I must say I am intrigued, and a little bit frustrated, by part of your letter. Originally, my column spelled out some concerns about how the government would mitigate electricity prices. It said, “This is from the provincial budget: ‘Future electricity rate management is a priority of our government. Nalcor has been directed to source $210 million to lower electricity rates starting in 2020-21, with this preliminary rate reserve growing to $245 million in the following fiscal years. We are committed to ensuring electricity rates are competitive and will undertake work to further define mitigation actions and dollars required.’ What does mitigation even mean? How do you ‘source $210 million’? How to you ‘grow’ it to $245 million?”
Your response was, “We have directed Nalcor to find ways to manage rates. The fiscal forecast in Budget 2017 indicates $210 million to lower electricity rates starting in 2020-21, with this preliminary rate reserve growing to $245 million in the following fiscal years. In addition, an internal committee within government is tasked with ensuring rates are managed as best as possible.”
While you are responding to my column, you seemed to have missed that I was posing a question: where does Nalcor come up with close to a quarter of a billion dollars, especially when it currently needs regular injections of equity cash from the government just to keep going with Muskrat Falls? Any clarification of that source of funds would be welcome.
One other thought on your letter: roughly eight times in it, you refer to the mistakes of the previous government for the pit we find ourselves in now, using words like “inherited,” “gambled” and “rejected.”
While there is surely plenty of blame to be borne by the past government, there’s blame for everyone involved in allowing this project to move forward.