Shocking admission from Nalcor Energy CEO serves as chilling warning to BC Government that exempted Site C project from independent review of BCUC.

Posted on by Laila

Breaking news this morning from Newfoundland: the Muskrat Falls dam project is officially a boondoggle, having doubled in price and leaving their hydro CEO to make a shocking admission:

“Muskrat Falls was not the right choice for our province.”

musratfallswrongHear the words straight from his mouth, here:

I’ve written about Muskrat Falls several times, including this warning back in February in which I detailed the similarities in how both the Newfoundland/Labrador government and the BC government both failed to do an independent review of the project prior to commencing. https://lailayuile.com/2016/02/08/muskrat-falls-fiasco-provides-example-for-british-columbians-of-potential-future-of-site-c-why-premier-clark-must-send-project-to-bc-utilities-commission-independent-review/

In fact, the similarities of how the Newfoundland government tried to justify a project that wasn’t right – and have now admitted it- to how the BC government and BC Hydro have tried to justify Site C, are alarming.

Newfoundland officials were forced to call for an independent review into Muskrat Falls months ago, after costs spiraled and delays plagued the project, one that like Site C, had been pushed ahead despite overwhelming opposition and protests of taxpayers and First Nations.

Today, Muskrat Falls is trending on twitter and there is no joy for the many people who, like the thousands of British Columbians, have opposed the project and begged the province to stop.

https://twitter.com/TelegramJames/status/746336305307615232

From the Advertiser:

“And costs were underestimated. Overruns have come.

“It was built on false assumptions, faulty assumptions, and it went from there,” Marshall said.

 

 

https://twitter.com/_ericacadwell/status/746342042901561344

 

From NTV :

When first announced in 2010, Muskrat Falls was presented as a $5-billion project. The estimated cost now stands at $9.1 billion. That rises again to $11.4 billion when interest is included.

Marshall called the project a “boondoggle” and said it never should have been sanctioned. But he added it’s too late to turn back. Marshall said he did not have an exact cost estimate for stopping the project, but insisted it was not feasible to cancel all the contracts.

Nalcor expects the cost to consumers will be 21 cents a kilowatt/hour in 2021, which could be the highest rate in Canada. But Marshall pledged he would do everything he can in the next four years to mitigate that impact.

 

This is, without a doubt, the future of Site C, because like Newfoundland, there has been no independent review of the financial plans, the estimates, the cost etc. We have the process  here to do that- I’ve written about this extensively and the WAC Bennett Dam repairs just underwent such a review to protect taxpayers.

And sadly, Premier Clark,Minister Bill Bennett and even Board of Trade president Ian Black of have all been given large platforms to tell the public how great Site C is and how much due diligence has been done through the Joint Review Panel.

It’s a lie, because the Joint Review Panel was not and could not review the financial aspect of the plans and recommended it be sent to the BC Utilities Commission because they could not see a need for this energy! Rarely has any reporter challenged their statements. The only time I’ve seen it done- and not widely seen across the province- was with Jonny Wakefield who asked Clark about Muskrat falls in this Q &A: http://www.alaskahighwaynews.ca/regional-news/q-a-premier-christy-clark-1.2242019

AHN: How closely you’re watching the Muskrat Falls project in Labrador? It seems every couple weeks you hear something that’s gotten more complicated, or there’s another cost overrun there. How does B.C. keep from falling into a similar situation?

CC: The same reason we have a balanced budget and they don’t, and the same reason we have the fastest economic growth in the country and they don’t. We really watch our Ps and Qs, (and are) very careful about those financials. Important though to remember too—BC Hydro spent 10 years planning this project. This isn’t a back of the envelope project. That’s meant they have worked through almost every scenario and tried to risk-manage that. So it’s really minimized any of the risk that they have. That kind of extra work and the time that they took to do it is really paying off now. I don’t know very much of the background to Muskrat Falls, but I do know that in British Columbia we have proven ourselves and the country to be the leaders in managing the province’s finances well and that includes BC Hydro.

Guess what? That’s what the premier of Newfoundland and the former CEO of Nalcor said too…. and yet… they are now scrambling as the truth comes out.

