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Thursday, November 25, 2010

End of the Williams Era in Newfoundland and Labrador

The first rumblings that something was up began early Thursday morning. This was quickly followed by a brief news release from the Premier’s communications director simply stating that Danny Williams would be going before the microphones to “discuss his political future”.

By 11:30 am Newfoundland time Williams did just that, stepping before the microphones in the foyer of Confederation building where he was greeted by thunderous applause and a chorus of “Danny… Danny” that continued for some time until the Premier asked for the chance to speak.

During his address, which lasted several minutes he discussed his government’s accomplishments and, as he is known to do, quoted several well known figures including the late Orson Wells when he said, “…if you want a happy ending, you need to know when to end your story…”

Danny Williams then announced that he will be stepping down as the ninth premier of Newfoundland and Labrador on December 3, 2010. At that time Deputy Premier Kathy Dunderdale will assume the leadership role until a new leader is selected.

According to Williams the reason for his decision was one of timing. He noted that much of what he hoped to accomplish when he became Premier in 2003 was now in place and he saw this as the right time to hand over the reigns.

During his tenure the Williams government improved the Atlantic Accord revenue sharing agreement with Ottawa, improved royalty revenues and ensured a provincial ownership position on offshore oil developments and most recently announced a 6.2 billion dollar agreement to develop part of the Lower Churchill hydro project.

As federal Liberal MP Gerry Byrne said today, “He’s got his bucket list done, that’s the bottom line. He’s accomplished what he set out to do.”

In spite of less than flattering headlines and commentaries in the national news media where pundits often referred to him as “Danny Chavez” or a “dictator”, Mr. Williams’ accomplishments were substantial.

Beyond those accomplishments previously identified his government also instituted a nationally lauded poverty reduction plan that saw the province go from having one of the highest poverty levels in Canada to having the third lowest. It was also during his tenure that Newfoundland and Labrador paid down 4 billion in provincial debt (approximately 25% of its debt load), moved from being a “have-not” to a “have” province for the first time in its history and nurtured a level of pride among the population that has not been seen in decades.

As a result Premier Williams’ level of support remained strong, in fact even after two terms in office his consistent approval ratings of 80% or higher (one recent poll placed his voter approval rating at 93%) was the envy of politicians across Canada.

Accomplishments accepted, the Williams government was not without its share of problems as well, including an ongoing doctor’s dispute, and the mistaken appropriation of Abitibi’s mill property in Grand Falls-Windsor (a mistake that happened during the adoption of a bill to appropriate water and timber rights from the company, a move that overall was very popular in the province).

According to MP Gerry Byrne, “He’s a loved and hated politician among the political class, but today whatever feeling of animosity people may have is replaced with envy.”

Federal MP Scott Simms told the Globe and Mail today that there are likely a few politicians breathing a sigh of relief – including Prime Minister Stephen Harper”, who ignored Mr. Williams and suffered electoral losses in his province.

Simms was referring of course to Danny Williams much publicized “ABC” (Anyone but Conservative) campaign during the last federal election. A move that saw the Harper government completely shut out in Newfoundland and Labrador.

“Danny Williams doesn’t take the middle road,” said Mr. Simms, “He doesn’t relax. For Danny Williams it’s you’re either in for everything or you’re in for nothing. At that level of play it’s a pretty intense life,” Mr. Simms said.

“Williams has an iron fist and a golden touch. It’s going to be hard to find a similar successor in the Progressive Conservative party.”

“He’s one of a kind,” Mr. Simms said. “He just personified something that we wanted for so long. I think what [Mr. Williams] did was instill a sense of pride. ... I just thought he was the right guy for the right time.”

The question now shifts to what's next for Danny Williams.

Never one to sit idle it would be difficult to imagine he has plans to sit on a beach somewhere. No doubt someone with his resume has countlss opportunities in the private sector but unless it's a CEO position on the table, nobody believes Williams would consider it. He's always been a leader, never a follower.

What about federal politics?

