Add Edward Hearn, a former director of Newfoundland and Labrador Hydro to the growing list of people publicly questioning the proposed Muskrat Falls development.
In a letter to the editor of the Telegram, Hearn supports former Tory finance minister Dr. John Collins’ criticisms of the project.
Hearn says the project is liable to huge cost over-runs and that the resulting energy may be too costly to attract industrial development in the province.
Hearn suggests the province’s energy corporation should explore alternatives, including exercising taxation powers under the constitution.
While he doesn’t state it explicitly, Hearn is referring to the potential use of the public utilities board powers under the 1994 Electrical Power Control Act. That Act was designed in part to allow the PUB to allocate power generated in the province for domestic use in a way that would not violate the terms of the 1961 Churchill Falls lease or the 1969 Churchill Falls power contract.
Under sections 8 and 9 of the EPCA, the public utilities board may order producers and transmitters to meet a power allocation ordered by the board. The order would have to come as a result of an inquiry ordered under section 7:
(1) Where a producer or a retailer believes that it may not be able to supply power sufficient to satisfy the current or anticipated power demands of its customers and prospective customers in accordance with the power policy set out in section 3, it may request the public utilities board to conduct an inquiry into the matter.
The Clyde Wells administration revised the Electrical Power Control Act in 1994. The basis for the new Act was a report presented to the Brian Peckford administration in 1986 by Wells and other officials of Newfoundland Power at the time. The Act as it was originally laid out applied equally to all electricity producers and transmitters in the province.
In answering a question from opposition leader Len Simms at the time, Wells said:
It authorizes the Public Utilities Board to redirect any power - any power, no exceptions - to meet the needs of the people of this Province. Not expropriating anything from anybody. It is to manage the power that is generated in this Province in such a manner as to first and foremost meet the needs of the people of this Province. It makes no specific reference to Upper Churchill. It makes no specific reference to power companies. It makes no specific reference to any individual generator of power.
What it does is establish the principle that the Public Utilities Board has to supervise the management of all hydroelectric power generated in the Province in such a manner as to meet first and foremost the needs of the people of this Province, and it sets guidelines as to what are the principles under which they can do it.
Wells introduced the bill at second reading on March 3 when he described the Act in detail.
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