I would hope that this kind of critical concern and examination appears on the front page of papers across BC. I would sure like to see Clark and Bennett get asked directly about the exemption of the only independent financial review that could save taxpayers from a disaster like Muskrat Falls-that these concerns are not being examined is alarming-this is the time for a full stop. And those in the Liberal caucus who bill themselves as fiscal conservatives would do well to break rank on this one because silence now will have big implications later- hard to pass yourself off as fiscally conservative when you’re on board with building a project that isn’t needed. Bennett’s decision to retire now is a good one- he knows full well whats coming down the pipe on this project,he’s said it himself.

bennettSiteC
Thankfully, unlike Muskrat Falls, which has the dam structure and power plant well underway, Site C is not too late to be cancelled, or halted to allow a financial review by the BCUC now, to prevent making headlines for an even bigger boondoggle later on. It’s never too late to admit a mistake.
Time to put the ego’s aside in government, and put the financial security of the province first. I urge all of you to contact your MLA’s with this story. Write letters to the editor. Ask hard questions. Because you will be bearing the burden if this continues. As Harry Swain, chair of the Joint Review Panel stated again recently:” I think we are making a big mistake, a very expensive one…”

44 thoughts on “Shocking admission from Nalcor Energy CEO serves as chilling warning to BC Government that exempted Site C project from independent review of BCUC.”

  1. Keeping Laila’s excellent previous and current writing on this in mind, I now await analysis by Mr. Keith Baldrey, Global BC’s Legislative Bureau Chief. I expect the comparison will be interesting and informative. Over to you, Mr. Baldrey; show us what you’ve got.

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      1. I believe Horgan said they might revisit the decision if elected… nothing more firm than that,despite the growing evidence and continual environmental infractions up there. Any other company would have been shut down by now. Hydro gets to carry on as usual.

        Lana Popham has been posting and tweeting since the Boons received their notice from Hydro to leave the premises by Christmas or be expropriated. Which is why this makes this all the more important to halt now.

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        1. Yes, absolutely critical. Now!
          Horgan “might” revisit, “if” elected.
          Both extreme long shots.
          I’m beginning to think the only way, is Rafe’s way.

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      2. hogwash
        Hogwash is complete nonsense, lies, or ridiculous actions. Any diet plan that promises you’ll lose twenty pounds in two weeks is hogwash.
        The informal hogwash is perfect for talking about falsehoods and foolishness. Your little brother may insist that his lemonade stand will make him a millionaire this summer, but you know that’s hogwash. And many politicians give long speeches that seem, in retrospect, to be nothing but hogwash. The word has seen a dramatic evolution, from the fifteenth century “slops fed to pigs,” to “cheap liquor” in the 1700s, to “inferior writing” towards the end of the eighteenth century.

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    2. Here’s one citizen’s observations from NL, (and to the lawyers – this is opinion for your purposes).

      There is no (real) political opposition in NL except the citizens who are against the corruption and the project. The “reds” & the “blues” are all proponents of the project (on the same team). The orange party is pathetic and almost non-existent politically. All the MHA’s are gagged sheep who go along to collect the 3 P’s (payroll, perks and pensions) but for one independent (Paul Lane) who was turfed from the Liberals for speaking against the project.

      Muskrat is a scam of Canadian-historic proportions. … SNC Lavilin is globally renown for corruption and it runs downhill from there. Former Premier Danny Williams, likely several Premiers since, and the current Premier Dwight Ball each have business holdings and have used their Premier positions to advance those business interests through absurdly weak blind trust rules (loopholes). Williams, (or “King Con” as he is now known publicly), “purportedly” (Hi lawyers)… pilfered huge blocks of Crown land WHILE he was Premier… he bought many acres at just over $300 per acre, through a blind trust run by his relative. This was/is PRIME St. John’s real estate at an insanely low price. He’s now attempting to market them through his (now infamous) Galway project. Many call it “Gaul-Way”, (as in “the unmitigated gaul”).

      Many MHA’s, most notably our current Finance Minister Cathy Bennett, are (also) said to hold shares in the mining companies in Labrador that have contracts for hugely subsidized power rates. Bennett was on the Board of Nalcor before becoming the Minister and is an owner in a side company that has received millions in contracts from the project. This was all set up before she installed the fraudulent austerity oppression that the citizens are currently enduring painfully.

      There is work underway to develop a new party to provide a real alternative. Even our Auditor General appears to be “on the take” due to his unwillingness to investigate anything of substance pertaining to Nalcor. Nalcor’s current boss Stan Marshall seems to be the only one telling the truth about anything. Stan doesn’t need the money, as he owns huge blocks of shares in Fortis (Fortis owns NL Power who is set to bill the public for the entire project), Stan seems stable minded, and/or financially independent, enough not to be bought or coersed by “the Danny factor”. (some folks refer to NL’s corrupt oligarchy that way).

