have everlasting sustainability as we would be told and our future was very bright as we hop along the yellow brick road.

  7. Pity the "winners" of the million dollar Dream Home. Unless they're already rich enough to pay that scary light bill when it comes. Doesn't look like it will sale fast either (" Conference Board of Canada says the ratio of listings to sales is probably at record levels – 4/1.")

  8. Oh my..,,
    The Telegrams Editorial (Better safe than sorry) shows the two poor Beothic warriors (were they ever warriors?) on our coat of arms, above the words Commission of Inquiry Respecting the Muskrat Falls Project.
    The piece stated that Judge Leblanc requested the law to be changed (the Court Security Act, so that he can have "sheriff's" officers there for security.
    I never much hear much about sheriffs in Nfld, but all the old American wild west shows had sheriffs, and even in the days of Robin Hood.
    Sheriffs in the West prevented mob violence, generally, and shot up the bad guys. In Nfld they generally serve court documents, I thought. Not sure if our sheriffs have badges like in the movies.
    The piece says they can use reasonable force to evict people. And expect to be searched.
    "Judicial forethought" says the editorial, as Muskrat falls is a "live" issue, and the Inquiry might be "a focal point for people who are frustrated with their inability to be heard and with the financial burden the project will bring to bear"
    What if they posted the coat of arms outside, instead of inside, with those savage armed Beothic warriors with bows, would that not keep unruly Nflers away?
    Oh my, poor old Andy Wells never had this problem at the Muskrat PUB hearings, and complained that so few tuned in, nowhere matching the TV soap operas.
    Did UG call for a revolution last year? If so, Violence was not what he had in mind, I'm pretty sure. And perhaps before September , the rate mitigation plan will have everyone pleased, and the Inquiry will be a boor.
    "Better safe than sorry"? Perhaps that should have been the attitude before foolishly embarking on Muskrat sanction, without proper evaluation, which would have put MF on ice, and and relieved Leblanc of concerns for security, or the need to spend 30 million to uncover the wrongs done?
    In foregone days, preparations would be made to send in a man-o- war ship. It says this law change will see little debate, then get royal assent, and be proclaimed as law. Who said the justice system moves at a snails pace?

    Winston Adams

    • Watch what you say from here on Winston. Soon, all dissenters who voice concerns at the Inquiry, and in the media, including right here on the "free press", will be referred to as "Radicals and or Terrorists". We are going through that here in BC, as dissenters to the Fed give away on resources, and subsidizing the petro-chem masters, are similarly branded.

  9. I suppose it is a sign of the times, and I may have previously said , 2018 looks to be an interesting year.
    Is is telling when we start to lose faith in our justice system, and someone on this blog recently suggested the justice system is part of the enablers of the MF fiasco.
    But consider these comments about a judicial decision:

    If the law was never an ass before, Gillian Butler gave it two sculpted cheeks and a well defined crack. In her outstandingly twisted and entirely ludicrous judgement in the Sunshine List case, Butler turned out the lights on disclosure of precisely the sort of information contained in the original embedded contractor information requests. Those words by Ed Hollett in his blog.
    Hollett says the Bill 19 to change, (to become law next week), on the Energy Corp Act, still allows Nalcor to hold back information of the grounds of being commercially sensitive.
    Hollett says "and Butler's judicial brain fart remains the law until a higher court overturns it or the legislature passes a a law that says " Gillian Butler's nuttiness notwithstanding " this information will be made public.
    Hollett further says that the Premier or any minister of the Crown could have released all the information based on their own Crown Prerogative, since that Prerogative is not subject to judicial review.
    So, are we the public being manipulated by our government and justice system. Is Hollett right? Is the law an ass? If it looks like duck……
    Winston Adams

    • Winston:

      So how will comparing monies paid to a Nalcor employee vs a professional services contractor be accomplished? $100k salary to a Nalcor employee wont be the same as $100k paid to a contractor because of payroll and indirect burdens(perhaps upwards of 60% of salary) for the direct hire. Also, how will monies paid to a contractor from a recruiting company be compared to support farmed from an engineering company (Stantec, AMEC, Tiller, SNC etc)-both might have similar invoiced rates but monies paid to the individual will differ.

