PUB forces Muskrat Falls about-face

James McLeod
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Dunderdale promises full House debate, natural gas and wind studies

The provincial government moved decisively to extinguish any doubt about the Muskrat Falls development Monday, after the province’s Public Utilities Board (PUB) refused to certify it as the lowest cost option for electricity.

In the wake of the PUB report, Premier Kathy Dunderdale promised added study of natural gas and wind as options for electricity generation, and vowed to call a summer sitting of the House of Assembly to debate the Muskrat Falls project.

At the same time, though, Dunderdale called out the PUB saying they “wasted $2 million” by reviewing the Muskrat Falls project and refusing to say whether or not it was a good project.

“They don’t disagree with us on the Muskrat Falls project,” Dunderdale said. “After nine months and $2 million, they refuse to make a recommendation.”

Late Friday, the PUB formally delivered its report on the Muskrat Falls project to the government. The board had been tasked with deciding whether Muskrat Falls is a cheaper source of electricity than an isolated island alternative.

The information it was given by Nalcor to assess the project mostly dates back to November 2010, when Nalcor passed its Decision Gate 2 and proceeded with planning of the project.

Later this year, the government is expected to pass through Decision Gate 3 and decide whether to formally sanction the project and proceed with development and construction.

In its report, the PUB said it couldn’t certify that the project is the cheapest electricity option based on the November 2010 numbers, because they’re vague and amount to not much more than a feasibility study of the Muskrat Falls project.

“In conclusion, the information which was made available during the review was considerably less detailed and comprehensive than the information that Nalcor has today and will have at Decision Gate 3,” the PUB wrote. “The board concludes that the information provided by Nalcor in the review is not detailed, complete or current enough to determine whether (Muskrat Falls) represents the least-cost option for the supply of power.”

Dunderdale said this is a change of tune for the board.


The government has said all along that its decision gate three sanctioning information wouldn’t be compiled until some time in June.

In December, board chairman Andy Wells asked for a three-month extension to give them to the end of June to complete the report. At the time, Wells said they needed more time to do more public consultations to properly assess the two options.

“What’s even more puzzling to me is that at the end of December, they came to us and asked for a six-month extension for public consultation. That’s all,” she said. “You need to ask them why, at the end of December, why they only asked for an extension to the end of June knowing full well that the sanctioning numbers were only going to be available in June.”

The government refused to give the PUB the extension at the time, saying that it was important to have time to debate Muskrat Falls in the House of Assembly.

Monday, Dunderdale said because the PUB didn’t endorse or reject Muskrat Falls, the government will chart a new course.

Dunderdale announced that the government has hired Manitoba Hydro International to do a full assessment of Nalcor’s decision gate three numbers in June. Then, she said all of that information will be made public and the House of Assembly will be called back for a special session to debate the project.

There will be some sort of formal motion, and MHAs will vote on whether or not the province should proceed with the project.

Up until now Dunderdale has said that there’s no need for dedicated debate on Muskrat Falls because MHAs could talk about it during the spring’s debate on the budget.

To mollify the opposition parties, Dunderdale said that the government will also be doing a formal study on natural gas, which the Liberals have been saying is a viable option that has never been considered.

Wind power, which the NDP has been championing, will also get another look.

The government has said up until now that these options are so obviously not viable that they didn’t need formal study.

The PUB will not get to reassess the project based on decision gate three numbers.

Dunderdale said it’s “frustrating” that people don’t Nalcor’s expertise in rejecting wind and natural gas.

“There are things we know about wind. There are things we know about natural gas,” Dunderdale said. “The minster in his wisdom has seen it in its wisdom to ask Ziff (Energy) in terms of natural gas to do a study and we’ll provide that information so that if anybody is concerned about the source, you know, we’ve gone to somebody completely independent.”

The opposition parties welcomed the moves by Dunderdale Monday, but Liberal MHA Andrew Parsons said Dunderdale was “absolutely shameful” for attacking the PUB.

