The Difference Between Their Dippers and our Tories #nlpoli

When it comes to transparency and accountability for megaprojects, the New Democratic government in Nova Scotia is light years ahead of the Progressive Conservatives in Newfoundland and Labrador

Dexter admits NS didn’t do Muskrat Falls homework

In an interview with The Coast, Nova Scotia Premier Darrell Dexter admits his government didn’t exercise due diligence before signing onto the Muskrat Falls project:

The Coast: Has the Nova Scotia government commissioned any cost comparison between Hydro Quebec and Lower Churchill?

The Premier: The costs with respect to the project, of course, have to be submitted as part of the financing for Nova Scotia Power. That analysis takes place in the same way as any other costs going into their rate requests.

The Coast: But have you compared Hydro Quebec power with Lower Churchill...

The Premier: I haven’t asked the department whether or not they’ve done that work.

Dexter also showed his ignorance of geography.  He told The Coast that he expected the Muskrat Falls power would be cheaper than power from Quebec because it is farther from Nova Scotia than the Labrador power.

Of course, the reason the Nova Scotian government didn’t have to compare costs is because Emera will get the power from Labrador for free.

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The old trading federal cash for a deal with Quebec trick

“This is truly a historic and momentous occasion for the people of our province, as never before have we been granted access through the province of Quebec with our own power.”

That was Danny Williams in April 2009. 

Williams was describing a deal by NALCOR Energy to wheel power from Churchill Falls through Quebec to American markets.

These days you’d hardly know the event happened.

But it did.

The April 2009 deal is the single episode which refutes all the claims Williams has made since then about not being able to run Labrador power through Quebec.

Williams told reporters at the time that the deal

“… shows that our power [in Labrador] is not stranded power," he said.

"We're not forced to just sell it at the border to Quebec at whatever price Quebec wants to pay for it."

Not surprisingly, given its position on a line from Labrador to Ontario, the Government of Quebec preferred this option to a line subsidised by Ottawa.  CBC quoted Quebec natural resources minister Claude Bechard on the April 2009 deal:

"We don't want to have a new transmission grid that will be subsidized by the federal government," Béchard said.

"That's the way that we have to work for the future. That's the way we have to work if we want to keep our capacity in our place."

All in all, Williams most recent attack on Quebec is very odd indeed.

Neither he nor the Nova Scotians should have been surprised by Quebec’s objection to federal subsidies for a new line to Nova Scotia, even if – as in the Nova Scotia line – it has nothing whatsoever to do with the Lower Churchill.

Oh yes, Danny Williams mentioned this might be a way to run power from the Great White Whale to the Maritimes, but NALCOR isn’t really too interested in that very long and very expensive route.

You can tell this because the route it is highlighting to the never-ending environmental review process, the route described connects the two new dams back to Churchill Falls and then to the border with Quebec.  The most recent local media report confirm NALCOR is still using exactly the same development scenario described in the original submissions, which are the same as the project outlines used by Roger Grimes’ crew in 2002, Brian Tobin’s gang in 1998 and every provincial administration back to Joe Smallwood.

And it’s not like Nova Scotia Premier Darrell Dexter doesn’t realise this whole transmission connect to Newfoundland isn’t really about the Lower Churchill either. As Dex put it last January:

Premier Darrell Dexter said he’s not surprised Newfoundland and Labrador is looking for a cheaper option than an underwater cable connection to Nova Scotia for moving energy from Lower Churchill to market.

"The sheer economics of it are undeniable in terms of a transportation corridor for that energy," the premier said after a cabinet meeting Thursday.

If you want to know what this Nova Scotia line is really all about, you have to look nor farther back than April 2009.

That Ontario line and its subsidies went “poof” pretty quickly, didn’t it?

This whole Anglo-Saxon route is nothing more than a bargaining ploy the Old Man is using in his ongoing efforts to get a deal with Hydro-Quebec.

And besides, it’s not like a Newfoundland and Labrador Premier didn’t use Nova Scotia to try and leverage a deal with Quebec for Labrador power before.

Would you believe 1964?

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Lower Churchill, Nova Scotia and NB Power: “The sheer economics of it…”

And it is not like people haven’t said this before:

Premier Darrell Dexter said he’s not surprised Newfoundland and Labrador is looking for a cheaper option than an underwater cable connection to Nova Scotia for moving energy from Lower Churchill to market.