      I agree the info should be available, but the way it is being rolled out is typical voter pandering by the Liberals to the less informed majority. Unfortunately, most of the population either wont have the knowledge to do a proper comparison or wont care to understand what renumeration means or entails. Combine this with a lack of defining renumeration, time frame, contract terms etc the pending info release is of little value as proposed.

      In any event, I expect it will be shown that it was most cost efficient to employ contractors vs direct hires-if a proper analysis is done.

    • Anon, Will Stan have a personnel file for each embedded contractor with overall performance ratings, and remuneration rates for the Grant Thornton team? Were there any contract dismissals on record? Contract administration issues for consideration. Show us the performance review matrix. I would agree that the main issue does not go away with salaries and contract values comparisons.

    • Robert:

      I have no idea if personnel files exists-I doubt if a personnel file typical of most larger organizations exists though, and there were dismissals/non-renewed contracts for performance reasons. The performance review matrix (ie org chart) and base rates ranges for employee classes etc has already been released 2 yrs ago, granted not updated since.

      For what Grant Thorton has-they would have the base rate invoiced to Nalcor for each contractor and totals under each contract, and then depending on the source of the contractor they would have varying amounts of info, they don't necessarily have the wage of each contractor. For contractors sourced from engineering companies (~20%), Nalcor wouldn't have much info except what the base rate was; for contractors sourced from recruiting companies (~70%), the info Nalcor has would vary depending on the recruiting company and the persons relationship with the recruiter, the contractors status with the recruiter (employee, sole, fixed term, how often they worked together, recruiter-contractor perks etc). Then there are the Nalcor employees (~10%) that Nalcor would have full details on.

      I am not sure how government could compel the contractor to provide the info-salaries/wages paid by recruiters/engineering companies wouldn't be subject to Atippa, only the base/unit charge rates would be and that would be the same as for other government contracts—any contractor doing work for the government would provide unit rates, but not the actual wages paid to the employee.

      I just don't understand how knowing what a specific contracted Manager billed at (say $1500/day as per Atippa releases, I will ignore the claims of $250/hr as they are blatantly false) will help the comparison to a specific Manager under the Nalcor Hay plan (say equivalent of Hay Level 17 at $180k/yr for 1850hrs exclusive of burdens). I think the way the proposed info release seems to be going will cause more confusion than there is now-what needs to come out is numbers such that a $ vs $ comparison can be done on—and I did hear Paul Lane last week claiming there was a contractor working 16hrs/day for 365days, this is also nonsense. So we all know the math, 3200hrs/yr is a 21-7 schedule at 13hrs/day, pretty normal in construction.

  10. Pam Frampton's piece in the Telegram (Muskrat falls is dead ahead and we're headed to the brink), promotes an all party committee to protect the people and the province from financial ruin, to tackle rate mitigation. "Without some kind of cushion, electricity rates will roughly double by the time Muskrat falls comes online in two years or so, and keep rising….will you be able to find the extra $300 or $400 a month during our cold winters to keep your house warm? The governments offer of low interest loans so you can borrow money to buy a heat pump or a few extra batts of insulation is frankly, cold comfort-pardon the pun. The last thing anyone need as electricity rates continue to rise is more household debt" says Pam.
    Is that a good assumption by Pam?
    1. Define low interest loans. Here the interest rate charged used to be about 7 percent , but dropped to about 5 percent. Even so, in NS the rates were zero percent or incentives of 1500.00 and much higher incentives in Ontario. Here at 5 percent, what you save is most all retained in interest charges by Nfld Power.
    2. The govn program of 1 million dollars covered not much more than 100 houses, where we have about 170,000 house.
    3 . The model criteria for heat pumps promoted here is substandard, and will save little in the cold winter months .
    So in all, Pam is right , it is cold comfort to those needing to pay an extra 300 or 400 a month in winter.

