Coo-coo for Connie Puffs

yes, those busy little political beavers in the Confederation Building are still obsessing over certain questions on VOCM’s question of the day.

They learned their Danny-lessons well.

The latest question to get goosifed was one about the Conservative leadership race and the back-room deal Brad Cabana is fighting to bust wide open.

10,616 clicks, 80% of which went in the “no” column for a question asking if Brad should be allowed to run for the Tory leadership.

Now in all likelihood the past practice holds, which means that tax dollars in some government office got spent paying some staffer or bunch of staffers to bust up a computer mouse casting these “votes”.

But aside from displaying a pretty shagged set of priorities, this little display does illustrate the lengths to which the back-room boys over at Connie headquarters are prepared to fight off any attempts at bringing modern democratic ideas inside the Bunker that Danny Built. Hisself’s legacy is apparently too precious to throw away on such frivolities at fair voting, open membership and debate free from intimidation and afternoon visits from executive  assistants.

It’s a pretty sad commentary on how far the once mighty and respected party has fallen lately. The only thing sadder would be the plants clogging up comments sections defending the party’s anti-democratic bent.

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Coincidence?

Auditor General criticises a department.

Minister got shuffled in a surprise move in January.

Bear in mind that the provincial government knew the contents of the Auditor General’s report long before the public did.

Department of Child Youth and Family Services: 

As a result of issues with the delivery and monitoring of the [long-term protection] LTP component of the [protective intervention program] PIP we determined that there was an increased risk that harm may occur to children.

Kathy Dunderdale suddenly shuffled Joan Burke, who had headed the new department from its creation two years ago, back to head the education department.

Meanwhile in another part of the report …

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Irresponsible Government League: free-wheeling in Dunderdale’s department

From the Auditor General’s most recent report on the provincial government’s handling of public funds, released on Wednesday:

As at 19 March 2010, the EMS identified that 56 (12.0%) of the 465 recreational vehicles were missing.  We also found that 49 of the 56 missing recreational vehicles were assigned to the Department of Natural Resources.  

We note that the 2006 Report referred to 80 missing recreational vehicles and indicated that "To have this number of machines unaccounted [for] is unacceptable and increased monitoring of both ATVs and snow machines is strongly recommended.” The Report noted that 67 of the 80 missing recreational vehicles were assigned to the Department of Natural  Resources and the Department of Fisheries and Aquaculture.

Yes folks, Premier Kathy Dunderdale’s former department lost 49 snowmobiles and all-terrain vehicles and that accounted for 87.5% of the government’s inventory of missing ATVs.

How do you lose a snowmobile or a quad?

Well, sez the purist, the vehicles aren’t really lost. It’s just that the department officials don’t know where they are.

For those of us paying the bills, that lousy record keeping and the poor management practices that go with it still pay for all that waste in government.

Meanwhile, 49 somebodies may well have sweet rides courtesy of your tax dollars.

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Same and different: Alberta and NL Conservatives’ leadership issues

Alberta premier Ed Stelmach is leaving politics in the face of a revolt within his caucus, according to the Globe and Mail.

Kyle Fawcett, a first-term MLA from Calgary and one of the more fiscally conservative in his party, acknowledged there were cracks in Mr. Stelmach’s cabinet.

“I do think that there was a bit of an issue in caucus,” he said. “There were some challenges around, obviously, this upcoming budget, and some promises that had been made. And I think the Premier saw that as an obstacle that maybe he didn’t want to tackle at this point in his life of public service.”

The unexpected news on Tuesday makes for some interesting comparisons with events in Newfoundland and Labrador over the past couple of months.

Danny Williams left politics unexpectedly in early December.  

Unlike Stelmach, Williams wasn’t facing any obvious internal political problems although he did drop hints of difficulties within his caucus.

Like Williams, Stelmach left politics with the accusation that the opposition parties would employ American-style political attacks in the upcoming provincial general election. Unlike Williams, Stelmach wasn’t a hypocrite in making such a comment.  Williams used Republican-style politics for his entire political career.

