20 August 2012

Fourth time a charm: Kennedy changes MF “key point” …again #nlpoli

How many times should anyone need to change the key point in any discussion?

Well, this past weekend, natural resources minister Jerome Kennedy signalled what is the latest shift in strategic messaging on the Lower Churchill project since October 2010.

On Saturday, he posted this comment online:


For those who can’t make that out, Kennedy said:

Key issue is this – is MF in the best interests of people of NL?  Why would we want to do a bad deal?

The First Version

Back in November 2010, Muskrat Falls was about the Big Picture:

Our priorities have remained steadfast; that is to achieve maximum benefits for our people, and to secure stable rates and markets with a good return for the people of this province. … Today marks the beginning of a new era of Atlantic Canadian cooperation and together we are telling the marketplace both in Canada and the United States that badly needed competition in the hydroelectric marketplace is on the way.

That’s primarily about export sales, in case you missed Danny Williams point.  You have to wait for the quote attributed to Kathy Dunderdale to see a mention of “clean, reliable source of power which [sic] ensured the long-term stability of power rates”.  That was a reference to the argument that Lower Churchill electricity would allow Nalcor to replace Holyrood for environmental reasons.

A couple of weeks later, Dunderdale was Premier.  In her first speech in the new job, she picked up the export angle.  Dunderdale said Muskrat Falls was “a project that promises to establish Newfoundland and Labrador as a green-energy superpower in North America.” 

The Second Version

By the following spring, though, the rationale for Muskrat Falls had changed.  The throne speech described the project this way:

This project is the lowest-cost, long-term option to meet our growing electricity demand. What's more, Muskrat Falls will mean consumers' electricity bills will be stable for years to come, and lower than if the province had chosen the alternative: a future dependent on more thermal generation and exposure to volatile oil prices.

Exports gone as was the need to replace Holyrood.  Instead, Muskrat Falls is about meeting a growing demand in a way that was not tied to the risk of increasing costs due to "volatile oil prices”.

The speech made it plain where this came from:

My Government, with its comprehensive Energy Plan, charted a course for energy security. The objective was clear: long-term stability for the electricity ratepayers.

From an emphasis on energy exports, the government changed its strategic message about Muskrat Falls to one that focussed entirely on its domestic role. 

The throne speech also referred to the possibility that at some point in the undefined future, “[t]he combined Upper Churchill recall, Muskrat Falls and future Gull Island power will provide the storehouse of renewable energy to fuel industrial growth in Labrador.”  Industrial growth, incidentally, has traditionally been political code for manufacturing.  In the Labrador context,  proponents of industrial development have typically used it to mean something like an aluminum smelter.

The Third Version

By the time the whole thing got to the public utilities board for a review, things changed again.  As natural resources minister Jerome Kennedy described it in May 2012:

Do we need the power? If so, what is the best way to deal with the issue for the need for power? What is the lowest cost option?

Sadly for Kennedy, Nalcor obviously couldn’t answer the questions.  The joint environmental review panel ruled in 2011 that Nalcor couldn’t justify Muskrat falls on the basis of need.  Several presenters said the same thing to the public utilities board during its review.

And as for the lowest cost option, the public utilities board review made it clear that Nalcor had not reviewed alternatives before it launched into the Muskrat Falls project.  Kennedy himself confirmed Nalcor hadn’t done the reviews when he announced that his department would hire consultants in 2012 to review alternatives.

The Fourth Version

It’s not surprising, then, that Kennedy and his colleagues are shifting the basis of the Muskrat Falls discussion yet again. Kathy Dunderdale already floated this idea out there in May when she asked Randy Simms, rhetorically:

“Why would a government want to develop a project that is not in the best interest of the province?”

The earlier versions of the government argument for Muskrat Falls could all be demonstrated factually. Experts can describe growing demand and present charts and graphs to back their evidence.  “Lowest-cost” is also something proponents could show with facts.  The argument is a simple, three-step affair:

Step One:  State the case -  We need Muskrat Falls to meet growing demand.  It is the lowest cost option.

Step Two:  Present Evidence – Show demand charts.  Explain the basis for the projects.  Show cost comparisons of alternatives.

Step Three:  Draw logical conclusions.

Since the provincial government and Nalcor can’t do any of that, they have now switched the basis of the argument.  They will now try to justify Muskrat Falls based solely on their own intentions.  Muskrat Falls, so their argument will essentially go, is the right choice because the people who back it want to do good things. They would never knowingly do anything wrong.

That shows you how far the project proponents have come in their battered course to try and win support for their decision in 2010. They failed repeatedly on the basis of facts and evidence.  people accept the facts and evidence presented by opponents.  Having failed at all other lines of reasoning,  the government must plead their good intentions. 

Not surprisingly, therefore, they also want to attack other people’s motivation.  Opponents of the project are all “politically motivated”, according to Kennedy.  He and his associates have tried to make attack project critics by casting aspersions on their intentions.  We are good, they say, in essence.  All others are bad;  you cannot trust them.

The problem with the good intentions argument is that it is meaningless.  Politicians who have approved all sorts of hugely expensive megaproject disasters didn’t wake up one day and say:  “Let’s do something monumentally stupid.”  They all believed firmly that what they were doing was right and that their decision was in the best interests of the public.

And yet they still shagged up.

The gang at Brinco didn’t start out to make a mess of Churchill Falls.  In fact, even in 1969, it seems they thought their project would work out quite nicely for everyone involved.  They weren’t alone.  Lots of people in the province agreed with them.

And yet, their good intentions and the good intentions of hundreds of thousands of people did not stop the fiasco.

People don’t set out to make bad decisions.  That doesn’t stop them from making horrible mistakes for one reason or another or another or another

Kennedy’s re-framing of the discussion isn’t looking too good.  They haven’t been able to demonstrate on the basis of evidence that Muskrat falls is the right thing, that it is in the best interests of the province.  And, the best they can do on the intentions question is a hearty “so what?”

The history of the argument for Muskrat falls so far would make you wonder if Kennedy and his colleagues will have to redefine the project rationale for a fifth time.