03 July 2007

Lower Churchill by undersea cable: the 1978 view

This piece might be from the Globe and Mail 30 years ago, but it highlights so much about the megaprojects for Gull Island and Muskrat Falls in Labrador.

First of all, the story by Ralph Surette starts out noting that Gull island is a potential source of power. It still is. Potential. Not imminent. Potential. The project won't change status until building starts and building won't start until the financing is secured and the financing won't be secured with power purchase agreements.

Second of all, note the comments from then-chairman and chief executive Vic Young on the undersea route. Technically feasible? No question. The problem is capital and maintenance costs that would make the power "cost about twice what it would if brought down overland."

It's always interesting to go back into the files and discover how much things haven't changed. Oh yeah. That's another thing. Three decades ago, the Premier of the day and the minister of mines and energy, along with the Hydro executives would have spoken in glowing terms about the development they expected to take place very shortly.

Experience is what makes each of us cautiously optimistic about life and its promises. Optimistic, for sure, but tempered by what has occurred.
Buchanan has a lot to learn before selling hydro power
Ralph Surette
Globe and Mail
Nov 25, 1978

Halifax NS -- BY RALPH SURETTE HALIFAX Gull Island is nothing more than a potential hydroelectric power site on the lower Churchill River in faraway Labrador. But Nova Scotia Premier John Buchanan sees it as tantalizingly close and the answer to the province's long-term electricity problems.

Mr. Buchanan had big things in mind for Gull Island when he delivered one of his first major policy speeches a few weeks ago in the United States, as many Canadian politicians have a habit of doing. He told his audience in Portland, Me., that the Atlantic region had a potential power surplus it could sell to New England. He mentioned coal-powered electricity in Nova Scotia, nuclear power in New Brunswick, Fundy tidal power and Gull Island.


In order to supply both Nova Scotia's long-term needs and be sold in surplus to the United States, Mr. Buchanan saw this Labrador power coming down via submarine cable from Newfoundland to Cape Breton.

But he made the slight oversight of not consulting Newfoundland. He was gently but quickly reminded by Newfoundland energy officials of the difficulties involved in moving Gull Island power anywhere, let alone to Nova Scotia.

For one thing, according to Vic Young, president of Newfoundland and Labrador Hydro, the 77-mile cable across the Cabot Strait is an extremely poor prospect. Although a study two years ago stated it was technically possible, its capital and maintenance costs would be enormous. The electricity delivered would cost about twice what it would if brought down overland.

But the overland route through Quebec has its own set of problems. Newfoundland wants to negotiate a right of way through Quebec. Quebec insists on maintaining the present system in which Quebec would simply buy power at the Newfoundland border and resell it at its other borders at a profit.

The two provinces have been negotiating for a year on the matter. Negotiations are presumably not helped by the fight between the two provinces over electricity from the upper Churchill River. Newfoundland has taken Quebec to court for the right to recall some Churchill Falls power for its own needs. The whole block now is sold to Quebec under fixed contract.

Further, Mr. Young does not see Gull Island, with its 1,800 megawatts of potential power, serving anyone's long-term needs except those of Newfoundland. The power, he says, would be exported only until such time as Newfoundland needs it.

Mr. Buchanan first expected the yet-to-be-created Maritimes Energy Corporation (MEC) could be expanded to include Newfoundland and that this corporation could take a leading role in developing Gull Island.

However, after a round of talks with the federal Government, the premier has settled for the idea that the MEC should purchase Labrador power and nothing more. Meanwhile, Newfoundland and the federal Government are expected to announce formation of a new corporation within the next few weeks to begin the task of developing the Gull Island site.

The problems with delivery have not been ironed out. If Gull Island electricity ever reaches Nova Scotia, chances are it will be neither cheap nor the answer to Nova Scotia's energy problems. But it has to get here first, and Mr. Buchanan may have long since come and gone as premier by then.