The Muskrat fiasco

There is but one word to describe the goings-on at the Confederation Building. That word is fiasco.

When the largest, most expensive, potentially disruptive undertaking in the entire span of their history is threatening the people of Newfoundland and Labrador, and yet is not to be given formal, insightful, detailed consideration by their duly elected representatives, then no other word can describe that outrageous situation.

The proposed Muskrat Falls project wil consume funding at least equivalent to an entire annual provincial budget appropriation.

The proposal as stated indebts consumers and taxpayers for fully 50 years.

Its excessive costs will disallow, for a generation or longer, other significant capital expenditures needed for economic growth.

It will impose an export-driven orientation on provincial economic policy of such urgency that internal growth matters will become secondary.

Yet, it is being handled by the administration like a trip to the supermarket for the week’s groceries!

It is partisan business as usual. The public is treated with glossy bits of advertisement worthy of ladies’ hair-spray promotion.

It has pitted public interest against Crown corporation hubris, with ministers firmly in the latter camp. It has sandbagged the media to such an extent that the deeply troubling outcome is an admitted foregone conclusion.

Individual dissenters have been driven to questioning whether the province is still a democracy.

This is decidedly not good enough. What has happened to the governance mechanism?

Granted, the recent past has witnessed other strange events, such as the unthinking expropriation of a multi-million-dollar property, or unmindfulness as a basic industry deteriorates, or acquiescing to cavalier abandonment of solemn undertakings by industry.

The will, or capacity, to govern has weakened in past decades. Yet, the present constitutes a very low ebb tide indeed.

Does government not appreciate the danger it is courting?

Are the people not yet sufficiently alarmed at what inevitably awaits? Will the final result be another 1932 bankruptcy, public uprising and loss of autonomy?

As Oliver Cromwell cried out in frustrated anger at ecclesiastic authorities, “From the bowels of Christ, consider that ye may be wrong!”

J.F. Collins

St. John’s

R R: - December 2, 2012 at 03:37:45

Poor Cathy, Danny's talking head and shoe shine girl. She had nooo idea why Brian was going to Labrador....oh my if it wasn't so sad it would be a skit for "Snook" !!

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Winston Adams: - November 27, 2012 at 11:23:41

John Smith, where is your constructive analysis of the efficiency solution? This costs about 10,000.00 per household instead of 60,000 to 100,000 per household with MF. And you say island small hydro, costs a few billion. MHI costed this 9 months ago at 398 million. Your are a master in misleading the readers. Efficiency for the island costs 1.5 billion but is self fiancing from energy savings. Local wind addition of 100MW and small hydro cost 638 million combined. It seems it may be prudent to replace Holyrood with gas turbines instead of expensive upgrades. Gas turbines can work much better at optimizing wind power contributions to offset oil use. The existing units have mininum operating requirements, a poor situation to benefit from wind. Read the Hatch and hydro reports John. Or have them explain it to you. Interesting that the amount of local wind that is acceptable jumped 3 fold or more since Feb. You are silent on that.

Cold Future: - November 27, 2012 at 11:10:41

John, what you're shovelling continues to smell pretty bad. It would be good if you could come up with something fresh, and new and accurate. If you could agree that we are spending about $3 to $4 billion to go around Quebec and there is no way to negotiate with them and we must adopt the fighting newfoundlander stance and do it now. We don't need the power but we need to do this now. 200 Mw for NS plus 475 MW to replace Holyrood and 600 Mw to sell at a loss to the mainland. Total 1275 oops Muskrat is only 800 Mw-we don't need the gulf cable after all.

wtf: - November 27, 2012 at 10:31:18

Is this the same "J.F. Collins" that was Peckford's Finance minister? If so, it would have been nice if he and the boys of yesteryear had practiced what he is now preaching.