“This is the government that rigged the rules of the game, and still lost the game and don’t like the result of it,” Parsons said.

NDP Leader Lorraine Michael said that the government is really just giving in to public demand for a full debate.

“The pressure has been mounting over the last months,” she said. “The government can no longer deny what’s being said out there, and they have finally given into the pressure.”

Twitter: TelegramJames

Organizations: Public Utilities Board, House of Assembly.Monday, Manitoba Hydro International NDP

Geographic location: Muskrat Falls, Decision Gate

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Recent comments

  • DON II
    April 03, 2012 - 12:16

    You are correct in the sense that the Free Trade Agreement (FTA) does contain clauses which allow for the "wheeling" of hydro electric power through power corridors in Canadian provinces which cannot legally block that power transmission if its market destination is located in the United States of America. There is nothing in the FTA to prevent Hydro Quebec from buying a controlling interest in Emera/Nova Scotia Power if Emera is willing to sell. Such a purchase would give Hydro Quebec leverage over how much power could be "wheeled" into the USA and under what conditions if it could make a case that more power from Labrador was needed in Nova Scotia, New Brunswick, Ontario or Quebec. The only protection for Newfoundland would be for Nalcor to buy a controlling interest in Emera/Nova Scotia Power or include a "right of first refusal" to buy if Emera/Nova Scotia Power was to be sold to Hydro Quebec or some other corporation or controlling interest. Without some formal contractual protection of the power corridor through Nova Scotia and New Brunswick, Hydro Quebec or any other corporation could simply wait until Newfoundland completed the Muskrat Falls project and then buy a controlling interest in Emera/Nova Scotia Power and by doing so simply hijack the project from Newfoundlands control!

  • Opposition Members please take note and asked the pertinent question on are we protected against Quebec Hydro getting control over Muskrat Falls Hydro energy from the end we assume we have complete protection
    April 03, 2012 - 09:42

    DON II you have asked a pertinent question, especially where you queried about whether the power corridor through Nova Scotia and New Brunswick has been fully protected from being taken over by Hydro Quebec. Like you said if this protection is not there, the whole Muskrat Falls project debate will be for nothing! But, to be honest with you DON II, I think under the Free Trade deals that we have inked, maybe this kind of protection is not available. After all we are living in an age under the Global Free Trade Movement where nothing is precluded, protected or sacred, everything is exposed to "hostile" takeover, except of course the Upper Churchill Project which will never be overturned because Quebec is involved. Your question is one that must be asked since I think that is primary reason why we are going this risky route in the first place that will probably sink our province into a debt that it won't be able to recover from. whether or not there will be protection in the Muskrat Falls Contract to ensure that Quebec Hydro cannot come into the picture and shaft us from the

  • Robb
    April 03, 2012 - 09:23

    Hey again John Smith.......very well said. I noticed you posted almost the same on VOCM......but when you are right, you are right........all this political posturing is costing us more and more....and you could not be more right about hte jealousy you said, even if the electricity was free, the naysayers would find something wrong with it......any fool who thinks that oil-fired electricity is not going to increase costs exponentially, they should get a reality check......did they not notice the increase in gas last week......they think this is going to stop or even reverse, they are dreamers........hydro electricity will move the ability to produce electricity by a renewable resource.....water.....not oil. But they have to say something to get face time, and man do the liberals and ndp ever look stupid every time they opens their traps........again, you should lead, follow, or get the hell out of the way......the liberals and ndp clearly cannot do the first or second, so they should just get the hell out of the way...............thsi reminds me of the time they wanted to put the harbour arterial into downtown St. John's....well the naysayers were just disgusting...they said that traffic would be unmanageable with a "super highway" off loading into downtown.......well how stupid, and if we had to listen to those jokers, it would have put downtown back 30 years of progress.....but this is the mouth, spew garbage for the sake of spewing something........without the partisan garbage, everyone would love to have this wonderful development in NL and Lab........wake up people

  • PM
    April 03, 2012 - 09:13

    It seems like all of the people required to vote " yes" to this project , were put in place by Danny before he gave up his premier status. Looks like one of them has voted "no" to his project because of lack of info. Even with all his influence, he can't get this pushed through. You have got to love democracy.