While the Conservatives in Newfoundland and Labrador cooked up a backroom deal to avoid a leadership contest, their Alberta brothers and sisters can look to a quick contest among several cabinet ministers that could be over by the end of March.

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Don’t shoot! They’re short

Of the 16 by-elections since 2003, the provincial Conservatives have set a mere 22 days for campaigns in all but three.  The minimum required under provincial election laws is 21 days.

In two of those, the campaigns lasted 23 days and in one the campaign was 24 days.

The current campaign in Humber West fits the pattern to a tee.

The Conservatives have also been super-speedy in calling by-elections.  In three – Exploits, Port au Port and Humber Valley – the writ for the by-election came the same day the incumbent vacated the seat.

But at 52 days after being vacant, Humber West is the third longest time the Tories have taken to call a by-election They took 61 days to call Cape St. Francis, 60 days to call Baie Verte,

The maximum time to call a by-election under election laws is 60 days.

The others range between three days for the Straits-White Bay North to 48 days for Placentia- St. Mary’s.

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One sign of the political Apocalypse

Seen around the Internet:

I am not confident, based on the government's past record that they have a plan to diversify the rural economy and that concerns me. It will take leadership, innovation, commitment and ability. I am not sure that those traits have been applied to the job in a while.

That comment, from one of Danny Williams most strident supporters, is an damning criticism of Williams’ and his Conservative Party in power.

Are the locusts and hailstorms far behind?

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The Basenjis of St. John’s

If there are dogs that won’t hunt, the Conservatives members of the House of Assembly representing seats in the metro St. John’s are the kind that won’t bark.

Back-bencher, cabinet minister or parliamentary secretary, they are all sitting idly by as the current administration demolishes the school system in the metropolitan area. 

Thousands of students will suffer as a result of a poorly conceived and clumsily executed backroom deal between Eastern School District and the province’s education department to close schools and move students into lashed up space.

The school district will unveil a bunch of resolutions to implement the department’s plan tomorrow night.  If you go by the versions that have already circulated to test what will get a majority, the school board trustees plan to ignore the thoughtful comments made by parents across St. John’s that oppose the back-room scheme and propose instead the plan already agreed upon by parents themselves in 2008. 

There are huge problems in the scheme.  For example, under the deal, the city core and downtown area will be left without a school of any kind.  Students will have to be bussed across town.  In another area, hundreds of students will be forced to change schools four times in five years until the provincial government finishes a new high school in the west end.

If they finish it.

If the school doesn’t get finished, the students will languish as refugees in sub-standard facilities.

The very idea of those things would be ludicrous even as a response to a disaster.  Parents across St. John’s are gob-smacked that bureaucrats and politicians would deliberately plan to implement such a hare-brained scheme and dare to defend it.

But the fix has been in since well before Christmas. Trustees, the majority of whom are from outside St. John’s, are already in favour of the scheme.

Portable classrooms are reportedly on the way to house students from one junior high school who will be forced into grossly inadequate facilities for an unknown period of time.

Not a single member of the province’s legislature from the metro area will speak out to support their constituents.

That’s not a prediction.

That’s a guarantee.

Just watch.

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Chevron announces find offshore Africa

From Chevron’s news release:

“SAN RAMON, Calif., Jan 25, 2011 -- Chevron Corporation (NYSE: CVX) today confirmed discoveries within the Moho-Bilondo license in the Republic of the Congo.

The Bilondo Marine 2 and 3 wells are located approximately 40 miles (70 kilometers) offshore of the Republic of the Congo, in 2,600 feet (800 meters) of water in the central part of the Moho-Bilondo license.

George Kirkland, vice chairman, Chevron Corporation, said, "These discoveries further demonstrate the potential of West Africa where Chevron has made significant investments to develop new energy resources."

Bilondo Marine 2 and 3 were drilled to a total depth of around 6,000 feet (1,800 m). The Bilondo Marine 2 (BILDM-2) well found 253 feet (77 m) of gross reservoir, while the Bilondo Marine 3 (BILDM-3) well, which had a different reservoir as objective, found 144 feet (44 m) of gross reservoir. Both wells were successfully tested and flowed oil.

