Muskrat Media-6

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Local media scooped by Halifax colleagues

November 2, 2012 – A few weeks back, I wrote a series of blogs that bemoaned the lack of investigative journalism in this province around the Muskrat Falls issue.

There was no shortage of information being pushed out there from both proponents and critics of the project, but how much was truth and how much was fact? Why wasn’t the media digging to get at all angles of the story? Why was the public so confused?

I was challenged on that claim by a Telegram columnist, a talk radio host and a blogger who said such claims were a “steaming pile of horsesh*t.”

Okay, I take it back. Maybe I shouldn’t have said “investigative” journalism. What I meant to say was good journalism. Because right now, pretty much all we have is the ‘he said, she said’ style of stenography, in which reporters collect a claim from one side, the countering viewpoint from another, and foist it upon us as news.

When I worked as a journalist at The Sunday Express, we called this “spit collecting.” We did not attend news conferences as a matter of policy (with a few exceptions) and rarely followed the media herd around town. Instead, we considered what was being released, ignored a lot of it and, on those stories that had merit, began calling anyone who might have knowledge about it. We curated the information and attempted to break the truth of the story. The result was good journalism.

That isn’t happening anymore. And I wouldn’t have bothered to make this point again, but for an excellent piece of journalism yesterday from CBC Halifax.

When the 2041 Energy group raised warning flags last week about water management rights and the potential for Hydro Quebec to control water flows to Muskrat Falls, we had another ‘he said, she said’ situation. Reporters ran to Nalcor for reaction. Nalcor assured us that an agreement was in place. And that was that. Some commentators even attacked 2041 Energy for not asking this question of Nalcor before going public, as if Nalcor is the gatekeeper of the truth. 

Far from it, in fact. As this piece from Jerry West of CBC Halifax indicates, Nalcor is capable of spin doctoring as well.

Listen to this link. Pay careful attention to how the reporter works his sources to get at the truth. Note the discomfort in Gilbert Bennett’s voice when he is cornered on the key facts and forced to admit that Hydro Quebec “does have the ability to veto an agreement.”

Note that the reporter’s work was prompted by a call from the Nova Scotia energy department, who asked for a retraction of 2041 Energy’s claim that water management legal issues were unresolved. The resulting story was anything but a retraction.

This piece did not require an investigative unit with a large budget. It was turned around in one day by a solitary reporter.

The story reveals that Hydro Quebec does have veto power over the agreement reached between Nalcor and CFLCo. It also shows that Bern Coffey is correct; that legal questions are unresolved and we could be in for a significant and costly legal fight with Quebec.

It is the best seven minutes of reporting on Muskrat Falls that I’ve heard in a long time. Sadly, it was produced in Halifax, not St. John’s.

Imagine the journalism we’d see and hear if our media pursued issues with the same tenacity – not just occasionally but every day of the week.

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Recent comments

  • Peter Jackson
    November 04, 2012 - 18:45

    Bern: You and your colleagues have so far failed to even mention the fact that while HQ used its veto to reject a bilateral WMA (HQ always acts this way when it comes to provincial protocols) they did submit to the PUB, as did CFLCo. In other words they participated to the process and, at least tacitly, endorsed the outcome. They merely emphasized that their contractual rights remain intact. By not raising immediate concerns about the WMA, how can they expect to have any credible case against it? As John Samms has pointed out, you're pretty thin on scenarios in which a problem would arise, yet are so anxious that you and Dennis are willing to scare Nova Scotians into getting out while they can. This is odd, to say the least. Is this what the whole 2041 group was about?

    • Ed
      November 13, 2012 - 12:59

      Peter, you must be correct, as some 9 days have passed since your comment, and still no reply from anybody at the 2041 group.

  • EDfromRED
    November 03, 2012 - 22:58

    Why are we not seeing long form, in-depth investigative journalism on this? Do we have to wait till the 5th Estate does an expose to do what local media does not? I've seen more investigations done on shady used car dealerships on mainland/US newcasts, than seen here on a project that is staggering on such a $ scale. How much do you wanna bet that one of these years we will have our own inquiry into malfeasance like they are having now in Quebec? Maybe than heads will be removed from the sand.