    Is some household debt for that the last thing we need, or a good investment ( while not solving the MF fiasco)…….if one can achieve a heat bill of only 50 to 70 dollars in winter for 1000 sq ft?
    In 2011 NS must have pumped 30 million into such units to aid residents on their heat bills.
    To go to warm conform from cold comfort, first Mfld Power must promote "cold climate" units for the residential systems, and also good incentives or zero interest rates. Can a all party committee agree to that, and expose the rot that is TAKE CHARGE, with a real Efficiency NL Corporation, to bypass the conflict of interest of interest by the power companies? Doubtful. So the people and the province will not be protected, even if rates are mitigated to 17 cents. Low power rates and or good heatpumps and more insulation can give "warm comfort", and can help mitigate the financial ruin.
    What happened to the swarm idea?
    Winston Adams

    • Hi Winston,

      As I explained to you in a previous post, you math is right but your logic is wrong. The economy you talk about for a single user is right, but if this is replicated to a majority, the logic fail because Newfoundland MUST pay for MF. If you lower your power bill too much, either they will have to rise it back with higher rate, or to take the money from your pocket but over a different channel.

      It too late for power efficiency. One clause of the loan guarantee is that Newfoundland will adjust its rate for power at whatever is required to collect the money needed to pay the loan. With that, a single guy can benefit from efficiency and let most others pay for him. But not everyone can do that because if everyone do it, the rate will go up, with other taxes.

      MF must be paid for and because Newfoundland chose to keep all the risks on its shoulders, in the hope of getting all the benefits, Newfoundland ends up the one to pay for it.

      Again, it is WAY too late for power efficiency…

    • Heracles,It is not too late for power efficiency, and my logic understands the relationship that the project needs to be paid for. But the difference is whether by power rates or other taxes, or some combination. There is a point of diminishing returns for hiking rates, meaning other taxes or remedies needed.
      To adjust rates to whatever is needed , as you say , just near totally destroys the economy, so they will aim for likey about 17 cents as a compromise, on par with NS. But NS is much less dependent on baseboarrd electric heat .
      But 17 cents is too high to avoid heatpumps and wood conversions I suggest . And the optimum power rate depends on the efficiency of heatpumps and cost effectiveness, as this really determined the elasticity of electricity. If Hp savings is 40% 65% or 75 % , gives a different incentive to convert, and also the COP at cold conditions determines the amount of standby power needed, and fuel nee needed at times, as high Hp COP reduce the peak load, and can permit more exports to NS.
      So the power companies here now promote low grade units, hoping customers will avoid conversions and keep revenues up. They count on the ignorance of customers of cold climate units for high efficiency.
      You are correct that power efficiency should have been done prior to and instead of MFs, but as explained above, they can only delay the rate of uptake of the HPs and other measures, not prevent it. It is human nature to save money and elasticity effect will dominate, I submit. The uptake will be exponential to the power rate. Dave Vardy agrees with the elasticity effect, Wade Locke largely ignored it, and didn't want to know of effective alternatives. James Feehan is trying to suggest an optimum rate, I suspect. Personally I think anything over 12 to 12.5 cents will see a steep decline in power use.
      So government spending reductions must be a part of the solutions, as well as tax increases.

    • Hi again Winston,

      Why do you try to increase your export of electricity when every single KwH you produce increase your deficit ? No matter is that KwH consummed localy or transmitted to NS or anywhere else. As of now, you insist to pay about 17 cents per KwH for you to collect 3. In this context, if you don't need to power for your own need, better not to produce it at all. That's why there is no point saving power, so no point in efficiency.

      As of now, UC power is sold by CFLCo at about 3 cents per KwH, netting about 1 cent. That power costs much less to produce and much less to transport. To produce power at MF is estimated way above twice that price (ie : way above 6 cents per KwH) and its transport cost is also estimated to be way above twice what HQ charges for wheeling over Qc.