"We look forward to continuing the work needed to further evaluate these discoveries and potential development options," said Ali Moshiri, president of Chevron Africa and Latin America Exploration and Production Company.

The discoveries follow two previous successful exploration wells, Moho Nord Marine-1 and 2, drilled in the permit area in 2007 and the positive appraisal wells Moho Nord Marine-3 in 2008 and Moho Nord Marine-4 in 2009.

The permit area's deep-water Moho-Bilondo project began production in April 2008 and is currently producing 90,000 barrels of crude oil a day. Chevron's subsidiary holds a 31.5 percent interest in the permit area with partners Société Nationale des Pétroles du Congo (15 percent) and Total E&P Congo (operator and 53.5 percent).

…”

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Stelmach bails

Alberta premier Ed Stelmach is leaving politics.

The Alberta Conservative party will hold a leadership convention to replace him before the end of March, 2011.

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Unsound public finances: pork-barrelling on steroids

If it wasn’t for oil prices, the provincial Conservatives wouldn’t have anything to crow about when it comes to public finances.

And since they have no control over the price of oil, you don’t need to be a rocket scientist to understand that building their budget plans on oil prices is something bordering on insane.

You can see that insanity by looking at a chart from the Auditor General’s recent report showing the provincial government’s budget surpluses and deficits.

Three things:

1. Remember the fiscal year numbering thing – The AG misreports the year. To find the actual fiscal year, knock one off.  In other words what the AG calls 2010 is actually 2009.
2. These are accrual or accounting surpluses.  If you look at the actual cash performance, there are some chunky deficits in these years.  Like 2009 for example when the provincial government had to take about half a billion from its cash reserves to cover that whopper of a deficit. Ye olde e-scribe wrote about this before  - in 2008 - along with a couple of lovely pictures to illustrate the point.
3. Those gigantic surpluses in the chart weren’t planned.  In fact, if they planned anything,  the current provincial government crowd planned on going in the hole.  They came out in the black because oil went to insane prices. Look at the budgets for those years and you will see that Tom Marshall and his colleagues planned gigantic spending deficits.

Take 2007, for example.  According to the budget for that year, Tom Marshall planned to come up short by $1.2 billion.  The year before he actually came up short on cash by $707 million.

While you’re at it, these charts also explode the latest bullshit bomb finance minister Tom Marshall’s been spreading now that the Auditor general’s report is on the street.  According to Tom there was a plan, tons of fiscal responsibility and then temporary deficits to make sure the nasty old recession stayed away from our shores.

If you reflect on the actual budget history of the Williams administration, you will see that only real difference between 2009 and all the years before isn’t that 2009 was a year of “stimulus”.  It actually follows the established pattern of planned overspending. 

What changed was the world price of oil. In 2009, the provincial government’s budget forecast and the actual average turned out to be pretty much the same number. 2010 might not be far off that experience, at least as far as cash flow goes.

And that “stimulus” spending?  Well about half of it was actually stuff the provincial government just couldn’t deliver two or three years before when they first promised it. The packaged it up and called it “stimulus” but it as really something a lot less impressive than it sounded. It was, however, a typical Fernando announcement:  it looked a lot better than it actually was.

The provincial government has spent the last seven years spending public money. 

Lots of it. 

At umpteen times the rate of inflation. 

And they started unsustainable spending long before the world went into a recession.

If they had a plan, it certainly wasn’t to spend responsibly, reduce the public debt and generally look after things for future generations.  In fact, if you look at how much they spent and what they spent it on, it looks like old-fashioned pork-barrelling on steroids.

All that puts the current provincial administration is an especially hard spot.  Politically, they won’t be able to start fixing the problems they’ve created. There’s the election and then, if they win in October, they’ll have to settle the leadership thing.  They can really only carry on with the spendthrift ways they’ve followed for the past seven years.

At the same time, politically, the public is now clued in to the problem, wise to the government torque and looking for the sort of serious leadership decisions that the Conservatives can’t really deliver.

Not exactly the greatest situation to be in with an election coming in a few months time, is it?

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A country apart? More like a world apart

In British Columbia, two of the province’s major political parties are holding leadership contests.  There’ll be lots of debate and discussion.