"The sheer economics of it are undeniable in terms of a transportation corridor for that energy," the premier said after a cabinet meeting Thursday.

Read down a wee bit further in the Chronicle-herald story and you get this:

An SNC-Lavalin transmission system study for the Nova Scotia government estimates the cost of connecting Newfoundland and Nova Scotia at $800 million to $1.2 billion. The estimate of connecting Nova Scotia to New England is $2 billion to $3 billion.

Yes, stringing underwater power cables from some point in Newfoundland and Labrador to Nova Scotia would cost at least $1.2 billion.  Initial cost estimates are always low on megaprojects like this. 

But to get to that bit, you’d have to string the long from Gull Island, down to the coast of Labrador, across to the island of Newfoundland down to some point on the southwest coast of the island to get to the bit that costs at least $1.2 billion.

The cost of that plus the line out to Soldier’s Pond near St. John’s would be $2.0 billion or more.

You can tell the Nova Scotia option was never being seriously considered.  There isn’t any plan to do it currently under environmental review.

Now all this too has to make you wonder why Darrell joined in attacking Shawn Graham in New Brunswick. His whole position on this just didn’t make any sense before. And it really doesn’t make any sense now that he admits he knows the whole power line to Nova Scotia is just so much crap.

In fact, Dexter acknowledges the whole thing is crap because he adamantly insists that there’s no way Nova Scotia taxpayers would be on the hook to help build it.

“We’re not going to build it,” he said.

 

Not surprisingly, NALCOR Energy boss Ed Martin is talking about the cost of land transmission through Quebec. Hearings into NALCOR’s application/objections on that front are due to start this week. Land transmission is pretty much the only economically viable way of getting Labrador power out to any market.

The current estimate for building a new set of power lines across Quebec is $3.0 billion.  That’s not bad considering the estimates for the line Soldier’s Pond for a mere 800 megawatts.

You can tell the crowd at NALCOR understand the whole game currently being played.  Look at the way it wound up in the Telegram over the weekend:

Regardless of what happens, officials say the regulator's decisions will provide certainty for Newfoundland and Labrador's energy corporation as it tries to get the Lower Churchill hydro project off the ground.

"We've collected all the information we need," Nalcor Energy president Ed Martin said in an interview.

"This is one of the key pieces left. I'm going to have enough information (after) this to be able to complete my discussions with potential customers."

When people start talking about certainty, then you know they’ve comes to terms with reality.  “At least we’ll know for sure…” should be one of the stages of grief.

For the record and just for all those people who are still over the shock that the line through Gros Morne was a political racket for nothing, let’s get this straight as well.  The provincial government isn’t concerned that Hydro-Quebec is blocking the precious Legacy Project.

At least one person in the government is pissed off that the whole thing just can’t get off the ground for one simple thing:

the sheer economics of it.

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Graham smacks NL local preference policy

New Brunswick premier Shawn Graham has taken a poke at Danny Williams, accusing the Newfoundland and Labrador premier of engaging in cheap publicity stunts.

Graham said it is “ironic” Williams wants an open market for electricity transmission when New Brunswick companies “line up — this is important to note, they line up — behind Newfoundland providers for scraps left by local preferences on construction projects and labour needs.”

Ouch.

According to Canadian Press, Graham also said that the Lower Churchill is 15 years away from development.

All this comes as Graham released his written reply to a letter from Danny Williams and Nova Scotia Premier Darrell Dexter.  The Graham letter is below with the Williams/Dexter letter below that.

NB 1940

Dec. 4, 2009

Dear Premiers Williams and Dexter:

Thank you for your letter of December 2, 2009, regarding the potential for future energy development within the Atlantic region.

I share with you the desire to maximize Atlantic Canada's potential as a developer and supplier of clean, renewable energy for domestic and export markets. Our government is working to maximize New Brunswick's advantage as the energy hub of northeastern [sic] North America and the development of new energy projects across Atlantic Canada is a key element in fulfilling this vision.

New Brunswick is now, and will continue to be, an active partner in promoting the energy potential of Atlantic Canada. Our recent Memorandum of Understanding (MOU) with the Government of Québec does nothing to change that.

Section 3.1(b)(iv) of the MOU explicitly states that any changes to our regulatory structure resulting from agreement with Québec will "expressly contemplate open access to the transmission network in the Province of New Brunswick." The MOU also states in section 2.5 that transmission and distribution rates will continue to be regulated by the New Brunswick Energy and Utilities Board (EUB), a body comprised of New Brunswick citizens and experts in utility regulation, given regulatory powers by the Legislative Assembly of New Brunswick.