      The other reason why there is no point in saving is because MF can produce only at about 17%, so can barely provide the minimum due to Emera. Whatever extra power will be unpredictable and uncontrolable, all of that in an over-saturated market. As such, it is almost impossible to sell it. Even should you manage to save some power, it will be unreliable and basically impossible to sell that power.

      The question is can you pay an extra 400$ per month and receive nothing in exchange ? It does not matter if these 400$ are from power bill, taxes or any combination of these. If the government try to get these 400$ from you using the power bill and you found a way to avoid it, they will catch you in a different way. So why should you pay a few thousands to avoir being collected 400$ a month when you know that the government will come back over another channel and end up with these 400$ ? Better to pay just the 400$ instead of 400$ + Whatever the price tag of that heat pump.

      Yes, the way the guarantees are defined means a guaranteed destruction of Newfoundland's economy. Still, Newfoundland chose to go that way. To do differently will require a bailout with its own terms and conditions.

    • Here's what i intend to do; When Muskrat hits us, I will crank up the heaters and have it nice and warm. The $1000.00/month bill may break me but i'll be warm as opposed to being cold with my $400.00/month bill and coming for the $600.00 "savings" in a new "Muskrat Levy". Remember, they can't steal the same dollar twice.

    • Heracles, I say the HP reduction of energy use on the island means more available to ship to NS, only in the context that we have contacts that we are told must be filled with our island energy. (Cabot Martin says this could be broken , maybe)
      My preference is that MF be put on ICE as UG suggested 2 years ago, and since then, and even now with 9.2 billion spent, and likely to go to 15, means close to 6 billion more to throw away on the boondoggle, that can't even pay the operating costs.
      So if no MF power , or if very little as you suggest, that reduction of demand on the island is essential even for our own needs, or keep Holyrood running much of the winter.
      If MF don't operate and we get some recall power coming to the island, it helps a little but not enough for NS and ourselves, so power use reduction here is essential. The opposite view is that we get some 800 MW coming over the DC line in winter, if it goes as originally planned, (which is unlikely), and that satisfies the island and NS contracts and almost no need for Holyrood. That needs 23 cent rates, which destroys the economy, or 17 cent (plus other taxes or spending reductions) hoping elasticity effect don't drive down consumption to reduce revenue.
      Levy Payer may say he will crank up his heat to spend 1000 a month even if it breaks him. That is what Nalcor and the govn expects people to do, to suck up those rates, and when you are broke, or near it, your power gets disconnected, and you are no longer warm. So Levy will indeed spend 4000 to install a HP, and not go broke and stay warm. If Levy is not rich , any LEVY tax will hit him less. The existing levy taxes are much higher on the high earners, and that is how it should be. If need be Nfld would have to sell assets as you say, or roll over the CF contract for a decade or two, but first should come reduced spending by our government (rationalization private business might call it) Or , we could keep borrowing and go bankrupt,our current path. Maybe some wonderful deal will happen with HQ powering all of the Atlantic provinces, and they take over running the power assets…..but not aware of efforts in that direction.

    • After reading these exchanges I looked at my crystal ball and it showed me the future. Taxes will indeed be raised on everyone to pay for Muskrat, as will the power rates. But look for a provincial power bill tax credit to be offered, one claimant per household. Government will be desperate to offer taxpayers a little sugar for their bitter tea and this is a possible solution. See Ontario for the proof!

      With a tax credit, those who reduce electricity consumption will get less tax incentive rebate while generous energy consumers like Levy Payer will get some extra money back. In total, everyone must chip in and pay substantially more in the future, it's just a question of degree and depends on where you might fall in the future tax scheme.

      The way tax credits typically work, they appear more useful than they actually are so I'll choose the heat pump as it's the only practical alternative for my city house and I expect I'll pay less combined power and tax cost than if I don't.