Never one to mince his words, when asked today if planned to run federally his response was uncharistically "political" in nature. Williams neither discounted the idea or said he would be interested. He simply said it was not the driving reason behind today's decision but that he has had many people approach him with the offer.

Interesting since there would clearly be no room for the life long Conservative inside any federal Conservative party run by Stephen Harper. That bridge was burnt long ago.

Only time will tell what the (almost) former Premier will do next. In the mean time reaction to the Premier’s resignation has been pouring in from across Newfoundland and Labrador, as well as the rest of Canada, ever since the unexpected announcement this morning.

Wednesday, November 24, 2010

Quebe's Shameful Power Play - National Post

From the National Post
The Bloc Quebecois are the W.C. Fields of politics -- they never vote for anything, they always vote against. Paule Bruelle, a Bloc MP from Trois Rivieres, provided the latest example of her party's ability to drain any room of positive energy by calling on the federal government to turn down Newfoundland and Labrador's application for $375-million in federal infrastructure funding -- not on the grounds that it may be a bad investment but because it would provide competition for Hydro-Quebec.

Newfoundland and Labrador, through its energy subsidiary Nalcor, and Nova Scotia's energy giant, Emera, have sought $375-milion in federal funding from the government's Private-Public Partnerships Canada infrastructure fund to help build a transmission link between a new generating plant at Lower Churchill in Labrador and Nova Scotia. The logical route would be through Quebec but Hydro-Quebec has already closed down that option by complaining it needs all its existing transmission capacity and the province's regulator has agreed.

Not only does the Bloc not want Newfoundland and Labrador's new green hydro power to go through Quebec, it wants to stop it going around Quebec too.

The worrying thing is that Jean Charest's Liberal government agrees with the separatists, claiming that federal funding would create an unfair trade advantage and result in a government subsidy for each kilowatt of electricity transported to Nova Scotia.

Only a Quebec government could make such a statement without feeling a sense of shame. The province likes to tout its green-energy credentials, but its environmental record is almost entirely dependent on the notoriously one-sided 72-year deal to buy Newfoundland and Labrador's hydro power, generated by the Upper Churchill Falls, for a fraction of its market price.

It seems hard to believe but the 1969 deal, which has seen Quebec make $20-billion to Newfoundland and Labrador's $1-billion, is about to get worse for residents of the Rock.

In round numbers, Quebec currently pays $2.50 per megawatt hour and then sells on the power at the market price of between $40-60 mw/h. Bad enough you might think, but that amount is set to fall to $2 per megawatt hour from 2016 for the remaining 23 years of the deal's duration. Wars have started over less.

This is the background to the screaming match that is brewing between Mr. Charest and Newfoundland and Labrador's Danny Williams. Mr. Williams is appealing the Upper Churchill deal on the grounds that there has been such a fundamental change in market conditions because of open access to the United States that there has been a breach of good faith.

The case is likely to be mired in the Quebec court system for years.

Undeterred, Nalcor has struck a deal with Emera that will see a new $2.9-billion generating plant at Muskrat Falls, linked by a new $2.1-billion transmission line to the Rock and then connected to Nova Scotia by the $1.2-billion subsea link. Newfoundland will keep 40% of the power generated, Nova Scotia will take 20%, leaving the remainder for sale to markets in the northern United States, a market where Hydro-Quebec is already strong. Muskrat Falls will leave Newfoundland and Labrador 100% emission free.

Ed Martin, Nalcor's chief executive, was in Ottawa Tuesday, trying to drum up support from the federal government. He said the deal will remove two to three megatonnes of carbon from Canada's total emissions and create about 6,500 jobs a year during the seven-year construction period. "It's a great investment opportunity for Canada and I don't want to leave them out," he said in an interview.

Whether or not the numbers add up is for the federal Finance department to decide. Ottawa's 8% stake in the Hibernia project that Nalcor has already bid upon adds the possibility of a side deal being added into the equation.

But what is clear is that the federal government should ignore bleating from the Bloc and the Quebec government about unfair trade practices, experts though they both may be on the subject.

