From: Sent: February 27, 2012 8:59 PM To: PUB Muskrat Falls Review Subject: Submission re Review of Muskrat Falls Proposal Attachments: Concat.docx The attached file has been compiled as a concatenation of editorials, opinion pieces, and letters to the editor of the St. John's newspaper, The Telegram, which reflect negatively on the Muskrat Falls project that is now under review by the Board. The period encompassed in this compilation is from June 1,, 2011 to February 27, 2012, which period was limited primarily by the failing stamina and eyesight of the compiler. The number articles included is 119 which have been organized in reverse chronological order. The number of articles which appeared during the same period and which expressed positive opinions about the project was, 15, of which 9 were submitted either by executives of Nalcor or by Government ministers. These latter articles were not included in the file. The material is submitted with the expectation that it will become part of the record of the current review. The process has been cleared with The Telegram with respect to possible copyright issues. ‐‐ 1 27 Feb 2012 The Telegram (St. John’s) BY ANTHONY SPARROW JR. Anthony Sparrow Jr. writes from St. John’s. Not the time for Muskrat Falls I want to express my opposition to all of the misguided Muskrat Falls apologists out there who are holding fast to the mad Dunderdale-approved notion that this major hydroelectric development must be undertaken and that it must be undertaken now. The Lower Churchill roared long before we settled these lands and it will continue to roar long after we are all gone. If we can leave well enough alone, that is. There is absolutely no reason for the government of Newfoundland and Labrador to hastily put our financial future on the line, at this very moment, to develop a timeless resource. If prospects improve in the future, and it is judged to be feasible to proceed with such a costly public endeavour, then we can responsibly invest in Muskrat Falls at that point with a clear conscience. Allowing an expensive rush job to occur, however, by accepting anything less than full scrutiny and thorough independent analysis of the project is simply not advisable. It merely accepts utter recklessness from those in power who are in pursuit of temporary political traction. To date, the ruling provincial government has amply displayed such an arrogant level of shortsightedness. Our population is aging and headed towards a steep decline in the years to come. Our fishery, the raison d'etre of rural Newfoundland, is in peril and worsening by the day. Our heavy industries, namely the Corner Brook paper mill, are in serious jeopardy. To top it all off, our current economy is dangerously dependent upon poorly managed, short-term oil royalties and our cost of living in the capital city is increasingly overinflated. These are not conditions conducive to borrowing $6 billion for a cure-all energy megaproject. Add in the possibility for major cost overruns and it is clear that we’re risking the future of our province. The reality is that we have no guaranteed markets for our hydroelectric energy. We are also vulnerable to the wider implementation of hydraulic fracturing and the vagaries of future technological developments that may or may not make other unforeseen options much cheaper than our taxpayer-subsidized hydro. The people of our province may end up footing the bill entirely — it actually seems far more realistic that we will face such turbulence than to blindly accept the happy proposition that we shall soon break even and prosper. Let's not forget that the West, led by the United States, has unprecedentedly fallen from grace in the past decade and continues to be mired in economic and social turmoil. No one can predict the turns that we shall take in the decades to come, but the future is certainly going to be unkind to debtors — no matter how much unsold surplus energy they generate. If former Premier Brian Peckford, of Sprung Greenhouse infamy, is warning his fellow Progressive Conservatives to slow down and take steps to avoid wasting public funds, then we should all take pause and accept some advice. Here is a man who has had to cope with the fallout from some costly, ill-conceived ideas of his own. His latest concerns are sound and hindsight provides him with a unique perspective; I think, however, that we should all demand more accountability from the government on this important file and not rely upon the voice of past leaders to fight our battles. I am personally confident that Newfoundland and Labrador can find sustainable solutions to our grid woes through gradual implementation of alternative energy options, such as small-scale hydroelectricity and wind power. We need to stop looking for overnight solutions. Even if the costs are higher up front for more modest development projects, if we can avoid the potentially devastating effects that excessively increasing our debt load may have on future generations, then we will have done our part as good citizens. Bigger is not always better and that mantra certainly applies to financing, as evidenced by the 2008 economic crisis. Independence and self-reliance are noble virtues in and of themselves, but I don’t think that’s what the Muskrat Falls cause is all about. Developing Muskrat Falls is about childishly getting “the better” of Quebec and giving a few dozen overpaid and underworked Tory politicians a sense of accomplishment. If this project goes through and proves to be yet another boondoggle, posterity may not remember the individual names of those responsible, but I promise that their collective recklessness with the public purse will not be forgotten. 