      The reality is not everyone will do this and the more that don't makes it better for me if it lessens future rate increases. Nonetheless, any talk of saying individuals should not reduce their electricity usage for the greater good is ridiculous. Self-interest is far too strong a motivator and completely rational. The notion that people would not change their consumption, is entirely irrational.

  11. There is not much point for taxpayers to spend their own after tax money to purchase heat pumps and other energy saving items such as extra insulation when the government will have to take more money from another of the same taxpayer's pockets to pay for rate mitigation. Some mitigation money could of course come of reduced public services such as health care and education.

    • The longer-term costs of installing heat pumps to offset doubled electricity bills and increased taxes for rate mitigation will likely be greater than the costs of relocating to provinces that can deliver competent, democratic governance at lower rates of taxation.

      Consider that when you're planning for your retirement.

    • There is no offset when NL Hydro has a take or pay contract for all of the power and energy that Muskrat delivers. What you don't pay through rates you will have to pay through additional taxes and reduced services. As well you will have to pay for your heat pump and whatever other energy saving items that you choose. The bottom line is that we have been given the royal shaft from the promoters and approvers of the Muskrat.

    • When quality cold climate Hps are installed using best methods, a reduction from 65 % or more on heating costs should be expected. Ad an investment, It should give a return I would think of over 10 percent , and maybe 15 percent, as compared to 1 percent in a bank savings account , or 8 percent permitted to the power companies to earn. The return gets greater a s the rates go up. It does not negate the shafting of MF, but two wrongs don't make a right, and I suggest it is wrong and also dumb not to invest is very cost effective energy savings.
      And 3 wrongs would be to allow govn to pass the carbon tax to the polluter sector, as disquised as the environmental croud. It should go to homeowners to help them save and further reduce energy sue. Soon that will be a done deal too with residents missing the boat,ignoring the back room boys and gals at work.

    • Yes b'y… wer all gonna install $10k HP systems and huddle in our homes, bundled up like bloody astronauts, stinking of BO so we can save a few lousy shekles on hot water to offset the horrendous cost of living on this godforsaken, sub-Arctic rock? Governed by a bunch of dimwitted partisan fools and dodgy culprits who spend half their time living off our tax dollars in Florida??

      You can count me out…

    • Anon, it will take 10 or 12 years for most homes to convert over, even at a robust rate. Those first in can expect to take 5 or 6 years for payback, once rates double the payback is 3 years. A typical house saves would cost 7000 and save 15 ,000 over 15 years, which will be 30,000 saved when rates double. A few sheckles you suggest! Most install a 4000 unit which supplies 70 percent of their needs, the main areas.
      Count you out, that is good as you pay the high rates and save nothing on heat, so you help the failing economic case for MF,to try to keep demand high. See how long you pay those rates before saying uncle. Guess you keep your money earning 1 percent. Blaming those fools and culprits will not keep you warm on this rock, and those fools will have HPs for their houses here, and HPs with AC in Florida. Of course HPs here give AC also, good for a month in summer.

    • Hi Winston,

      You are right when you say that 2 wrongs do not make 1 right. Where you are wrong is that a program for efficiency would be an extra wrong that would not deliver any right.

      The sole purpose of efficiency is to reduce consumption.

      The two benefits from reduced consumption is a reduced amount of power that you need to produce and a lower amount to pay because you used less.

      The thing is, with MF, you can not reduced either. The production and transport infrastructures are built. The flooding of MF's reservoir is done. So the capacity to produce and transport has been built and it is too late to avoid them and the associated cost.

      As for the reduced amount to pay, MF must be paid for no matter what. Like D. Vardy said in a previous post, the only thing that could be worst than the actual MF would be to pay twice for it. You have to pay for it once, no matter what. Are you really so willing to pay for it a second time by funding an efficiency program ?