      We need a judicial or public inquiry to force open the books but so many people have soooo much to hide that nobody wants to throw the first stone at the neighbours’ “glass house”… because you’ll then hear the shattering across the continent and our jails are overfull now. Our main prison is hundreds of years old and totally disgusting but there’s no monety left to fix potholes let alone update facilities.

      Muskrat Falls is a Canadian fraud and tradgedy like no other … with the possible exception of Site C and other similar projects.

      It seems that organised crime has taken over much of Canada’s wealth and is billing the public on a future genrations’ payments basis for what cannot be stolen in cash. We need to become more united nationally to fight this as a country in my opinion.

      Happy 150th … Cheers!

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    1. I would think in this case the need to inform the people of BC would come ahead of sharing a link, but I have changed the source to accommodate your restrictions…….

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  4. Sterling work, Laila. It’s astounding that the BC Liberals would blow any remote chance they might have taken to redeem themselves to some small degree from the “sins of the father” by exceeding the festering wound of BC Rail (it’s corrupt sale and corruption of the corruption trial) with over-the-moon perfidy perpetrated in the people’s public power-producer.

    Your good work—the kind of work pseudo journalists are regularly shirking—is vital in substantiating the BC Liberals’ conscious intention to bilk the public weal, an essential ingredient in prosecuting the charge of breach of public trust.

    Naturally the BC Liberals’ ouster is a primary goal but, given the difficulties the NDP will have in arguing to shitcan Site-C regardless of its degree of completion for the good of the province, the sooner an injunction to stop further construction can be obtained, the better for everyone.

    I still don’t understand why such an injunction can’t be sought right now, one on the ground that the independent assessment has deliberately been avoided to rationalize a dam we don’t need. It seems so absurdly plain to me: there’s no LNG industry—the supposed reason to build Site-C— but Christy makes no secret of her plainly self-serving belief that it does. I don’t see a defence here—meaning its a good time to attack her position in court.

    Why isn’t this happening?

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    1. I’ve wondered the same thing. ( And thanks for the kind words, I think this is incredibly important news and very very relevant to what is going on here in BC)

      I’ve pondered this before in a post about an injunction,because the exemption from legislated oversight of the BCUC, created to perform financial due diligence on these projects, is a breach of public trust in my laypersons opinion. And could be perhaps argued as such. I’ve tossed this out there to some of my followers on twitter which includes many lawyers,will be interesting to see what comes back.

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        3. Horgan should be all over this.
          Why should you and others be doing the heavy lifting for him?
          What are we paying him again?
          Couple hundred grand or so?
          And you get how much?

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        4. I write the blog for free as most bloggers do, with the grateful assistance of occasional contributions to help offset associated costs.

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  5. I know you work for free Laila, but you earn RESPECT, something that’s alien to those others. Mind you, that and a couple of bucks will only get you a cup of coffee. Perhaps we can make it up to you one of these days.

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      1. Sharing these posts are great..same with the other bloggers as well who do great work- Norm, RossK etc . print them off, put them where-ever you go… I’m thinking billboards at some point. 😉

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    2. I never did this to get rich, that is what the occasional lotto 649 might do one day…lol.If it was for money I’d have stopped years ago! 😉

      I do like fishing…. 🙂 I’ll make it up there one day my friend.sooner than later.

      Liked by 1 person

  6. Great work !! Laila ,you deserve to be recognized for the investigative reporting that you do,i am sure this is coming your way these soul lacking corrupt people in govt and the media are doing justice to you they are worried the fact that you Ross K,Rafe,,Grant are getting more followers and there own polling tells them so Good Luck to all of you.

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  7. Here’s what I have penned to my MLA this morning. Others are free to use it, in writing their MLAs:

    2016-06-25

    Mr. Martin,

    As a fellow citizen of BC — I don’t know how you can sit back and allow your party to carry on with the Site C project. It isn’t just a little mistake that will be soon forgotten. It is a colossal boondoggle, that will ruin farmland and cost Hydro ratepayers for many decades… all so your party can get re-elected, it seems.

