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Sunday 25 November 2012

Why I Oppose Muskrat Falls

I've written about it plenty and touched on some of the reasons why I think this deal is not in the best interests of NL but it seems that the time has come to layout in straightforward language exactly why I am opposed to this megaproject.

1. The Why
The rationale behind this project has been somewhat suspect from the start. We went from no public acknowledgment that we even needed this project to plowing full steam ahead with a multi-billion dollar megaproject. The question is why? The answers have not been consistent and they don't hold much water with me.

  • Power for sale. The original reasoning seems to have been the idea that we could actually make money on the deal by selling power to the US. Over recent months we have found this to be a complete falsehood as the cost of simply producing the power at MF(not including transmission) will be far more then the current rates in the US. Even NALCOR and The NL Gov now admit that selling the power is unlikely.
  • Demand Forecast. The next rationale in line was the power demand forecast for NL that shows how we will have to start shutting off the lights by 2016 or so. My main issue with this type of forecasting uses so many assumptions in its modeling that I have very little faith in it's accuracy. Not unlike a weather forecast there is a huge margin for error. Huge.  
  • Power for The Big Land/Holyrood. The power for industrial demand in Labrador is a newer one and seems a little odd since one of those new customers just laid off the majority of it's employees as seen here. The other side of using MF to close down Holyrood does make some sense sine it is a facility that needs to be addressed. However MF isn't the best way to clean up that site, and there's a little more on this below.

2. The Process
So I obviously don't buy the reasoning behind the project but what makes the entire situation even worse is how the process has been handled from the beginning. My thoughts on this Governments efforts on keeping residents in the dark aside, there has been a significant lack of available information of this project from the very beginning. And it hasn't gotten much better. For a project that will cost upwards of $10 billion and take decades to pay off, and where the rational is not well understood there should be an open and free exchange of information on every aspect. Unfortunately this project has seen the very opposite, almost no flow of information and very little public debate or scrutiny. The only public body not directly paid by Gov or NALCOR to complete any kind of review was the Public Utilities Board and their findings were inconclusive based on the lack of information provided by Gov and NALCOR. Even in the House of Assembly there will be little more then a passing discussion on the largest undertaking NL has ever engaged in since the Churchill Falls fiasco, as noted here. The most telling sign is that even some who support the project have publicly indicated that they would like more information, not more shinny brochures in the mail.

3. The Practicality
If the rationale and the process weren't enough to turn me from the project then the sheer impracticality of the whole thing would easily do it.

  • The latest practical concern for the project is regarding the water rights for the water needed to operated the site. MF is downstream from the Churchill Falls development where the water flows are controlled by CFLCo/Hydro Quebec. There is some debate as to if they have the legal authority to limit the flow of water that would power MF as discussed here at The SRB Papers. But the main point is there even if there is a remote chance in hell that they could limit the flow of water to MF those billions of dollars will have been spent in vein. And they say they need energy security?  
  • The second note is simply the cost of the whole thing. It is continuing to rise and by the time its done we will be at or near the $10 Billion range. I've mentioned on here before how across the globe mega damn projects go over budget by an average of 30% and when we're talking billions of dollars that's a whole lot of extra money. Is it being well spent?
  • For a moment lets go back to that issue of energy security. We've all heard the old adage "don't put all your eggs in one basket" but that is exactly what we're doing here. Both from a cost perspective and from a security perspective. Don't think for one moment that there isn't a real possibility of a catastrophic failure somewhere along that proposed transmission line. Even if it is incredibly remote the possibility exists that the transmission line will go down at some point dur to damage, or weather or whatever. What then?
  • One of the largest reasons I am opposed to this project has to do with the availability of the alternatives to one huge costly project. I see the alternatives in two scales and they can be implemented in any blended format which would also provide additional security of supply due to the multiple sources. 
    1. Large scale. We are still lucky enough to have access to multiple industrial scale options including wind, smaller hydro, tidal, solar and what many consider the best option Liquified Natural Gas or LNG. This is where the real opportunity to get rid of the smoke stake at Holyrood comes from. LNG is readily available and clean burning. It is the main reason the sale of power from MF in the US will not work. LNG is changing the energy market. 
    2. Small scale. There are other areas where they have a smart grid system with incentives so that people and businesses can install small scale generation devices that can often not just fulfill their own energy needs but can also allow them to sell energy back to the grid to be used elsewhere as the need arises. This seems to be a win win situation as it engages people to help in the production and then leaves the maintenance in the hands of the owners.Then there's the revolutionary idea of mandated conservation. Why aren't new homes mandated to have high efficiency appliances, lights or heating sources? Same goes for renovations. How about financial incentives for meeting conservation benchmarks? This isn't rocket science, it's common sense. 
  • On the end of the practical problems for MF for this list is the environmental damage the current proposed project will do. In addition to the loss of woodland and the creation of methylmercury there are unknown potential impacts to the water systems all around the Goose Bay area. Salt water has already started infiltrating the freshwater areas due to reduced flow from the upper Churchill and this will exacerbate the problem.