  • joe
    April 03, 2012 - 09:13

    I've been following this debate for a long time and it seems that a lot of people think with the part of their brain that deals with colour- BLUE' RED'and ORANGE.We are finally going to do what should have been done in the beginning,a full review.Is there anybody who would throw their hard earned money to a developer without doing their own due diligence first?

  • Paul Hunt
    April 03, 2012 - 08:44

    What's wrong with Andrew Parsons to suggest that the PUB are beyond reproach. What kind of incompetence would he bring to government decision making? The PUB should be removed from the review of this project if they cannot come to a formal conclusion; show some leadership and value for the tax dollars they burned up. Shame on Andy Wells, I thought he was bigger than this. However when it comes to wind energy the Liberals are certainly experts, young Parsons is living proof

  • Bill SMith
    April 03, 2012 - 08:44

    Bait and switch time. The PUB has not provided what the government wanted. So, diss them and create some other faux processes that can hopefully be manipulated to garner success. These guys are becoming experts at this. Do they use this approach throughout the rest of government??? Probably.

  • DON II
    April 03, 2012 - 08:39

    In typical Newfoundland political fashion, Dunderdale will hold a debate on Muskrat Falls this summer when most Newfoundlanders and Labradorians are on vacation, gone fishing or are up at the cabin. In the summer people will be more interested in the trout, the barbeque and the beer than in what our bobble headed politicians are up to as they put our economic future on the line with an improperly planned hydro electric project! If the power corridor through Nova Scotia and New Brunswick has not been fully protected from being taken over by Hydro Quebec the whole Muskrat Falls project debate will be for nothing! It appears that the Government of Newfoundland is prepared to build the Muskrat Falls project to tie into a power corridor line even though that power corridor through Nova Scotia could be taken over by Hydro Quebec if it buys out Emera/Nova Scotia Power. Talk about walking into a well laid trap! Did our home grown rocket scientists in the Government of Newfoundland consider that possibility? The mega project rocket scientists in the Government of Newfoundland have not learned a thing after 60 years of running Newfoundland and Labrador since it joined Canada! Without guaranteed markets for the power and without a fully protected power corridor to the USA, the Government of Newfoundland is dreaming in technicolor and is barging ahead regardless of the economic damage. It appears that the Government of Newfoundland bobble heads don't have a clue!

  • Thanks Mr. Andy Wells of the PUB for being so frank and honest with the electorate
    April 03, 2012 - 08:30

    The fact that alternative energies was not part of the Terms of Reference on the Muskrat Falls Project urges me to ask a question, were the politicians who were orchestrating this deal practicing crony capitalism better known as corrupt politics or were they too inept to create a contract of this magnitude. Now we are told by the same politicians that they are going to overlook the Public Utilities Board of this province and go solely with Manitoba Hydro International to do a second perusal and give a second review. Manitoba Hydro International already said in its report that it was a risky project and they did not have enough information provided by NALCOR. It, too, should have refused to give the go ahead for the project. As far as I am concerned the PUB did the right thing, it did not have enough detail, it said, from NALCOR to formulate an opinion, so it told the truth of the matter. Thanks Mr. Wells for being so frank and honest with the electorate, you could not decipher what was in this risky project with the information at hand and you decided simply that you were not going to be a "Yes" man for the project for the sake of ramming this risky project through to appease the government. The electorate's well-being should always come first in such instances and Mr. Andy Wells adhered to that principle.

  • saltheart
    April 03, 2012 - 08:18

    I still think it should go ahead and stop wasting all this money, build a tunnel from plum point across to labrador eliminating the ferry system and run the power lines through this corridor as well.