Meanwhile on the other coast, one of the province’s political parties is desperately trying to make sure its secret backroom deal holds together so they can avoid any debate at all.

And the guy the back room boys are trying to keep out of their private clubhouse is vowing to fight what he calls the “feudal“ politics of the province’s ruling Conservatives.

The drama is national news.

Embarrassing national news.

Danny Williams’ successor is busily making sure Newfoundland and Labrador isn’t seen as the youngest, coolest province.

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Unsound public finances: Tom Marshall’s travesty

 

"It would be a travesty if we don't use this windfall we have, this oil — which will be gone one day — if we don't use that to get rid of this massive debt that our people and our governments have accumulated."

That was finance minister Tom Marshall late last year when he released the provincial government’s financial update for Fiscal Year 2010. He made the comment to CBC’s Jeff Gilhooley during a live interview.

Auditor General John Noseworthy’s most recent report on the public accounts (for Fiscal Year 2009)  pretty much demolishes Marshall’s claims that he and his fellow Conservatives have been managing the province’s finances in a sound way.

The chart shows debt expenses by fiscal year over the past decade. Incidentally, just to make sure you don’t get screwed up in this and subsequent posts, notice that the Auditor General mislabels every fiscal year.  The period covered in this chart is from 1999 to 2009.  That’s the way your humble e-scribbler will refer to the dates.

This chart shows just exactly how much money the provincial government spends every year to service the public debt.  Very little of that is actually going to pay off a debt.  The overwhelming majority of that money goes just to pay the interest that comes due every year.

Take a good look at those numbers.

In 2009, the provincial government spent the better part of a billion dollars doing nothing but paying interest on outstanding debt.

Those figures also tell you that what the province’s finance minister and even the Auditor General call “net debt” isn’t really the measure of public debt that you should be fixed on. After all, if the provincial government really had reduced public debt by almost three or four billion dollars, we wouldn’t be back paying debt servicing costs the likes of which the government hasn’t seen since 2001.

The number you need to look at is gross debt, or, as the Auditor General labels it in the chart below:  “liabilities”

That shows the total amount owed now and in the future by the government and its corporations and agencies.  When it comes to figuring out interest payments and so on, that’s the figure the banks and other creditors look at.  Think about it for a second:  if you have a mortgage on your house, the bank doesn’t check every year to see how much cash you have in the bank or anything else to figure out the interest payments you need to make on the loan.  They just know how much you borrowed and what rate of interest they are going to apply.

So when you look at that line called “liabilities” you will see that the provincial government had $13.733 billion in 2004 – the first full year the Conservatives were in power – and owed $12.559 billion five years later.  Not surprisingly, the debt servicing costs in 2009 were not far off what they were way back before Tom Marshall, Jerome Kennedy and the rest of the provincial Conservatives worked their supposed financial miracles.

Take a look at these two charts and you’ll know why your humble e-scribbler has been harping on this point for pretty well the whole span of Bond Papers. Paul Oram’s resignation in the fall of 2009  - note the year! -just highlighted the issue.

Take a look at those numbers and you’ll understand why Tom Marshall simply has no credibility when he talks about his administration’s management of public finances.

And if you look at those figures you’ll understand that, even if the Muskrat Falls deal was brilliant – and it isn’t – the provincial government has far more pressing issues to deal with rather than build someone’s political legacy. That deal would take the gross debt from $12.5 billion to between $17 and $18 billion.

Tom Marshall’s already given us a judgment of his own performance as finance minister:  a travesty. They haven’t reduced the public debt to any appreciable degree.

So what would it be if the same guy and his cabinet colleagues then increased the public debt by another 50%?

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NL Auditor General notes poor fin mgt practice

From September 2002 until March 2009, Government had been preparing periodic financial statements to show the Province’s results of operations and financial position.  Officials of the Department of Finance indicated that these financial statements were only distributed to the Minister of Finance/President of Treasury Board, other Treasury Board Ministers, the Deputy Minister of Finance, the Comptroller General, various officials of the Department of  Finance, and the Auditor General.  Officials of the Department of Finance advised that for the year ended 31 March 2010, periodic financial statements
were only distributed to the Deputy Minister of Finance.