Therefore, rules are now in place that set conditions by which electricity can be moved through New Brunswick to export markets, either through use of existing transmission lines or construction of new capacity.

Under the Electricity Act of New Brunswick, any owner of a transmission system must provide market participants with open and non-discriminatory access to its transmission system. The terms, conditions and charges for this access are specified in the open access transmission tariff that was originally approved by the New Brunswick Public Utilities Board in 2003 and continues today under the authority of the EUB. This New Brunswick open access transmission tariff (OATT) is consistent with the industry standards for open access transmission in North America and sets out the obligations for both the provider of service and the transmission customer. All service is to be provided under the tariff and there is no provision for the owner of the transmission system to treat any customer in a preferential manner. In fact, it would be against the law to do so.

Entities in both Nova Scotia and Newfoundland and Labrador are transmission customers in New Brunswick and are taking or pursuing transmission service under the tariff. They have been, and are continuing to be, treated in a fair and non-discriminatory manner.

Please allow me to respond directly to the specific requests stated in your letter:

1. finalize an agreement, by February 2010, prior to signing of the definitive agreements between New Brunswick and Hydro-Québec, subject to normal environmental assessment and permitting, to construct a new interprovincial transmission line through New Brunswick to the Maine/NB border, separate from the existing NB grid.

New Brunswick has always been open to discussions on the potential for constructing additional transmission capacity to meet the projected needs of Nova Scotia and Newfoundland and Labrador. This will not change. As I have stated above, there are clear rules and processes for developing additional transmission capacity for export. If these rules and procedures are followed, additional transmission capacity can be constructed within New Brunswick to meet your future needs.

2. ensure that existing open access applications will be handled by NBSO under existing NB OATT rules until the process is complete and service agreements have been offered to Nalcor Energy or any other Atlantic Canadian companies that may seek such access before the signing of the definitive agreements between New Brunswick and Hydro Quebec next Spring (i.e., grandfathered and handled by NBSO under current rules).

It is a key principle of the EUB that all parties seeking access to use our transmission system be treated in a fair and non-discriminatory way. This request by Nova Scotia and Newfoundland and Labrador would require that preferential treatment be given to specific companies in contravention of the law. This could also jeopardize our standing under U.S. Federal Energy Regulatory Commission (FERC) rules as an exporter of electricity to the United States. I am sure you will agree that this would be contrary to all of our interests.

In accordance with these rules, New Brunswick held an auction in 2008 for excess capacity on the new transmission line connecting New Brunswick and Maine. I note that Nalcor Energy did not bid for capacity at that time. Should Nalcor or any other company require transmission capacity through New Brunswick, long-term firm reservations for transmission capacity can be secured via a request for such capacity or through an open season bid process.

In fact, it is my understanding that Nalcor Energy has been working for some time with the New Brunswick System Operator on a system impact study for a transmission route via New Brunswick. I encourage you to continue with this work. This process, as I have indicated, is compliant with the OATT rules and will remain under the New Brunswick Energy and Utilities Board's oversight, now and into the future.

I believe that the process for negotiating transmission lines must be open and transparent. All parties must have a clear understanding of the rules being applied, with assurances that these rules are applied fairly to all. For this reason, New Brunswick must ask that all parties, including the governments of Nova Scotia and Newfoundland and Labrador, respect these rules and be prepared to make application in good faith within the process.

I understand that you are advancing these requests to promote the interests of your respective provinces. I share with you the desire to build a stronger, more prosperous and self-sufficient Atlantic Canada. I am confident this can be done if we work together and respect the rules designed to ensure fairness for all.

Yours truly,

Shawn Graham
Premier

c.c.: Honourable Robert Ghiz, Premier of Prince Edward Island

09/12/04

And the one that started it:

December 2, 2009
Honourable Shawn Graham
Premier of New Brunswick
P.O. Box 6000
Fredericton, NB E3B 5H1

Dear Premier:

Atlantic Canadians are well served when our provincial governments work together to gain the best possible opportunities for the region as a whole as well as the separate interests of each province. This is particularly true in the energy field, where better connections improve the economic opportunities for each and all provinces in Atlantic Canada It is why our two governments favour a significant improvement in transmission capacity with New England and thus the rest of North America.