    • Jackie Logans
      April 03, 2012 - 14:43

      Excellent suggestion by SAL THEART. The Island of Newfoundland should indeed be connected directly to Labrador, without having to travel by ferry and landing in the Nation of Quebec. Only the tenth province would put up with this anomaly.

  • holy smokes
    April 03, 2012 - 08:01

    The provincial government moved decisively to extinguish any doubt about the Muskrat Falls deveopment Monday, after the province’s Public Utilities Board (PUB) refused to certify it as the lowest cost option for electricity........Well!! Shiver me timbers........As many had suggested ...and was done to 'spite Quebec'.. And this was from a 'business' man using taxpayers money to leave a 'legacy'??

  • Scott Free
    April 03, 2012 - 07:32

    Seems like Little Man Dan's legacy project is falling apart. Info is required!!! That secret society known as the Con Party of NL will be forced to share information, table justification, identify markets, provide guarantees, be open and transparent; then it will be scrapped because it was nothing more that an ego trip by the little tyrant. The Dunderdale bobbleheads have failed; they are in over their heads. For all the political patronage appointments, they can't make it fly because the project doesn't make sense; the indefensible cannot be defended. Democracy will be forced upon the Tories, like it or not. Premier Stunderdale's cozying up to Proroguie Steve was all for naught; no Federal guarantees and lots of pain heaped on NL; the Danny Damage Era will be felt for generations.

    • lonenewfwolf
      April 03, 2012 - 08:10

      Anything less than a forensic audit of NALCOR's books is unacceptable. There were 7.5 million shares bought of EMERA stock on Dec. 17th, 2010 for a total value of $250 million. Lavalin has contracts on White Rose valued at over a $100 million plus the contract for the Lower Churchill and associated transmission that will go into perhaps billions over the life of the project as proposed (with gull island incl.) Lavalin are being investigated by the rcmp for corruption at the request of the the world bank corruption team, and have been excluded from bidding on their projects until the investigation is complete. With CETA expected to come in soon this was a mad dash to get things in place before the rules got tightened up. Private water and transmission systems are key components for private investment right now in Canada as the border melts away and American investment interests creep north, alongside Chinese and European money. Our anti-corruption laws in Canada are far behind those in Europe and the US, and that needs to change. So maybe free trade will be a good thing here if we can get control over the govt/industry partnerships that have insidiously creeped into our democracy. Gwynn Morgan, the head of SNC-Lavalin is out in BC using Harpers $130 million payout on the NAFTA water privatization case with Abitibi to get the Liberals to bring in a new water act there (similar to ours not coincidentally) and privatize BC HYDRO via GE & Talisman energy. That will end badly for them, people in BC will not allow it to happen. We here in NL, like it or not have been part of a neo-con strategy being carried out in the board rooms of a few companies with close ties to the current federal governments circle of friends and business associates out of the school of calgary. Key factor is they tried to get at the water and that has brought in a tremendous amount of outside interest. There are always good people in the system to keep this type of thing from happening, and the neo-cons seem to think everybody wants to be like them. WRONG. We want live in a free and open society with clear rules equally applied to all citizens.

    • Wow
      April 03, 2012 - 09:46

      Looks like someone had an extra serving of hate for breakfast.

    • lonenewfwolf
      April 03, 2012 - 10:38

      what you have there is some solid research. bringing to the attention of NLer's that there are implications outside of our province's jurisdiction for the decisions made here is something we rarely hear. facts are facts. it'll all come out in the wash. just wait and see. this is part of a much bigger issue not many people other than a few concerned citizens and some int'l trade lawyers are looking at (also ofcourse corporate execs at European water/transmission utilities & the boards of companies lining up our resources for privatization here). welcome to the 21st century. the corporate state is not far off if we do not stand up and fight for our rights.

