Why the Emera deal will not work - and will leave us Bankrupt

Many of us have heard all of our adult lives about the cost of the Upper Churchill fiasco. We have listened to the billions of dollars lost to our economy from this extraordinarily bad deal. We also know that we have lost tremendous industrial opportunities in Labrador because this cheap, renewable and green power was sold and is being sold to Hydro-Quebec at the lowest price found in the world.

There are long term consequences of this deal - that are not highlighted as some of the more obvious ones. One such consequence is the development of the Lower Churchill and what market options we have. This has been known and understood by the "experts" for many years - but they have not advised you or me - the people.

Here's the deal - Hydro-Quebec can fill the New England States with hydro-power at prices we cannot compete with. Why? Because they purchase power from us at below a third of a cent per kilowatt hour. In other words we are not able to compete with our own power. This is a simplistic explanation but it is the fact.

Regardless of Premier Dunderdale's entertaining trip to Labrador with some New England Governors - these sojourns have no real impact. Vermont knows the reality. That State has been on the beneficial end of our Upper Churchill loss for many years.

Now the Premier, the Minister of Natural Resources, and CEO of Nalcor have concocted a power development plan that cannot work. Yes we can spend 6 billion dollars to get rid of Holyrood - so to speak - that generating station should stay operational regardless - in the event of a catastrophic failure of our hydraulic system. That was never the intent of developing the Lower Churchill - it was always mused as a possibility - but as a very small part of that development.

The Lower Churchill is probably the best studied piece of geography on the planet. The economics has always concurred that the Lower Churchill - if developed as one whole project would be the cheapest method. The current government's approach of Muskrat first makes no sense and is possibly the most expensive way to go. Further this approach requires massive subsidy from us - the people - the ratepayers. So then we must look at where the subsidy would be best placed. At a time when energy costs are high - energy intensive industry such as aluminum smelting seek industrial sites with access to renewable hydro. It's a preference. If we are willing to subsidize the power for Nova Scotia - who has no real access to reasonable power for growth - then shouldn't we be willing to subsidize the same power to attract industry to Labrador instead? Further where there is no great transmission system required if they plug in - inside the borders of Labrador - the overall price would be cheaper and the subsidy required would be less.

So here is the option - sell it cheap to Nova Scotia - so they can grow - while we pay for it - or sell it to an industry in Labrador where we gain long-term jobs and pay less.

With respect to the overall Lower Churchill development - that principle of industrial Labrador based contracts will serve us best. There may come a time - if something can be renegotiated with Hydro-Quebec on the Upper Churchill - that exporting power for significant financial return may be the way to go. Right now we cannot afford to compete with our own power. That remains a consequence of a very bad deal. If Ms. Dunderdale and her government are permitted to carry on with the proposed Emera deal - they will have completed the Upper Churchill folly and will render our future bankrupt.