So there you have it, not every single reason to oppose the project but certainly few of the more important ones. Now you can go do more research and make up your own mind. Good luck to us all. We're gonna need it.


  1. Ryan,great summary of the reasons why Muskrat Falls is an badly-conceived and deeply-flawed project.

    My concern is that too many residents of our province are so apathetic that they will simply resign themselves to the "inevitable" outcome of this government-sanctioned project. Despite their denials, government, in their own minds, have indeed sanctioned this project and are spending the money to prove it. Their unmitigated gall at denying this to be case should be driving an angry population to strong protests and marches in the streets. In Egypt, people are dying for freedom and here we are...letting these dictators on Confederation Hill make a laughing stock of democracy.

    We will get what we deserve in the sense that we elected this government because of apathy and now we are letting them proceed with a financial nightmare...also due to apathy.

    The need for electoral reform and power coming back to the people(no pud intended)has never been more crucial and I hope you will reengage in the political spectrum with these objectives in mind.

  2. Cyril, I won't deny the fact that for a short while I had resigned myself to the fact that this project was going ahead no matter what anyone did. However I cannot simply sit back and do nothing but complain. Even if this blog begins to get people thinking about why we are doing this project then it will have been a success.

    As to the need for political reform you know how I feel about that. The reform required is monumental. And that is evidenced by the fact that even the opposition parties are afraid to take a stand against this project. (Some have even come out in favor) This is the one area where I am at a loss as to how to proceed. I am still a supporter of the Liberal ideals but I can't help but feel that those leading the party have lost their way and they seem to have forgotten what is really important. Serving the people of NL.

  3. I share your dismay, Ryan, with respect to political reform. It's as if we have learned nothing from the scandals and corruption of the past fifty years, at both the federal and provincial level. No wonder people are apathetic.

    However, apathy is no excuse any of us to opt out of the democratic process unless we want total dictatorship, and we are not far off that now, largely due to low voter turnout.

    Like you, I retain my Liberal ideals but am disgusted with the Liberal Party. It may be time to start a New Liberal Party that takes in disaffected Tories, some NDP, and former Liberals. However, if it is ever to be worthwhile, the mechanism cannot be hijacked by a party hierarchy nor can the people lose total control of the process.

    We cannot give up at this point, no matter how hopeless it looks with regard to Muskrat Falls, and we must do whatever we can to keep the hope alive that this monstrous project will not ultimately go ahead. I know they will sanction it in the HOA but other factors may yet derail their stupid rush to financial ruin.

  4. Some valid arguments here but I would like to add NFLD would save billions if we just link Upper Churchill to NFLD with the undersea cable and not build lower Churchill. Upper Churchill has more than enough power to feed NFLD and then some. We must use upper churchill because after 2041 Quebec will not purchase any power from us anymore.

  5. Anonymous, your argument does merit serious consideration but I would personally like a new feasibility study done to see if we could do the tunnel crossing for that. It may be too expensive but is worth a look. A lot depends on whether or not QH is willing to negotiate a fair arrangement for the Upper Churchill after 2041.

    It seems to me that, if they try to screw us, we should look at a way to get Upper Churchill power to NS via cable. In an ideal world, the feds would intervene and assist both sides in coming to a fair deal. I honestly don't have a problem with Quebec getting a share of the UC but not the lion's share.

    Ryan, you are correct in that real reform requires great courage...because it inevitably leads to your own demise. However, a political force with the moral integrity to achieve this would be an awesome achievement. How does a new movement called the Liberal Democratic Alliance sound to you? Unless the Liberal smarten up, I can't support them and I see the NDP as mere opportunists. I am not blaming them for that but it would simply be more of the same old tired system we have had for decades.