Tuesday, April 24, 2012


 The Province's Natural Resources Minister says he does not have an emotional investment in Muskrat Falls but despite ordering new studies on alternative energy sources, NALCOR has been given the green light to start building infrastructure.

I am not sure how green lighting infrastructure  jives with  Jerome Kennedy 's statement that  the government will walk away from Muskrat Falls if the final numbers on the hydro megaproject don't make sense!

The proposed Muskrat Fall's Project between Emera & Nalcor has been loosing credibility like a punctured balloon. The project has not been sanctioned. It has not passed through the final decision making gate but contracts for site preparation and snow clearing have been awarded!   In addition, contracts to build roads to the proposed site on the Lower Churchill  could be awarded this week!

Nalcor brass seem unfazed by the Public Utility Board, the government's weakling support and concerns expressed by provincial, national and international experts that indicate that the three  major rationals for the project may  be incorrect. Muskrat Falls may not be the lowest cost option, we may not the power on the island and there is no market for excess power.

 Even the province has seen the light and has asked for more studies on alternative energy and future demands for electricity on the island.

I do not disagree with the fact that hydro is a commodity that will have a value in the future.  I took the position when this project was announced that this was an incredible opportunity. For me it was as simple as trading non-renewable rents to build a renewable source of income for generations to come. The bonus, we would reduce greenhouse gas emissions in Newfoundland and in Nova Scotia. Finding customers in the long term, for "green" energy does not concern me, the markets will be there. It is a question of making the investment for the long term.

The investment would pay for itself in the long run. I still feel that way.

However, the smoke and mirrors; the failure of Nalcor and government to address alternative energy options; the Premier's inability to project confidence and understanding of the project;  the refusal to have a debate and vote in the House of Assembly; the messaging about export revenue and than meeting "unproven" energy demand hikes on the island; the ring fencing to ensure the desired outcome from Manitoba Hydro the consumer advocate and others has soured me on the process.

Why start building infrastructure while telling us the project has not been sanctioned, More confusion for the public which just serves to undermine the proposed project even more.

In light ,of the Conference board of Canada's dire outlook for the province post 2020:

The depletion of oil reserves and fewer mega energy projects will weigh heavily on Newfoundland and Labrador, mainly from 2020 on as the population starts to decline.
We need to diversify the economy and create new renewable revenue streams. The Lower Churchill is without a doubt to create long term revenue. Like a mortgage, we can handle it over time. Combined with Churchill Falls, we could look forward to significant revenues long after the oil reservoirs are pumped dry.

Any, and all, confidence that I had in the proponents, and this particular project, have evaporated. Trust and confidence in Nalcor & the government on energy related issues has been eroded to the point of disbelief.

An honest, candid approach would have made supporting a project, that looses money in the beginning easier to swallow to ensure long-term renewable income.

1 comment:

Winston Adams( engineeringspecialties@hotmail.com said...

Peter, I am in full agreement in losing confidence in the actions of Nalcor and our government with Muskrat Falls. Conservation od energy has certain conotations: that we must turn down the heat, suffer cold etc. But the governments energy policy says "conservation and efficiency is two different things. Efficiency leads to conservation" And that's correct. To suggest that households are wasting electricity seems offensive to seniors and others doing their bit to keep their costs down.But the waste is in the inefficient process of heating the houses with electricity. We're using 100 year old technology for heating and it should be oblelete equipment. For this era, and for our climate, we can actually provide more heat for less than half the electricity. Nalcor has made no response to my presentation to the PUB on this. All their engineers are not stupid. I imagine most are very competent, and those who have worked with residential heating systems know what I proposed is not unreasonable. Yet when Randy Simms asked Ed Martin as to how much possible reductions is possible, he stammered a little and said "WE don't have a number on that" Why not? Not able or don't want to. WE need to get that number. And at what cost. I'm confident it will be much cheaper that Muskrat Falls, and cheaper than gas, with little if any price increases to the consumers for the next decade or more.They are spending 12 to 15 million a month now pushing ahead with a project that has no official green light. How many conversions to efficient heating systems for seniors and others could this cover in just one year. And what would be the accumulative effective on power demand. And then repeat this a few years. Do this and we'll wonder why we didn't start the process earlier.