Memorial University professor Wade Locke clarified his independent assessment of the Muskrat Falls project Thursday — with a little help from Nalcor.
Locke was responding to fallout from a presentation he gave Tuesday evening, where he told a packed lecture hall at Memorial University he believes Muskrat Falls is the least-expensive alternative for electricity which the island portion of the province will badly need.
On Wednesday, he told The Telegram transmission costs from Labrador to the island were not included in his calculations, and that it was “probably not” a fair comparison between Muskrat Falls and an isolated island option.
Thursday morning, at 8:42 a.m., Karen O’Neill, senior communications adviser for Nalcor, contacted The Telegram, saying Locke “made a mistake” when speaking about the project.
About 10 minutes later, Locke emailed The Telegram to confirm he had been confused and misspoke Wednesday. In fact, he said, the transmission costs were included in the analysis.
Speaking to The Telegram later in the day, Locke said Gilbert Bennett, Nalcor vice-president responsible for Muskrat Falls, called Thursday morning after reading the story to explain he was incorrect.
“We don’t have a relationship with Dr. Locke,” O’Neill told The Telegram.
However, Locke said in the lead-up to his presentation he met with Nalcor officials several times to understand their calculations and the information they’ve presented to the Public Utilities Board (PUB).
“I’m not doing this at the request of them, but I have spoken to their officials, their technical people, to make sure I understand what they did,” he said.
“I sat down with them on a couple of occasions to make sure I understood how this came about.”
At the start of the presentation, Locke spoke at length about his independence and his credibility. He said while he has done work for Nalcor in the past, his current analysis was not done at the Crown corporation’s behest.
Locke said the numbers he used for his analysis were the publicly available submissions made to the PUB by Nalcor.
His statement that the Muskrat Falls project is $2.158 billion cheaper than an isolated island system is based on Nalcor’s engineering estimates. A report by consultant Navigant, commissioned by Nalcor, arrived at the same determination that the project is $2.158 billion cheaper.
He said he was confused about the transmission cost, because on some of his PowerPoint slides it wasn’t broken out as a separate cost.
However, after speaking to Bennett Thursday morning, Locke said he understood the transmission costs had, in fact, been included in his presentation.
Locke said he was trying to demonstrate the difference between the two projects hinges on the cost of fuel.
“I was trying to say that the difference between these projects is that one has a high fuel cost, one has a high capital cost,” Locke said. “When you take account of all the things in present-value terms, this is the differential.”
The confusion created intense discussion and debate online all day Thursday, as supporters and critics interpreted Locke’s comments.
Liberal MHA Yvonne Jones — one of the Muskrat Falls project’s loudest critics — issued a news release, accusing Locke of doing nothing to positively influence the debate.
“Dr. Locke’s analysis is clearly flawed and by not including the cost of transmission he has added more confusion to the public debate instead of clarity,” said Jones.
jmcleod@thetelegram.com Twitter: TelegramJames
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A few thoughts: Did you know that HQ owns 1/3 of the Upper Churchill? If we are to sell Upper Churchill power it may be an idea to have an alternative route and so, several more DC links to Nova Scotia (and vicinity) may be required. We can then develop all of the generation sources on the island and in Labrador (including wind) and export everything to the North American grid. This is probably 100 years in the future. I wonder what the cost of a kWhr will be then? This is not really relevant to the current Musrat Falls idea but Muskrat Falls is part of the bigger picture. We will be rich beyond the dreams of avarice and this is something that Hydro Quebec does not want; that is, a significant competitor. Unless we develop the infrastructure to do an "end run" around them (HQ), they will always have us by the shorts.