We were pleased that the recent Council of Atlantic Premiers meeting in Churchill Falls provided an opportunity for all four premiers to discuss potential impacts of the Memorandum of Understanding (MOU) between the Government of Quebec and the Government of New Brunswick.

We are writing to seek further clarification and to make two specific requests.

We understand your position that New Brunswick’s open access transmission tariff (OATT) will continue to be offered in a fair and nondiscriminatory [sic] manner after the transaction with Quebec is completed. In this regard, you suggest that other Atlantic Provinces will have the same open access to and through the New Brunswick transmission system as we do today.

Assurances that the Federal Energy Regulatory Commission (FERC) of the United States will enforce the OATT and ensure non-discriminatory access to New Brunswick’s transmission infrastructure do not allay our concerns regarding open access. It is through New Brunswick’s regulatory authorities, which have jurisdiction in the Province, that this access can be guaranteed and any issues resolved expeditiously. That is why our governments seek an outline of the process and mechanisms that New Brunswick will employ to guarantee this access.

How will New Brunswick assure other energy producers in New Brunswick and in the other Atlantic provinces that they will have the same level of open and non discriminatory access to the NB transmission system (i.e., to existing surplus capacity or existing capacity with appropriate system upgrades), and to new energy corridors?

Reviewing the MOU, we are concerned with the provisions that eliminate a truly independent system operator, require conformity to the Quebec regulatory system, create difficulty in changing these laws in the future, and narrow the scope of the energy hub from the region to the province. These provisions may enable Hydro Quebec to hinder transmission development, whether it is expansion of the existing system or the development of a new corridor if it is not seen to be in Hydro Quebec’s own interests.

Newfoundland and Labrador’s experience of dealing with a system operator that is imbedded within Hydro Quebec has show that this model can significantly delay decisions (4 years or more) even under an OATT process. It is this experience that leads us to believe the proposed move by Hydro Quebec to take over the NB System Operator (NBSO) role will likely lead to similar outcomes.

I trust this information helps you to understand in greater detail our concerns about the future of open access in New Brunswick, and its effect on development of Atlantic Canada’s renewable energy resources. That is why we are asking the New Brunswick government to:

1) finalize an agreement, by February 2010, prior to signing of the definitive agreements between New Brunswick and Hydro Quebec, subject to normal environmental assessment and permitting, to construct a new interprovincial transmission line through New Brunswick to the Maine/NB border, separate from the existing NB grid; and

2) ensure that existing open access applications will be handled by NBSO under existing NB OATT rules until the process is complete and service agreements have been offered to Nalcor Energy or any other Atlantic Canadian companies that may seek such access before the signing of the definitive agreements between New Brunswick and Hydro Quebec next Spring (i.e., grandfathered and handled by NBSO under current rules).

Thank you for your consideration on this matter.

DANNY WILLIAMS, Q.C.                                         DARRELL DEXTER
Premier of Newfoundland and Labrador    Premier of Nova Scotia

cc. Premier Ghiz

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Darrell Dexter: sucker

From the Chronicle-Herald:

Premier Darrell Dexter had a private meeting Monday with the president of Newfoundland’s energy corporation in an attempt to have electricity from the Lower Churchill Falls hydro project go through Nova Scotia.

Dexter apparently thinks the project is going somewhere and that there is any intention to run a power line through Nova Scotia.

Danny Williams hasn’t even been able to convince Hydro-Quebec to take an ownership stake in the project currently valued – not at $6 billion as claimed by the Herald – but at more like $10 billion. Heck, he even got bitched slapped into an emergency session of the legislature after his legal drafters tried a childish bit of word-play to screw with the 1961 Churchill Falls lease.

On top of that, the province’s finances are apparently so tight they have to cut health care despite having billions flowing in oil revenues. 

There are no – that’s right:  no – customers for the project.  A potential deal with Rhode Island has been buggered up. And that’s something the Premier once described as being “very,very” crucial to the project.

The land claims deal vital to getting the project going is lost in the wilderness.

The timetable on the project has been pushed back repeatedly and there are even rumours swirling now the thing will be sent back for a major environmental overall because the first set of environmental documents submitted to the federal assessment process were grossly deficient.

And, most amazingly of all given Dexter’s efforts to get in at the front end, there just are no plans whatsoever to run a power line from Labrador anywhere near Nova Scotia. 

If the Nova Scotians is fronting any money for this thing or even thinking of dropping cash on the Lower Churchill, he is being snookered, big time.

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