    If you missed Harry Swain’s lucid condemnation of the dam, here’s his post:

    http://vancouversun.com/opinion/opinion-site-c-truly-awful-economics

    Here’s a piece by Dermod Travis, showing what a poor foundation on which Hydro has built its Site C case.

    http://www.huffingtonpost.ca/dermodtravis/bc-hydro-site-c-network_b_10658098.html

    And here’s a post by Laila Yuile, comparing Site C to another dam disaster, Muskrat Falls:

    https://lailayuile.com/2016/06/24/shocking-admission-from-nalcor-energy-ceo-serves-as-chilling-warning-to-bc-government-that-exempted-site-c-project-from-independent-review-of-bcuc/

    A point Laila makes is that we have not gotten Site C “to the point of no return” as our premier so tactlessly announced at Bill Bennett’s funeral. There is still time to pull back, allow the BCUC to take a proper look at the business case, then proceed if it is approved (which you know has little chance).

    This would be a great time to flip-flop on a decision, because doing so would be the right thing for the majority of British Columbians. I implore you and your party to do the right thing.

    G. Barry Stewart
    Chilliwack, BC

    Liked by 1 person

    1. So well done my friend, so well done. And this IS something each of you can do. You can write an old fashioned letter, drop it off or mail it. You can stop by your MLA’s office and make an appointment to speak with them. You can ask for a phone call. These are elected officials.

      I guess this really gets to the heart of it. And a fine example is what happened in South Newton here in Surrey with the schools and city over building. Cindy Daiglish actually had lawn signs printed up in bright red, sold them to residents, that said ” Where will your kids go to school?” as a way to pressure government. And it worked – several announcements were made out of the blue because those bright red lawn signs sure didnt make things look good for Marvin Hunt.

      It is not true that too much has been invested to let things go. Muskrat Falls is a financial disaster and they now have been forced to admit it was a bad idea and should never have been built. The politicians are all pointing fingers at each other now but the truth is not one person involved in getting that project had the cajones to stand up and say ” WHoa, we need to stop and do some due diligence here”

      Site C is BC’s Muskrat Falls. Clark has been asked several times to send this to the BCUC, by residents, by the opposition, by the Joint Review Panel, and she has said no every single time. Never, ever forget that. And if the rest of her caucus refuses to find the moral fortitude to stand up and speak out,they will bear the burden of the same outrage being demonstrated in Newfoundland now.People are already having a hard time paying hydro bills, and BC Hydro debt is skyrocketing. This is, a financial disaster in the making.

      People are losing homes that have been in their families for generations.An entire valley is being clear cut and desecrated.

      Don’t you think we should have the assurance from the BC Utilities Commission, that this project is even needed? They already denied it twice.

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    2. Well done G. Barry Stewart.

      As your message sums it up perfectly and with your permission, I’d like to send it along to support my independent MLA Vicki Huntington with a note that says I saw the letter and it fully mirrors my thoughts. She has been calling for BCUC examination of Site C for some time.

      The message should be sent not just to BC Liberals, but to NDP MLAs as well, since as Laila points out, the NDP must give us its position prior to the election on cancelling the project or at least halting it for BCUC review.

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      1. You are welcome to use it, Lew.

        On review, I see I could have left a few words out, for better grammar. You’re welcome to take away or add to it, as are others.

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    1. We are aware of that.Another manner in which the Libs have deliberately hogtied the BCUC- I followed and reported the proceedings on the WAC Bennett dam repairs that were long overdue and very critically needed and saw the kind of examination and questioning that was done. I know full well the BCUC would be very unlikely to approve this project that BC Hydro says is needed. Of course they ‘ need’ it. Kind of like car manufacturers say we need new models of cars, or like Rennie says more condos are the solution to housing affordability….

      We know the NDP have called for a review…but will the NDP halt the project if they win? Or simply ‘possibly revisit it” which imo, are waffle words.

      Would love to have an answer.

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    2. In the article cited by Islandcynic, John Horgan is quoted as saying he would revisit the question of cancelling the Site C project leading up to the provincial election 18 months ahead. He also said, “I can’t speculate on what the outcomes of the court cases will be nor can I speculate on how far advanced any projects will be. What I wanted to do today was to demonstrate that there are alternatives, genuine alternatives, and they are supported by science and good economics.”

      Those are waffle words writ large and how anybody could miss it is surprising. Also, lack of BCUC resources is a red herring. The government can fix that with the stroke of a pen.

      Given that Christy has now announced the award of major contracts, and according to a statement by Bill Bennett a month ago (May 19) half of the projected costs (north of $4 billion) will have been allocated by the time of the next election, the costs that John Horgan wouldn’t speculate on are much firmer than when he made his comments. He owes us an updated commitment about what he’ll do. Is an NDP sponsored application for an injunction based on breach of fiduciary duty or trust out of the question? If so, he can tell us why, along with what his alternate plans are.