  • Steve
    November 03, 2012 - 18:42

    I would like to know what Bernie and Denny are doing in running to Nova Scotia. They are clearly trying to instil false fear in NS politicians to try and quash the maritime link. These is a very dirty game and based on complete BS. Must be nice to be so independently wealthy and have the time to try and stop this project, free of charge. The boost in St. John's real estate must have lined their pockets for years to come. That or Hydro Quebec I guess. Somebody has to put a leash on these dogs.

  • Maurice E. Adams
    November 02, 2012 - 13:39

    It seems that the differences in understanding and opinion shown by these commentators (who would generally, at the very least) be reasonably informed on the issue, is all the evidence needed to demonstrate that "uncertainty" (contrary to Nalcor's position) does indeed exist. ----- To Bern Coffey's key point then --- with the planned expenditure of billions of dollars on Muskrat Falls, wouldn't prudence and common sense thereby dictate that certainty be obtained --- either through agreement with HQ or confirmation by way of a reference to the court?

  • Ed Hollett
    November 02, 2012 - 13:19

    @Peter Jackson: Your comments on the WMA seem to start from the premise that the Smallwood reservoir will now be managed to give some water to CF and some to MF and that there is enough to make everybody happy. These are not your exact words but it is the essence of your comment about the size of the reservoir and so forth. What your comments don't take into consideration is that the WMA imposed by the PUB gives precedence to CF and CFLCo in meetings their existing commitments to HQ and Twinco. You have to factor into that the clause Bern Coffey notes about additional capacity. The question is, in fact, not whether anything in this interferes with CF and its obligations to HQ. Clearly it doesn't. The Martin comments to which you refer are a red herring. The WMA, as Martin originally discussed it earlier this year in response to Tom Adams, was supposed to offset the problem with power output at Muskrat Falls due to the fact that MF is a run of river plant with no reservoir to manage its own water flows. In the end, MF produces not the 824 MW of its proposed installed capacity but something far less than that. One Nalcor figure is 515 MW. The WMA does not, as it seems, give Nalcor access to any additional water or any additional electricity from CF beyond what they might get to produce the 515 MW at MF. Coffey is now suggesting that even that might be open to doubt in some instances. This issue has been discussed in local media. David Cochrane is correct. Has it been discussed as they did in Nova Scotia? Not to the extent that Nalcor's assertions have been subjected to the scrutiny they deserve.

    • Peter Jackson
      November 04, 2012 - 10:24

      The NS piece gets it wrong. If that's discussing it to a greater extent, then so be it. They mix up the rejected bilateral agreement and the PUB-imposed agreement, and act as if hey caught Bennett in some stunning admission. The reporter clearly didn't understand the process, let alone the complexity of the deal itself. Not sure where you're getting the 515 MW figure, but the WMA states that HQ cannot demand more power than the UC plant is capable of. In other words, Nalcor can and will use MF to complement CF power to fulfill contractual demands, but neither party gets more than maximum output. There's a lot nigglety pigglety in these documents, but I still fail to see where the potential for serious contention lies. Perhaps you feel HQ will sue out of pure wickedness?

  • John Samms
    November 02, 2012 - 13:09

    Mr. Coffey, As far as I can tell by reading through the PUB documents, the GWAC/Shareholders' agreement and other relevant sources, HQ can only use any such "veto" if the WMA or MF adversely affects the contract between HQ/CF(L) Co. Could you explain where you see this issue arising? The pre-filed evidence in Nalcor's Volume I submission to the PUB makes it clear that the WMA will not adversely affect CF(L) Co's abilities to meet its contractual commitments. As such, this whole "veto" seems to be somewhat of a moot point. Your arguments that a legal issue may potentially exist makes sense, but I do not see where the issue will actually arise. Please explain this. I've emailed you asking this before, but I trust some sort of technological error precluded you from receiving it. I've written about this a few times here:

  • JM
    November 02, 2012 - 11:45

    The issue with the WMA is whether the energy will be there when we need it. It is clear the WMA purports to allow Nalcor to store energy via the CFLCo resevoir in the summer, and non-peak hours when the power is not required in Newfoundland. However, in the DG3 report this week it is clear Nalcor is depending upon 900 MW being available on the Labrador-Island Link during the peak winter periods. This is where the WMA may not be effective. The Guaranted Winter Availability Contract (GWAC) clearly identifies that HQ are entitled to excess capacity generated from the Upper Churchill Plant in the winter months. What would limit HQ from requesting all the power from the UC during the peak winter day time period when we need it? During the winter what would be the resulting flow in the river, and what would be the subsequent power in the Muskrat Falls Plant 265 miles down river? There is limited storage capacity in Muskrat Falls in the winter, as ice coverage prohibits drawing down on the resevoir. The WMA is a major open question, both as to the legal issues it raises and in relation to technically how it would work. It seems to me that Nalcor could answer questions posed by various pundits by simply releasing the hydrology reports (which have been confidential) and producing a plot of the generation (on a monthly basis) that Nalcor is assuming will come from CFLCo. Then produce a letter from CFLCo where this release of power is endorsed by CFLCo. This seems to be a minimum requirement to address the issue prior to the debate within the House of Assembly. As for media coverage, I could be wrong, but I cannot remember any media challenge to the October 22 news release from Nalcor when Gilbert Bennett stated: "No agreement or consent by Hydro-Quebec is required to provide water management certainty for the lower Churchill developments.” An agreement on water usage on the Churchill River which has not been officially endorsed by Hydro-Quebec as a shareholder in CFLCo., or as the customer, is clearly an uncertain position.

    • Peter Jackson
      November 02, 2012 - 12:08

      JM: This is truly your bailiwick. I wish you would use your name, but I understand if it presents a conflict. Can you provide more information on the ability of the Smallwood Reservoir to provide enough capacity for all? Its usable reserve is about 28 billion cubic metres, and I understand it would take months if not years to run dry on its own. I find it hard to believe Nalcor would be unappraised of its total capacity in formulating this water management agreement.

  • Brad Cabana
    November 02, 2012 - 10:43

    Exelllent article. Here's my story on it from months ago. Apparently we have no credibility though... I wonder, who has the credibility now. PS- Why the hell aren't you a ournalist in this province, because your perspective is needed daily!

  • Barb Sweet
    November 02, 2012 - 10:35

    I wasn't going to say it, but now I'm going to say it. An argument can be started without repeating the conventional wisdom that there has been no decent journalism since the Sunday Express folded. Cutting that swath of condemnation just takes away from making a point. I don't consider myself perfect, but I know there are many fine people working hard and producing great work, and that includes all media here.

  • EDfromRED
    November 02, 2012 - 09:59

    I'm starting to think there must be some juicy dirt in those "Purple Files" on individuals in the media, that was supposed to be in the former Premiers office. That would explain the kid gloves treatment, and decided lack of hard hitting reporting on this issue.

  • David Cochrane
    November 02, 2012 - 09:02

    You persist in saying that local media has failed to cover this story properly. And you persist in being utterly and completely wrong. If you listen to that CBC NS interview - and if you actually follow the Muskrat Falls story - you will note that there is nothing new in it. Yes, Hydro Quebec has a veto right baked in the CFL Co shareholders amendment. I did that story a decade ago when I was leaked a copy of the shareholder agreement. Yes, HQ balked at signing onto a new water management agreement. Danny Williams announced that in a scrum at the House of Assembly. Then - as allowed by law - the PUB imposed a water management agreement on the two parties for the effective management of the river. This was covered by all media when it was done.And now Bern Coffey says there is the possibility of a legal challenge to that water management agreement. An issue given coverage when 2041 issued their water management critique a week or so ago, quickly followed by Nalcor's rebuttal. Yes, what Information Morning did would be new to the Nova Scotia audience. But none of it should be new to people who pay attention to the coverage of the story here in NL. Especially not people who purport to be media critics.