      You preach for your own business because you install these pumps. Still, you have to understand that the benefit associated with the product you sell is true only at an individual level. If a single guy do it, then yes, he will save. But once you installed one pump in everyone's house, none of your client will end up with any saving because the government will negate your effort. The government must collect the money required to pay for MF and if you prevent them from collecting it thanks to the quantity of power Newfoundlanders consumme, they will do it with the rate, with a different tax or in any way they wish, but they will do it.

      Should you wish to consider an even larger picture, you will realize that your efficiency program would cost more to Newfoundland than anything else. The reason is that the pump you installed were manufactured outside of Newfoundland. So the money associated with the cost of the pump leave Newfoundland and spin someone else economy. Because every Newfoundlander will have to pay the same amount for MF, better to pay it all locally and keep all that money locally.

      Newfoundland chose to pay the big price to end up with a surplus of power similar to the one we have in Quebec. As you said, two wrongs do not turn in one right. We have way too much power to the point we waste it at very low cost and price. No need for you to do the same. Better to buy your electricity from HQ to reduce our surplus than making a surplus of your own…

    • Well said Heracles31, yet again… votre logique est indiscutable…

      Like I said before, NLers could've bought UC power from HQ for pennies until 2041. Instead the hot-headed Williams and colossally naive Dunderdale foolishly attempted to salvage the pride of a duped generation of NLers by doing an end-run around Quebec, and thereby inflicting irreparable damage on the fiscal stability of an entire province, and saddling generations of NLers with untenable levels of debt for the MRF fiasco.

      Talk about cutting off your nose to spite your face…

      On another note, if there are shills out there using this blog to promote heat pumps or similar contraptions for their own personal financial benefit, then the moderator should ban them from posting any such one-sided commentary.

    • Heracles, almost missed your comment. Disappointed, seeing I invited you to Nfld for a visit and a chat over a coffee that you make false statements against me, and to which Anon at 19:02 jumped in to imply I should be banned.
      1. You say I "preach" heat pumps because I install them to benefit my own business. False, and if you do it intentionally then you lie.
      I did install one for a friend in 1994, so 24 years ago. I installed one for my cottage about 8 years ago, which I monitor now for over a year, and preach a bit about 300.00 a year plus tax in heating costs which is true. This monitoring is very time consuming, and in 2012 I monitored a bit before that to present evidence to the PUB and to the PUB again in 2015.
      I do not install them, nor sell them , or advertise them,and make no money whatsoever from them, and regular readers here know that. You take away from any opinion you present when you make fake news.
      2. The debate over Efficiency programs is a complex one, but Military Engineer gets it when one looks at diminishing returns from rates too high, and it destroys the economy. Manitoba struggled with this and brought in a modest Efficiency program. A change over to HPs take a decade, but also shifts the MFs burden more to the taxpayer instead of the ratepayer.
      And you seem to not understand human nature to think people are foolish enough to pay 17 or 23 cent power to save the boondoggle. Many can and will go to efficiency, and not just heat pumps. The law of elasticity, as said by Dave Vardy.
      All houses in Nfld can go HPs for about 1.5 billion with a good return in saving, so it makes sense. It made much more sense prior to Mfs sanction, but still makes sense.
      As to keeping money in the province that was an angle used by MFs promoters, and money in fact going to Quebec, 2 billion, Ontario , 2 billion, Italy , about 2 billion, others to China and Turkey and the USA, and then the bond holders money going out for decades in interest payments. As to HPS, yes made in Asia, with steel , copper and nickel etc , much coming from Nfld raw resources, made into Hps then saving Nflders 30,000.00 per family over 15 years at 23 cent power rates. Not bad.
      HPs are like refrigerators, soon , with power hikes, everyone will want one. No selling or promotion needed. Soon not incentives needed, as they have an awesome savings on heat cost , especially for our climate. This is hardly debatable any more. Just a few years ago someone would ask , What is a heat pump?
      Hamburg, Germany is now banning older diesel fuel cars and trucks. Better technology and efficiency is the future, even with Bombardier, which I admire, but I do not sell them either.
      Being wasteful with electricity in Quebec makes sense at power rates of 8 cents, and here even with 10 cents, but not any longer. Unfortunate we need to invest twice, but MFs is not an investment. Hps are.

