30 August 2011

Muskrat Falls: lost opportunity


The claim: 

Nalcor stated in its final submission to the Panel that without the Project the Province would lose an opportunity to create long-term revenue to fund social programs. [Joint Review Panel, final report, Page 18]*

The reality:

Further, Nalcor indicated at the hearing, … that the shareholder [i.e. the provincial government] might forgo dividends so that not much of a revenue stream is expected from Muskrat Falls for distribution. [Page 24, Emphasis added]

The only ways the provincial government can make any money from Muskrat Falls is if it takes dividends from Nalcor, if it claims rent from the water lease, or if it taxes electricity production.

The provincial doesn’t take dividends from Nalcor at the moment.  Odds are it won’t if the provincial government carries on with the Muskrat Falls project.

So far there are no plans for electricity taxes.

And while the details of the water lease aren’t public, the provincial government could also simply let Nalcor have the water rights with a very small rental charge, if it imposes any rental at all.

So how – exactly – will Muskrat Falls create “long-term revenue to fund social programs”?

- srbp -

Note:  the full report doesn’t appear to be online. The executive summary is available for the Canadian Environmental Assessment Agency.

Update:  The full report is online.  No fewer than three e-mails (including one comment) gave the link.