From the Auditor General’s report on Fiscal Year 2009.

No wind, please. We’re Nalcor.

The Telegram reported on Saturday that the provincial government’s energy company isn’t really interested in developing wind energy until after they get the hugely expensive Lower Churchill up and running.

Oh yes, and they also want to sell power to Ontario some day in the misty future despite the crowd up along having a bit of a glut of power.

Regulars readers of these e-scribblers will find the first one to be a gobsmacking revelation of the magnitude of finding out that Liberace was gay.

The second one’s just funny because it really a case of Nalcor putting a very brave face on a very badly bungled job.  After all, they rejected flatly Ontario’s interest in building the project five years ago. 

Then after another five years of trying desperately to interest Ontario, Quebec and anyone in northeastern North America with a electric socket in the power they came up with nothing other than this brilliant plan:

• make the people of Newfoundland and Labrador bear the entire cost of the project and,
• let Nova Scotians get 35 terawatt years of electricity for free.

And it is funny. 

Your humble e-scribbler doesn’t relish the thought of the New Brunswick- like electricity prices that are headed to consumers on the island – guaranteed to at least double within the decade – and the extra burden of hauling around all that public debt but what else can you do but laugh?

If you didn’t laugh at the sheer stupidity of the idea, you go completely off your nut.

Heck, you might even believe that the Conservatives were seriously interested in sound management of the province’s finances.

Right. 

Laughter it is, then.

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Watton to carry Liberal banner in Humber West

Corner Brook native Mark Watton wants to represent the people of Humber West in the House of Assembly.

He has the Liberal nomination.

And he’s got a pretty good line:

…do people want a PC government that’s going to be one seat bigger or do they want a PC government that’s going to be one seat more accountable?

 

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Black Smoke Traffic

For the week of January 17 to 21, the top 10 Bond Papers stories as chosen by the readers:

1. Tory angst may be well founded
2. Tim Powers?  Rick Hillier?  No thanks say NL Tories
3. AbitibiBowater properties up for sale
4. Ontario flush with electricity
5. Non-res building up 23% in Q4
6. No power cable for PEI?
7. Fin minister Tom Marshall talks debt reduction – audience pees in pants with stifled giggles
8. Fisheries agreement delayed again
9. Iceland opportunity lost
10. New gas find offshore Israel

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Mill shelves controversial tire burning proposal on eve of by-election

Corner Brook Pulp and Paper quietly shelved a controversial proposal to burn tires as part of the mill’s power generation on the eve of  a provincial by-election.

Word came late Friday in a routine statement from the provincial environment department on applications under environmental protection laws.

The provincial environment minister was supposed to rule in December on a proposal from the west coast paper mill.  The provincial government postponed that decision to January 15 claiming that it had received more public submissions on the project than it could handle by the initial deadline.

While the initial announcement of the proposal met with little public reaction, a series of protests, letters to the editor and a Facebook campaign made it clear some area residents strongly opposed the tire burning idea.

The second deadline came and went with the excuse that the minister newly appointed on January 13 needed time to review the proposal.  Shortly afterward, the minister’s office indicated he’d have an announcement by week’s end.

The decision to shelve the proposal comes on the eve of a by-election to fill a Corner Brook seat in the provincial legislature vacated by Danny Williams, who quit politics in early December.

Both opposition parties pledged to make the proposal a key issue in the by-election but by Friday only the Liberals had a candidate to face the Conservatives.  Mark Watton, a lawyer who had previously been a political staffer in the Prime Minister’s Office and chief of staff to cabinet minister Ken Dryden, is expected to be the only person to seek the Liberal nomination that closes on Friday.

On  Wednesday, high school principal Vaughan Granter won the Conservative nomination.

Friday’s decision by Corner Brook Pulp and paper doesn’t necessarily remove the tire proposal.  The mill could bring the proposal back after the by-election.  At the same time, the provincial environment department ships used car and truck tires to facilities in Quebec for burning.