  • Peter Jackson
    November 02, 2012 - 08:44

    Hydro-Quebec does not have a veto over the agreement. If they did, there wouldn't be one, because they didn't sign on. Yes, the agreement had to be imposed, but only because HQ typically played laissez-faire with it considers to be an internal NL matter. If you check submissions to the NL PUB, you'll find that although CF(L)Co wouldn't reach a bilateral agreement with Nalcor (that's where HQ veto came in), they did submit to the PUB and commented on the proposal. They looked at all the clauses, noted that the precedence of the initial CF contract is acknowledged, and added some clarification. That was a sort of tacit agreement. The real question, as Martin and others have emphasized, is whether this agreement works to provide HQ's contracted supply of power. There is no evidence to suggest it can't. And HQ would be on pretty thin ice trying to interfere for no reason, since it did stick its oar in with the PUB. Halifax Morning (and/or Coffey and Browne) also misinterpreted the 1984 constitutional challenge. The essence of that Supreme Court decision is that NL DOES have a constitutional right to its own resources (including waterways) but that the intent of the proposed act was to break the contract with HQ. That is why it was rejected. The water management agreement does not interfere with HQ's contracted supply, nor does it give CF(L)Co extra power to sell as it pleases (which would also be a violation of the contract). So what sort of case would they have? I'm no lawyer, but I think Coffey et al. have blown this supposed risk way out of proportion. There is always a remote risk of a court challenge in any venture. I am not being an apologist for the government. But I do think some of the anti-Muskrat arguments fall flat. This is one of them. In my opinion, there are more important concerns: the consumer demand forecast is a major one. There's a particularly damning critique of the methodology by lawyer Ed Conway in the PUB review documents. Without the predicted revenue from ratepayers, Nalcor's debt recovery plans fail. Also, I think the call for expert witnesses in the legislature is valid. Dunderdale says all the experts have been consulted, but a House debate would centralize all their arguments and make it easier for people to judge the case.

    • Bern Coffey
      November 02, 2012 - 12:02

      One basic premise underlying the actual operation of the CF(L)Co-Nalcor WMA is that after water is "stored" for Nalcor in the CF reservoir, the "stored" water would then at a future time be used by the Independent Coordinator to schedule "CF(L)Co production for Nalcor." Scheduling CF(L)Co production for Nalcor requires utilizing capacity at the CF Plant, and that will be problematic - if not impossible - if HQ were to exercise its 1969 contractual right to request any and all available additional capacity at the CF Plant. What some may fail to appreciate is that the 1969 HQ Contract (and its Renewal) and the 1998 GWAC are on their face agreements not simply for the supply of power to HQ, but for the supply of power to HQ from the CF Plant using water in the CF reservoir. The CF(L)Co-Nalcor WMA purports to alter HQ's contractual right in that regard by purporting to allow the Independent Coordinator to schedule "Nalcor production for CF(L)Co." Whether HQ will challenge that alteration (and possibly others) of HQ's contractual right(s) is at present unknown, as is the final outcome of any such challenge. By way of contrast, the Nalcor-Emera arrangement (specifically the Energy and Capacity Agreement) is a contract for the delivery of power by Nalcor to Emera, but not for power from a specific plant. The Nalcor-Emera arrangement is based on Nalcor being required to supply Emera with power that is the equivalent of 20% of the theoretical output of the MF Plant calculated using a numerical simulation; Emera has no contractual right to power from the MF Plant. Nalcor could supply Emera using electricity generated using water, wind, hydrocarbons, etc. What would be the practical result of Nalcor coming out of the wrong side of a legal challenge by HQ? For the likely answer, one can read pages 11-17 of the Pre-filed Evidence portion of a 2009 submission Nalcor filed with PUB. The section in question is "Purpose of the Water Management Agreement." In it Nalcor spells out how problematic power production would be on the lower Churchill River [at Gull Island and Muskrat Falls] without a "working" water management agreement. See pages 47-53 of 98 in the pdf found at: This is not to suggest Nalcor could not advance legal argument(s) in support of its position should HQ challenge the implementation of the WMA. The point is simply that the outcome of any such legal proceedings being in Nalcor's favor is far from certain. Surely, with billions of dollars at stake, legal certainty is necessary.