DenyAsk

Monday�s Blog Post forecasting a �status quo� Budget didn�t exactly require going out on a limb. The Government had long ago made clear that they don�t like making decisions, especially ones that disappoint or that engender public protest; so they don�t. Problem is, inaction and indecision carry consequences. Continued vacillation threatens the fiscal viability of the whole province.  Moody's, a financial services and debt rating agency, has our position in its crosshairs. In a review released just yesterday, the Firm noted that NL's "path to balanced budgets is at risk". They said: It�s not a novel announcement. But the right ones are saying it  (text of announcement is provided at the end of this Post.) The Government ought to be aware that, in failing to address the deficit, it is risking a further credit rating downgrade. Every notch that the rating is reduced means higher interest costs and a decline in the number of financial institutions that will lend to the p...

Guest Post by David Vardy Will the Coalition make a difference?  One of those invited to join the Muskrat Falls Concerned Citizens� Coalition (MFCCC) asked the following questions: Thank you for the invitation to join your Coalition. I have two questions, answers to which will have an impact on my decision as to whether or not to join: Questions: 1:    How can the Coalition positively impact the disastrous situation that Messrs Williams, Martin, Bennett and others have visited on the residents and taxpayers of this Province?  2:   What can the Coalition do to prevent similar misadventures by future majority governments? David Vardy responded as follows: I am taking the liberty to offer my own feeble attempt to answer your questions. At the same time I am inviting my MFCCC colleagues to challenge me or to build upon what I have said. I am only one person and these are my views only: I believe the Commission has demonstrated its willingness to listen to the public...

If prudence was ever a word in Tom Osborne�s lexicon it was likely extracted as a condition of accepting the Finance post. Profligacy, now known in this province as status quo, is a more likely fit when the Minister delivers, on Tuesday, the seventh deficit Budget in a row. Ask public sector labour. Ask the health care sector. They know there can be no change because their fiscal arrangements � which represent a very high percentage of total budgeted expenditures � have been carved in stone. Then there are the Polls. When the Premier�s popularity climbs amidst a refusal to acknowledge a fiscal crisis � one that grows each day � it might be right to suggest that the public, too, is content to leave the pain for someone � anyone � else.   It is possible that other factors are at play; that what is really influencing Ball�s polling gains is a Tory leadership vacuum. But I�m not so sure about that.   More likely, the public is refusing the leadership the Premier expects of them, f...

(Your response to this invitation is time sensitive due to limited time for receipt of application. Please include your address - and phone# if desired) EMAIL: MFConcernedCitizensCoalition@gmail.com Why bother establishing Coalition ? Will our children and grandchildren want to remain here in Newfoundland and Labrador? Would we want them to live here and bring up their families? Will this be a good place for them to live after we begin repaying the huge debt from Muskrat Falls? What can we do about it, other than to leave? One thing we can do is to make the Muskrat Falls Inquiry a success. The Commissioner has invited applications for standing for the Inquiry. The Inquiry will provide a forum for evaluating why the project was sanctioned and why it has become such a monumental fiasco and a threat to our sovereignty and financial sustainability. We are hopeful it will shed light on the options for the future, to mitigate the damage. There is a real danger that Nalcor will overwhelm the ...

Guest Post by Phil Helwig, P. Eng. A year ago I started an article in reaction to Danny William�s speech to the Board of Trade but never completed it. Now that Nalcor�s management of Muskrat Falls will be scrutinized. It is timely to examine some issues for the investigation. 1.       The mandate of NL Hydro / Nalcor is to provide power to the citizens of the Province at the lowest possible cost. Early in my career I worked in the Systems Planning Group of Shawinigan Engineering under the direction of George Scruton who was an engineer of impeccable integrity. Most of our work involved system expansion studies. George insisted as a fundamental principle that the cost of all the options � capital, fuel, operation and maintenance and related financial costs be developed to similar standards of accuracy and that competing options be equivalent in terms of reliability. In the case of Muskrat Falls I believe that the probability of bias was high given the big dispar...

Guest Post by David Vardy This is Part I of a series on the financing of Muskrat Falls and will focus on the 1150 km transmission line from Muskrat Falls, across the Strait of Belle Isle, and down the Island to Soldiers Pond, outside of St. John�s. Part II will deal with the financing of the generation component. We will refer to the line as the Labrador Island Link (LIL), which is the only high voltage direct current (HVDC) line in the province. It is owned jointly by Emera and by Nalcor. The LIL�s direct costs, not including financing costs during construction, amount to $3.7 B of the $10.1 B direct costs of the LIL and the generation assets combined, representing 37% of the capital assets which comprise the NL components of Muskrat Falls. Cost of financing during construction brings the total LIL cost to $4,959 or 39% of the overall $12.7 billion estimated cost.  The Economics of Public Utilities In a hydroelectric project like Muskrat Falls both transmission and generation are ...

Guest Post by PlanetNL PlanetNL8: Labrador Interconnected System (LIS) Under Threat of Huge Rate Increases The largest regulated zone in Labrador is the Labrador Interconnected System (LIS) powered by Churchill Falls with transmission lines running to Labrador West and East.   These are all relatively old assets that have provided exceptionally economical service and the lowest rates in North America and possibly the entire western world.   Government policy for this unique regulated rate zone, however, is about to prove the old adage of having too much of a good thing could prove to be not good for you.   Low rates have attracted new demand that will lead to expensive new transmission line construction resulting in major rate increases for everyone in the LIS.   There�s also a long shadow cast by Muskrat Falls as well. Government has the authority to select a different course but as demonstrated by Muskrat Falls, doing the right thing for ratepayers is probably not ...