25 Feb 2012 The Telegram (St. John’s) Gabe Gregory writes from Portugal Cove-St. Philip’s. Questions without answers Now that the Public Utilities Board (PUB) has begun its public hearings, it is enlightening to read the comprehensive presentations from independent sources on the Muskrat Falls proposed development. It is encouraging that already, the PUB is receiving valued input and thoughtful analysis that will help the board make an informed judgement on behalf of the people of the province. It is noteworthy that the PUB has already informed the public that it has not been afforded adequate time to conduct as thorough analysis as is deemed necessary. Government has decided not to extend the timeframe. Consequently, the public should be concerned that not enough independent analysis will be conducted as is necessary to provide advice on this most important investment in our province’s history. The presentations of Manitoba Hydro International (MHI) and Messrs. Ron Penney and David Vardy have clearly and objectively informed the PUB of some of the shortcomings and weaknesses in the analysis of Nalcor. Some of the highlights of their analysis include: Electricity demand: the impact of the closure of two pulp and paper mills on the demand for electricity has not been accounted for in the demand forecast of Nalcor. In addition, Nalcor has assumed that the third mill at Corner Brook will remain operational over the life of the analysis (to 2067). This is a very significant assumption, in that 981 GWH, or 13 per cent of the total load, of electricity would be available if the plant suspended operation. Given the state of change in the pulp and paper industry and the fact that Newfoundland and Labrador taxpayers are currently subsidizing the operation by approximately $10 million per year, is this a realistic assumption? Have the costs of subsidies been included in the analysis? It has been further advised “Nalcor has tended in the past to overestimate its overall load growth.” In addition, demographic shifts in the population have not been accounted for in the demand forecast. Power reliability: the conclusion of MHI is “Nalcor cannot quantify the true risks associated with a power system and are unable to provide some of the important inputs for making sound engineering and business decisions.” MHI goes on to state that detailed integration studies are required prior to the next stage of the project cost estimation to fully confirm the system requirements, operating parameters and risks associated with the selected option. This clearly implies that certain significant elements of the project were unknown and therefore, not included in the analysis provided by Nalcor. MHI further points out that the transmission lines proposed by Nalcor are below accepted and recommended reliability standards. Therefore, cost estimates are inadequate in this regard and are underestimated by hundreds of millions. In addition, MHI found that Nalcor’s cost estimates for other major components of the system are at the low end. Isolated island option costs: it has been advised that the pollution abatement equipment included in the cost of the isolated island option has a questionable basis, as the effects of pollution from the Holyrood plant have been substantially addressed by using highergrade fuel. In addition, it is noted that the proposed abatement equipment results as follows: “…actually slightly increases those emissions and reduces the plant’s energy efficiency, rather than reduce greenhouse gases.” Consequently, it is reasonably proposed by Messrs. Penney and Vardy that the present value of that $582 million be removed from the Cumulative Present Worth analysis. Churchill Falls power: Nalcor’s analysis does not rely upon Churchill Falls power in the years following 2041. In questioning the Churchill Falls power availability, MHI posed the following question to Nalcor: “What consideration has been given to the excess power capacity that will become available associated with the termination of the Upper Churchill Falls Agreement in 2041?” Surprisingly, Nalcor’s response included the following statement: “There is inherent uncertainty around guaranteeing the availability of supply from Churchill Falls in 2041 because it is difficult to determine the environmental and policy frameworks that will be in place 30+ years out.
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