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Fin minister Tom Marshall talks debt reduction - audience pees in pants with stifled giggles

According to voice of the cabinet minister, provincial finance minister Tom Marshall is interested  - again – in talking about the provincial debt.

Here’s a excerpt from the VOCM online story, quoted here since it may have been disappeared by the time this gets posted:

Marshall proposes several measures in doing so. First, the government needs to balance sustainable and prudent spending with the implementation of steps to lower taxes and net debt. He says the province has to maximize the benefits from its non-renewable resources now so that it is prepared for when they are depleted. Finally, he argues that it is important to diversify the economy, such as focusing on the Lower Churchill Project.

Marshall’s talked about sustainable spending before but only to the extent of making clear he wasn’t the teensiest bit interested in actually doing it. In fact, Marshall’s record is of a profligate spender who never met a deficit he didn’t like.

And just to get the point across, note that current provincial gross debt is about $12 billion.  That’s roughly where it’s been for the past four years and it higher than it was in 2003 when Marshall and his crowd took office. 

Tom mentioned lowering the net debt.  Well in order to do that he’d have to stop overspending as he’s done the past two years.  According to the most recent financial statements, the province’s net debt went up in 2009 and it is set to go up again in 2010 (the current fiscal year) if current trends hold.

So while that whole “sustainable and prudent spending” thing is a great objective, Tom and his friends haven’t done it yet.  After seven years, Tom’s got to have cajones the size of watermelons to talk about debt reduction and fiscal responsibility with a straight face, expecting the people in the province to take him seriously.

Ditto the part where he talks about maximising benefits from oil and minerals.  Tom and his former boss specifically rejected any suggestions to set aside sovereign wealth funds, real debt reduction and any other ways to accomplish the goal of putting the money from oil and minerals to work for the future.

And double ditto for the bit about diversifying the economy.  The current fragile state of the provincial economy is a direct result of provincial government policy since 2003. 

That leaves the Lower Churchill.

Reducing net debt, right?

Okay, Tom Marshall’s current plan is to force taxpayers to borrow at least $3.0 billion and put a total of about $6.0 on the provincial government’s gross debt load.

Tom also wants ratepayers in the province to accept electricity rates roughly double what they are currently to pay for electricity.  Can you say “uncompetitive” boys and girls? 

And he’d like to ship power free to Nova Scotia for 35 years.

Surplus power would enter the market at uncompetitive rates so the chances of export are pretty much slim and none as it now appears.

Given all that’s going on in the province and what Tom Marshall and his pals have actually done since 2003, the finance minister’s audience on Thursday must have peed in their pants with stifled laughter as he rambled on.

Surely no one would take Tom seriously, not with all the evidence against him.

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No power cable for PEI?

Federal transport minister Chuck Strahl said Thursday the federal government won’t be helping the province fund an electricity line from the island to the mainland, saying that the project didn’t make the province’s own Top 20 priorities.

The provincial government is trying to secure funding for the project through a federal green infrastructure fund.

According to the Charlottetown Guardian:

Prince Edward Island isn’t the only province looking for an electrical cable.

The $1-billion green infrastructure program has already funded an electrical cable in British Columbia at a cost of $440 million. The federal government picked up $130 million. The program also funded a $160-million power cable in the Yukon. The federal government picked up $71 million.

Newfoundland and Labrador and Nova Scotia have a joint application for a cable between those two provinces. That mega-project will cost between $800 million and $1.2 billion. They’ve asked the federal government for $375 million.

Strahl said he recognizes the province wants to construct the cable and the federal government is working to find the money to fund the project.

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Ontario flush with electricity

And so much for that market for Lower Churchill power…

Ontario residents were bemused to discover that on New Year’s Day 2011, on average, they were paid to use electricity.

If that seemed unusual – and it is – it’s only the start.

Within the next two years, the conditions that produced the bonus New Year’s power could crop up about one day in every seven, according to an analysis by the agency that runs Ontario’s power market.

A big reason: about 5,000 megawatts of wind powered generation is due to be connected to the Ontario grid in the next few years, producing surges of power that are more than the province needs.

via Toronto Star

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