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Wade Locke regrets 2012 presentation

Memorial University economist Wade Locke testifies Tuesday at the Commission of Inquiry Respecting the Muskrat Falls Project in St. John’s.
Memorial University economist Wade Locke testifies Tuesday at the Commission of Inquiry Respecting the Muskrat Falls Project in St. John’s. - Ashley Fitzpatrick

Inquiry hears about personal attacks on Memorial University economist after pro-project public talk

Economist Wade Locke stands by his work on a presentation, an early assessment of the Muskrat Falls project, even if he wishes the public talk had never happened.

In January 2012, the hydro project was still nearly a year from sanction, and a lecture theatre at Memorial University of Newfoundland’s St. John’s campus was packed for the presentation, titled, “’Muskrat Falls: The best option?’ A public forum.”

Locke had read a paper co-authored by former Public Utilities Board chair (and now Concerned Citizens Coalition member) David Vardy and didn’t agree with points made. Locke suggested a public discussion or debate. When Vardy declined, as per an email now in evidence, Locke decided to speak about his own understanding of what the project entailed.

Based on a review of the public information, including capital cost estimates for Muskrat Falls hydro power and energy forecasting, Locke spoke in favour of the hydro project.

“On the balance of probabilities, it seems reasonable to me to assume that Muskrat Falls is the best option for the province,” he said at the time.

He wasn’t paid for his presentation.

On the stand Tuesday at the Muskrat Falls Inquiry, Locke was asked about other financial arrangements dating from November 2003 to December 2017, including a total of just over $615,000 in contracts with the provincial government involving Wade Locke and Wade Locke Consulting, and just under $332,000 involving Strategic Concepts, a company Locke has contracted with.

He clarified consultant work involved subcontractors that, for example, would have received over $180,000 of the payments from the province to Wade Locke and Wade Locke Consulting. And less than half of what was paid to Strategic Concepts involved him, he said.

The consulting contracts also landed years before and after the Muskrat Falls sanctioning. They covered subjects unrelated to the debate around the power project, for example $34,500 paid out over 14 years ago for an evaluation of the province’s prospector assistance program and junior company exploration assistance program, or $22,800 to look at the economic contribution of agriculture and agrifoods in 2007.

But some contracts did include work for Muskrat Falls proponent and Crown corporation Nalcor Energy, including a series of assessments of the economic impact of the corporation’s operations and investments in the province, beginning over two years after the Muskrat Falls sanctioning.

And there were contracts pre-sanctioning involving Strategic Concepts where Locke acted as a subcontractor, to evaluate the potential employment and income effects of Muskrat Falls. He disclosed that work at the time of his public talk.

Memorial University economist Jim Feehan.
Memorial University economist Jim Feehan.

Asked if he should have publicly said more about contract work at the time, he said “no,” that the disclosure at the time of his talk was adequate. And he talked about the importance to him of professional integrity.

“I don’t believe that any of these contracts, I was being hired for political patronage or to channel money to me in order to influence my particular views,” he said.

“It was for a particular reason, not because I was a political something or other. I’ve never done work for a political party. Never. I’ve been on the receiving end of some negative things from parties, all parties, just so we understand that, too. But I continue to do what I think is appropriate to do. And in no cases did the amount of effort and time that went into it and the remuneration I received for it, did that influence what I had to say in the Muskrat Falls presentation at the Harris Centre.”

Locke’s 2012 commentary was later used by politicians to promote the project.

Locke said he was “vilified” in public, and the personal nature of the commentary has affected him emotionally and psychologically.

“I’m OK with people challenging my ideas. I’ll live with that. If I’ve made a mistake, I’ll admit that I’m making a mistake and I’ll try to correct it,” he said. “But you know, I’ve worked hard at trying to be healthy, I’ve struggled with weight all my life. I don’t think it’s appropriate to be attacking me on a personal level. I’m not a politician, despite what people think.”

His wife warned him not to get involved with the Muskrat Falls debate, he said, and if he had his time back he would have listened.

His presentation was qualified on the day. Explicit statements noted it was based on information available, that there were scenarios that could change the outlook, even if they “require assumptions that strain credibility.” That line referred to the idea of a long-term $50- to $60-per-barrel Brent crude oil price.

Locke did not challenge the capital cost estimates. The presentation did recommend the province give the PUB time to review the later “DG3” estimates as it saw fit.

The economist is in support of the inquiry, “because it should help at some point understand what happened, how it happened and what we could do differently for things like Gull (Island) or other projects, in order not to make whatever mistakes we made with this.”

The afternoon continued with Memorial University economist Jim Feehan on the stand. Feehan stood by his early commentary as well, saying he didn’t, and still does not, see evidence of an aggressive approach to energy conservation for the province.

Ron Penney and David Vardy, members of the Muskrat Falls Concerned Citizens Coalition, are scheduled to be called to the stand Wednesday.

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