    • Winston , here is my crude translation, sure others can correct me, especially the author, or if my daughter were here she would translate it correctly, as she is a French teacher. " it is a waste of time Hercules, to try and reason with these people, same as trying to reason with a rock". Cheers, average Joe. Lol, funny anyway!!!

    • Thanks Joe. It made me smile. There's a catchy song "Like a Rock" by the BOSS, I wonder. Of course, "these people" implied Nflders in general. Now I would not hold that comment or Heracles against French people in general, and more just disappointed in Heracles, that may have sourced some misinformation and went with it.
      But i will challenge his logic further, soon.

    • Heracles is kind of right here.

      A. About $15B has been sunk in MF – so that's gone. This debt must be dealt with. (via the most effective way possible, with the least damage to NL's economy/competiveness). Increasing rates might be an efficient way to recover some of the moneys, but not necessarily so. It has to be assessed against other means, like selling assets, increasing taxes, decreasing/align gvt spendings to decent level etc.

      B. NL (will) also have an x amount of hydro to sell. An optimum rate will have be determined that ensures maximum revenues, while minimising impacts on the economy (and taking into account demand elasticity / eventual diminishing return etc.)

      Any government subsidies/grant program toward energy conservation (via HP and what not) would be a total waste of precious capital money. There are no points to save electricity if this results into surplus/unsold hydro.

    • Ex Military
      Heracles is kind of right you say:
      Heracles lists 2 reasons why reducing electrical consumption is good, and then assumes he has covered all the bases on that, to move on to his preferred conclusion. Now as to incentives for conservation, notice I say we're moving to rates levels soon where incentives will not be needed ( unless one wants a more robust reduction and savings on heat bills), and which would not be a total waste I submit.
      In my prior analysis (I will get you links) I stated 9 reasons for benefits of energy conservation. Following Heracles comment,(and searching for my PUB submissions of the past, I came across a 25 page report by Ireland , as to conservation for house energy, and they add a few reasons different from mine, but valid here, so about a dozen reasons.
      Now on the other point, Heracles accuses me falsely of promoting HPs , that I sell or install them, so make my comments here to financily benefit. Is he kind of right there? He is an IT guy, information technology, so how did he go wrong there? I await his reply.

    • Hello Winston,

      I also believe we should not increase rates to the point of inducing an energy conservation shift.

      That would get us further into a "diminishing returns" zone, making marginal increases of revenues insufficient versus the damage to NL competitivenes.

      Such damage would be even more unwarranted if it just results into additional surplus/unsold hydro.


      Now, I definitely don't subscribe to the idea of you falsely of promoting HPs etc.

      We all could sense your "engineering" fascination to achieve optimal energy efficiency via HP, and get the best bang for the buck invested. I actually share the same fascination, so I definitely hear you on this.

      I recall that about a year ago I asked which brand of HP you would recommended, and you directed me to this Gvt of NS site. (So you definitely did not attemp to promote any of your products – if you happened to sell any)

      I suspect Heracles meant there could have been an "appearance" of possible conflict of interest – which via a very strict definition, could be said.

      But we all know that it is not the case in reality.

      Take care Winston. We enjoy all of your contributions.

  12. Winston , Tor and others, that mentioned SWARM, and generations. Nope Winston and Tor we can't do that we are the boomers, not certain about Tor. Here is a quick lesson in generations, and the years vary slightly. Boomers – the builders – talk- words – the bloggers born before 1960. GenXers – the doers Tv – pictures, born between 60 – 80's. MIllennials the adapters – precious- baby on board – tweeters etc. born between 80 and 2000. So we can't do swarms on this blog, most of us are boomers. We may engage 1 per cent of the population because we have to explain to each individual, that's who we are. The GenXers but especially the millennials now they know technology they grew up with it, they know how to do it, the doers and adapters. They can organize a swarm, they may even use a different word. And, I think this can only be done at a critical time, like when hydro rates go up, and you are freezing in the dark. Like maybe this January or maybe next January. And if you don't believe me, Google Mary Donohue, or maybe others, and she will explain it all. Cheers, Joe blow, AJ.