John Smith: - November 27, 2012 at 10:04:37

Hilarious...so funny. Currently the project will cost us about 6.2 billion, we will have approximately 2.6 billion to put down in cash, that is the rumour, leaving about 4 billion for us to finance, with the lowest interest rates, and the best creditrating in our history. If you then add in the loan guarantee, and the sale of power on the spot market, the deal even gets better. So, we will finance less than 4 billion dollars, what we spend on healthcare each year, for a project that will last 100 years. The project will not be reflected on our debt, because it will be a "concrete" assett. Not like a pension contribution, it will be brick and motar, and will have value on the assett side of the ledger. As far as the interest goes, when you buy a house, does the price include interest charges? When you buy a car, is the interest included in the price? No, it is a separate piece. The bottom line is do we need the power...the answer is absoluely yes...then how do we generate the power? The muskrat falls deal comes in 2 billion cheaper than the nearest alternative. So I say to you Mr. Collins, if not muskrat, then what? What is your proposal that will get us to where we need to be. We have a plant in Holyrood that is about to fall down around our ears, and will cost billions to refurbish, then if you add small hydro to that you can add a few more billion, which will only get us further down the road, before we will need to spend more money. Muskrat will not burden us with excessive debt, it is an intelligent, well thought out, well researched asnwer to our future energy needs.

david: - November 27, 2012 at 09:57:41

Newfoundland is just going down its road of destiny. Instead of the Alaska's, or Norway's, or Alberta's public financial management plan to properly manage oil resource wealth, we are using our entire windfall to feed and exacerbate our uniquely dysfunctional political gong show. We are fully responsible for the interpretation of 'democracy' that has evolved on this island, and we deserve it. Orators of no substance, gangsters, thieves, idiots, and egomaniacs.....we elect 'em all, and nothing but.

Show me the money: - November 27, 2012 at 08:58:10

Let’s round it out to 10 Billion because the costs have risen from 6.2 to 7.4 in two years and it will take four years to build it. These are all approximations but 10,000,000,000 divided by 500,000 (population) is about $20,000 each for every resident of the province. For a family of 5, its $100,000 debt or about $277.77 + HST per month based on 30 years, just to build it! How much will we then pay on top of the construction costs for heat and light? All the rules have changed and it appears that we will be charged based on what they think we need rather than how much electricity we will actually use. Why can’t Holyrood be modernized? Has the technology to cut down on pollution not been invented yet? To tout Muskrat as clean, green and environmentally friendly is also false and ridiculous. To exempt the Auditor General from the process, bypass the Public Utilities Board and pass a Secrecy Act doesn’t exactly instill confidence that politicians are on the up and up either. These actions and others have sullied the process for me and tainted absolutely everything else about it. I want to see the spreadsheets where they figured how we could afford this because I see too much poverty everyday everywhere and I feel like a foreigner in this “new” medieval type culture steadily on the rise in Newfoundland and Labrador.

Maurice E. Adams: - November 27, 2012 at 08:44:51

What else is there to say? Unless MHAs and cabinet ministers put the best interest of the province ahead of their loyalty to the mindlessness that is driving this uneconomic and debt infested project, then this province, our children and grandchildren are facing a bleak future.

Cold Future: - November 27, 2012 at 08:41:03

The omission of the interest during construction has never been addressed-why? Also, people seem to believe that the stated 70% increases in power rates over the last dozen years will cease after Muskrat. It will in fact continue at comparable rate increases because NL Hydro and NL Power costs increase annually. Muskrat has no impact on that. The stated increase of 20 to 40% for Musktrat up to year 2030 is on top of the usual annual rate increases. The 20% to 40% is being artifically kept low in the early years to make the bitter pill easier to swallow ( by creative accounting). Many people think we can send Upper Churchill power through Quebec after 2041 without reaching an agreement with Quebec to wheel the power-good luck with that one too. Fiasco is a mild description. It is a money losing giveaway to be taken on the backs of the ratepayer causing great hardship-it is economic lunacy.

R R

- December 2, 2012 at 03:46:27

Poor Cathy...didn't have a clue why Harper was comin to Labrador! Danny sure da "Tea Cups" are playin... but send off Cathy her daily newsflashes eh?! ;)
R R

- December 2, 2012 at 03:46:29

Poor Cathy...didn't have a clue why Harper was comin to Labrador! Danny sure da "Tea Cups" are playin... but send off Cathy her daily newsflashes eh?! ;)

17°C

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The Muskrat fiasco

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