  • Maurice E. Adams
    April 03, 2012 - 07:13

    Yes John, --the power will be free ---- to Emera, and the plan is for government to make it virtually free (at ratepayer/taxpayer expense) to Danny's mining giant corporations in western Labrador. +++++ If government wants an 'independent' study, it is the PUB that has kept an open mind and is therefore in the right position to make an 'independent' recommendation based on Decision Gate 3 numbers. +++++ There is nothing independent about MHI -- in that they have already made their position clear --- that is, that in their view Muskrat Falls is least cost. ++++ So how can government now say that MHI can do an "independent" review of Decision Gate 3 numbers when they have already 'prejudiced' their position (pre-judged) their position? Do you think that they would now reverse themselves? It is the PUB that has kept an open mind. It is the PUB who is mandated to protect the public interest ---- not an engineering firm from Manitoba where a similar boondoggle project was supported in Manitoba and a firm that has already supported Nalcor's proposed Muskrat Falls project.

  • Sam
    April 03, 2012 - 07:11

    Awww...lets build the 400 wind turbines on the Trepassey barrens...isnt that what the NDP want? That will make it a beautiful, scenic drive! So much for this mega project creating thousands of jobs in the construction stage and being a green type of power for years to come. ONLY IN NL!

  • Casey
    April 03, 2012 - 07:06

    It seems people are afraid of the risks because there is no valid alternative to Muskrat Falls. There will always be risks. The greater risk will be to do nothing. NL will never get a fair deal from Quebec. The fishery is in tatters and Ottawa is unwilling to do what it takes to bring about a full recovery. They have their fisheries officers chasing boys of the government wharf with a trout hook and are making criminals out of ordinary citizens. The oil will soon run out, so what to do. Sitting on the fence will cost NL more in the end. Muskrat Falls needs to go ahead. Go for it Premeir Dunderdale!

    • Jackie Logans
      April 03, 2012 - 14:49

      CASEY hits a home run! Well said -- your common sense shines like a beacon.

  • Whaddaya At ?
    April 03, 2012 - 07:06

    Holy crap !!. If looks could kill. Lighten up, Kennedy.

  • Soon The Knives Will Be Out
    April 03, 2012 - 07:04

    This will likely get through the special debate due to the Tory's majority. In order to win the next election though, they will convince Premier Dunderdale to retire so they can run a campaign without her or Muskrat as the focus.

  • John Smith
    April 03, 2012 - 06:31

    Two million dollars and nine months and what did we get? Nothing. MHI, and Navigant could come to conclusions, independant, internationally renowned energy consultants, with the same information. Not the PUB though, they just spent the money, and gave nothing. Now, because of the know nothing naysayers we will have to spend even more money to show, again why wind and gas will not work. We have had NOIA present to the PUB explaining why it won't work, we had Husky come forward last week telling us why gas won't work...but now we will spend more money to explain...really those who refuse to understand why. Sad, but I guess that's just the way it is. They will then ask for more reviews, and more will never end. Why? Because it is not about the Muskrat project. It is about jealousy, and hatred, and ignorance. Those who oppose the project do so because they dislike Danny Williams, or the PCs or whatever. You could say the power would be free and they would find something wrong with it. I guess now we wait till the next reviews come out, and we spend more money and time dealing with the know nothings...sad. That's our history here. When something bad comes along, like the upper churchill(thanks liberals), we are all over it, but when a good deal comes way. laughable. I guess the opposition have to get traction from something, it's just too bad it had to be this...something we all could benefit from...very sad indeed.

    • Eli
      April 03, 2012 - 06:58

      JOHN SMITH you're sounding more and more like a broken record.

    • Concerned Citizen
      April 03, 2012 - 07:15

      The only sad thing is JOHN SMITH and the $2 million it took for the report but then again thats not the only $2 million that those stupid PC's have wasted. Time to sink the blue and try something new. They just want to have the right to say WE DID IT for Muskrat Falls even though it is the worst possible way to have cheaper electricity rates in the future..................AND I AM SURE WE WILL SEE IT IN THE NOT SO DISTANT FUTURE.