Wednesday, October 10, 2018


It is stupefying! 

From Economist Wade Locks wishing he had adhered to the advice of his wife and not get engaged in the Muskrat debate to the testimony from Grant Thorton analysts - the inability of the provincial government to put the brakes on the Muskrat Fall's Development in 2011 is bewildering. 

The wish to unlock the geographic stranglehold that Quebec has on developments on the Churchill River created much support for this current project. In fact, nearly all of our premiers have been haunted by it. The twin potential of  Gull Island and Muskrat Falls (Lower Churchill) long considered as two of the best-undeveloped hydroelectricity projects in Canada.  The political will to force some sort of trans-Canada hydro electricity grid never fermented and Williams decided in 2006 that we had the ability to go it alone with a 20-20 deal for Nova Scotia and an expected federal government loan guarantee. With booming oil prices and a very real demand for electricity in the United States, the decision was made to dam the torpedos - Full Speed Ahead. A lot changed in the 6 years leading to the sanctioning, not the least of which was the shale revolution which would lower demand and costs for energy in the United States. 

After listening, reading and then reflecting on former Premier "Denial" Williams testimony and media comments, the story of the American aircraft carrier that attempted to bully a lighthouse into moving out of its way popped to mind.  The origin of the tale is debatable but the point is clear. 

US Ship: Please divert your course 0.5 degrees to the south to avoid a collision. 
CND reply: Recommend you divert your course 15 degrees to the South to avoid a collision. 
US Ship: This is the Captain of a US Navy Ship. I say again, divert your course.
CND reply: No. I say again, you divert YOUR course! 
CND reply: This is a lighthouse. Your call.
$14 Billion and rising, the PE Muskrat Falls continues to steam towards the rocks leaving a disaster of catastrophic proportions for generations of us that choose to stay here. 

News last week that Astaldi has not been paying benefits it has collected from workers to the trade unions because of its tight fiscal position became even scarier with the revelation that the Italian firm has found itself in a messy legal fight with NALCOR over an extra  $200 million unpaid debt. The primary contractor, which claims to have completed 95% of the project, is asking for arbitration to settle what it labels as breaches of contract, fiduciary duty, and duty of honest performance. 

As if the project was not causing residents enough anxiety with the 'Share Pain" approach to financing. You know,  the pre-2011 scheme to make sure that the ratepayer is on the hook for the ballooning megaprojects cost. Nothing presented at the inquiry to date has lessened our anxiety - only amplified it.  

Still outstanding are issues including, but not limited to, the stability of the North Spur, the control of the Churchill River water flows to run the turbines to produce electricity and challenges with General Electric related to turbines and the software needed to run the power grid. Do you remember the pat reply to questions of concern - trust us. We would never put the province's future at jeopardy!

How do you not trust the pilot to get you to your destination on time and in one piece? They deserve our trust. We trust that the airline has done all of the required maintenance on the plane, that the pilot is capable and has regular psych examinations. They deserve our trust, how could the industry work any other way.

In this case, despite knowing that internal and external EXPERTS had questioned the ringfencing of the bogus lowest cost alternatives, the government refused to give the Public Utilities Board the time needed to review the proposed project. They attempted to BULLY those concerned into submission.

Yes dear readers, the government decided that it was full course ahead - no little island or lowly light housekeeper was going to halt the progress of this Pink Elephant.  Now, the chastised "bullies" or "bottomfeeders" have been proven correct, the project is on the rocks. I think it was Cabot Martin who coined the term Muskrat Madness. The extent of that madness is now on full display. 

The big question in my mind, in addition to how will pay for it, is how much higher will the overruns be and will the project ever be completed?

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