12 March 2014

Silence is the perfect expression of scorn #nlpoli

by JM and EGH

The BBC online news magazine carried an article on March 10 that should be of interest to all those following the Muskrat Falls debate.

Do massive dams ever make sense?” summarizes the work of researchers at Oxford University.  They studied more than 245 large dams completed between 1934 and 2007. 

A large dam is one with a wall height of more than 15 metres.  Muskrat Falls would meet the study criteria

The researchers found that dams ran 96% over their approved budgets, on average. One Brazilian dam went 240% over budget.  With few exceptions,  the researchers found that the dams were not economically viable.

Principal investigator on the project was Bent Flyvberg, an academic who specializes in megaprojects. He notes that large dams are not green projects.  The amount of concrete involved in the construction alone leaves a huge carbon footprint, according to Flyvberg.

What worse, the projects are difficult to stop even if it appears that initial projections prove to woefully underestimate the costs or overestimate the project benefits.

“A dam is really a useless asset if it's not completely finished. Even if it's 99% finished, you can't use it - it's either on or it's not."

The paper by Flyvberg and two others that contains the research results - “Should we build more large Dams? The Actual Costs of Hydro-Power Megaproject Development” – offers other observations relevant to Muskrat Falls:

  • Three out of four of the dams in the study suffered cost over-runs.  While the average over- run was 96% of the original budget, the median over-run was 27%.
  • Large dams built in every region of the world suffer systematic cost over-runs. Dams in North America fair better, with an average over-run of 11%. The authors note, however, that planners tend to make  insufficient adjustments when extrapolating North American norms to remote areas of the world. Even though it is in North America, Labrador would likely qualify as one of these remote areas.
  • Dams built more recently performed no better on a cost basis than projects dating back 50 years.
  • Larger dams (height, and installed capacity) have generally a higher cost over-run than smaller ones.

After considering all that, recall that Nalcor has not provided updated cost estimates to the public since October 2012. Their silence would tend to validate the clues that the project is already $1.0 billion more expensive than it was in 2012.

To borrow a phrase from George Bernard Shaw, it seems that with silence, Nalcor is showing is the most perfect expression of scorn for the people who will foot the bills for its project.