    • Yes Joe , you size up the generational differences very well. We bloggers, or who comment , are perhaps a bit like the wise elders in aboriginal society, or see ourselves that way, except few listen to us, so we talk to each other, about 1 percent.
      A few years ago now, I said people will only get upset once high rates are a reality. That is what happened in NS, and people got riled up, and not happened here even yet, so no swarming .
      Nothing brings people to attention like stiff cost increases. Gas is now about 6 dollars a gallon, imagine if we are to go to the pumps tomorrow and it is 12 dollars. People now line up to save 2 cents a liter, less than 2 percent, or use a point card to save 1 percent. The fall out will hit when power rates make the shock rate ..consecutive rares of 10 percent a year. They think they are smart to bring in 9 percent on July 1 and another 9 on next Jan 1, as it it 2 different year, but only 6 months actually, so 18 percent they aim for,and Nfld Power aiming to tack on another 3 percent.
      By the time the other generation types wake up, they will wonder what hit, and why no one informed them. Never heard of Uncle Gnarley or Average Joe they will say…..but lets swarm now that the deed is done, as they will be all pissed off and whining.

  13. If ALL rate-payers just refused to pay their electric bill, or only paid a token portion in protest.. what could NL Power do? Cut everyone off.? And thereby sever their revenue stream? Not likely.

    If you want an effective "swarm", social media will make it possible to organize a boycott of electricity bill payments when such rates reach a certain critical rate.

  14. This to remind readers of our 3 billion a year health care cost: tonight public forum :Critical ConditionHosted by Anthony Germain, Bruneau Centre MUN , ^;30 to * pm
    Can watch on CBC Nl Facebook, or CBC NL you tube channel . Can email re your concern , issues or questions.

    Health care, already bad, and, in some respects near third world care, sure to suffer further from MFs fallout. ong term care: physical restraints used 14.2 % of patients, Canada 6.5 %, antipsychotic drug used on long term care, 38.3 %, Canada 21.9 %
    When I'm ready, someone please put me away, without pain, like we did with our old Labrador retriever, with mercy, in 30 seconds, gone.
    Winston Adams
    Winston Adams
    Winston Adams

    • Lol Winston, know what you mean…but I had an elderly uncle, that had it all set up and arranged, to have lets say, George to shoot him when the time came. The only problem was George died first. Lol. But I notice you said someone, or maybe anyone, so it could be more definite that your wishes will be executed as detailed. Take care, and keep on trucken' , says, Joe blow.

    • Have to try and have a sence of humor, Joe, even if dark humor. as you see, I have not finalized plans yet. And if George dies, then need plan B.
      But I like the dog treatment, and many ways dogs now pampered more than humans, and die better. Our first Lab, my wife arranged for the vet put down, and she asured me it was swift and painless with an injection that tops the heart. So, 15 yers later and Lab no 2, the vet came toour house and I got the nerve to stay and watch, and : not a twitch and a few seconds , maybe 15. Could you ask for more? Compare that to restraints in along term care home. They don't call it long for no reason, so long and torture. If they don't tie you down, they destroy your mind and body with drugs that cost 10 cent each , so much cheaper than minimum wage workers.
      So, a vet seems good. Now if restraints drop to 1 percent intead of 14, and psycho drugs drops to 5 percent instead of 38, I might, but only might, reconsider. THey are working on a plan, but o details, and I'm not getting any younger, and now the House is closed for the summer,and just hope it gets passed quicker than the MFs rate mitigation plan. Hard times Joe.
      Winston PS: very small turnout for Critical Condition. Got to be our culture. Much like the PUB hearings.