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      1. This out today from Dix. Great article… and he steps around the issue of what the NDP would do with ease. No free pass here. If it is such a disaster- and it is, as we have seen what happened in Newfoundland when their government pulled a Clark and pushed it through…. then take a damn hard stance. https://lailayuile.com/2016/06/24/shocking-admission-from-nalcor-energy-ceo-serves-as-chilling-warning-to-bc-government-that-exempted-site-c-project-from-independent-review-of-bcuc/

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    1. Great little analysis here of the Newfoundland project. So much like how Clark has proceeded with Site C, it’s more alarming than ever.

      Yet silence still in local media. No analysis. No questions.

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  10. Hey Laila,

     

    Time to do an update on BC Hydro and how Bill 30 is privatizing it!

    Prof Calvert of SFU says we are quickly losing our Crown asset worth hundreds of billions

     

    Arne

    Sent: Friday, June 24, 2016 at 8:25 AM

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  11. The CEO of Muskrat Falls may have seen the light, but none are so blind as those who will not see. Christy and her cabal are those who will not see. Christy wants that dam to go ahead and it will as long as she is in office. It doesn’t matter how determental it is to the environment society, the famers, the treasury. Christy wants it and she is going to have it. Failure is not in her dictionary. It will always be some one else’s fault. she needs this dam so she has a mega project. With out Site C there is no mega project and she can’t go to the polls without on to spin. its one of the last few big projects she can use to drain the provincial treasury and pass the money on to her corporate sponsors. So the nice man who gave the advise regarding Muskrat Falls can save his breath. Christy will find a nice to phrase to peddle and then Keith and the rest of the Msm WILL GEt behind it. And this dam isn’t about electricity, its about water and selling it out of the country.

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  12. With the greatest respect to all who have posted thoughtful, constructive comments and to Laila’s tenacity…

    The general public, preoccupied with careers, kids & a large mortgage have no time for the nuances of site C et al. I bet the majority of British Columbians will be blissfully unaware of the pertinent issues until they get the bill.

    Dissatisfaction and unrest is being revealed by, Harper’s demise, the Brexit vote and unfortunately, the rise of Trumpism etc.

    Neo Liberals are starting to receive their comeuppance, however slow this realisation may seem. Much remains to unfold and it won’t be pretty.

    George Monbiot lucidly explains the forces at play in this address (it’s long, but stick with it) https://www.youtube.com/watch?v=X2Tc8Yv92Mk It’s not about site C but about the forces that anonimously create it’s illegitemate raison d’etre.

    I am very admiring of Laila and her thoughtful readers for continual vigilance and valuable pressure. The current economic and political forces at play in BC disgust me; they certainly represent a waning ideology IMHO…things will change in time. It behooves HM loyal opposition to formulate a plan for significant change for the benefit of all British Columbians.

    Maybe therein, lies the problem. Even Monbiot can’t figure it out.

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  18. […] ***( Note by Laila: Research of mega dam projects around the world has shown that most large dam projects are not worth the costs,run over in construction time and costs and impact budgets for years beyond that. http://www.nytimes.com/2014/08/24/opinion/sunday/large-dams-just-arent-worth-the-cost.html?_r=0 ) We are seeing this again in Newfoundland where Hydro execs there recently admitted they were wrong about the overdue and way over budget Muskrat Falls project, now saying it was wrong to build it. https://lailayuile.com/2016/06/24/shocking-admission-from-nalcor-energy-ceo-serves-as-chilling-warni…*** […]

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  19. […] Nalcor ( their hydro company) actually admitted right at the end of June – while most people were busy with the end of school and plans for the short Canadian summer-that Muskrat Falls was the wrong project for Newfoundland/Labrador. Their CEO also admitted their estimates were wrong, along with pretty much everything else. You can read that and listen to it at this blog post here: https://lailayuile.com/2016/06/24/shocking-admission-from-nalcor-energy-ceo-serves-as-chilling-warni… […]

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  20. […] And  what did he do after being elected? The quick version is that the province claimed too much money had been sunk into it to back out, referred to contracts etc ( sound familiar?) and carried on. Sadly, it finally got to point where the amount of money spent in that black hole coupled with ongoing problems and opposition resulted in the CEO of their hydro company Nalcor publicly admitting that their estimates and forecasts had been wrong and that building the Muskrat Falls dam was a mistake. I wrote about that last June: https://lailayuile.com/2016/06/24/shocking-admission-from-nalcor-energy-ceo-serves-as-chilling-warni… […]

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