The decision should be made on what is in the national interest -- something over which Mr. Charest, far less the Bloc, loses any sleep. If this federation is to flourish, Ottawa needs to speak for Canada.

By John Ivison

Thursday, November 18, 2010

Deal Inked on Lower Churchill Development

After decades of waiting and wondering the people of Newfoundland and Labrador learned today that the Provincial government has inked an agreement with Nova Scotia for development of a portion of the Lower Churchill Falls hydro project.

The agreement was announced at a press conference today attended by representatives of NALCOR (Newfoundland and Labrador’s energy company), Emera (owner of Nova Scotia Power) and the Premiers of Newfoundland & Labrador and Nova Scotia, Danny Williams and Darrell Dexter.

At this point all that is publicly known is that both NALCOR and Emera will partner in the development which will see 800 megawatts of power produced from the Muskrat Falls section of the Lower Churchill. The Larger Gull Island generating station which had been a part of the original development plan for the river will not be developed at this time and no timetable for its development was given.

NALCOR will build a generating facilities at Muskrat Falls (Cost 2.9 Billion). This facility will be fully financed and owned by Newfoundland and Labrador.

Emera, a publicly traded company, and NALCOR will jointly develop the transmission route to wheel the power from Labrador, through Newfoundland and on to Nova Scotia.

The subsea link between Labrador and Newfoundland will be built as a joint venture 71 per cent owned by NALCOR (cost 2.1 Billion) and 29 per cent owned by Emera (Cost = 600 million). Emera has agreed to finance 20% of the ongoing maintenance costs for the life of the agreement.

The subsea link, also known as the Maritime route, between Newfoundland and Nova Scotia will be built and wholly owned by Emera. (Cost 1.2 Billion)

It would seem there are still details to be determined relating to the Maritime link itself as officials with Emera have said that they are still negotiating agreements with NALCOR to build the subsea transmission link between the two provinces in return for access to 20 per cent of the energy from Muskrat Falls for a period of 35 years.

At the end of the 35 year contract the undersea transmission line will revert to Newfoundland and Labrador ownership for the sum of 1 dollar.

Investments by all parties into the project total an estimated $6.2 billion.

Click here to view Fact Sheets (NALCOR and NL Govt.)

Although both Provinces have asked the federal government for a loan guarantee and funding assistance to develop the sub sea link they announced today that they will move forward even if funding itself is not provided.

The entire development is still subject to regulatory approval in both provinces as well as to the approval of the boards of directors of NALCOR and Emera. In addition a native land claims treaty in Labrador must be ratified by Ottawa before the project can proceed.

Based on past history and the political implications of any Churchill Falls power contract, one might also expect that the voters of Newfoundland and Labrador will also have their say in the future of this deal.

Construction is expected to begin in 2013 with first power transmission by 2017

Based on what is known so far there are still many outstanding questions the people of Newfoundland and Labrador will be asking in the coming days.

The answers or lack of them is likely to have serious implications, either positive or negative, for the current Provincial government in the next election, scheduled for less than a year from now. Far more importantly they will have a far reaching impact on every individual in the Province for generations into the future.

Some of those questions include:

1) What are the remaining issues to be addressed in the reported “agreements” to be reached between EMERA and NALCOR for building the Maritime Link?

2) What is the overall capacity of the Labrador to Newfoundland link and the Maritime Link to Nova Scotia? Will one or both have the capacity to wheel at least a portion of the undeveloped portion of Lower Churchill Power if Gull Island is developed?

3) How will the proponents (NL and EMERA) finance their shares of the project? Is this financing in place or is the project contingent on finding financial backing?

4) Putting aside the employment created by this development, what is the actual return on investment for Newfoundland and Labrador in the short and longer term? In other words, will this project provide the Province with increased revenues in its coffers?

I’m sure as the next few days and weeks go by and we begin to learn more about this agreement a longer list of questions will begin to form. Hopefully answers will be given when those questions are asked. As they say, the devil is often in the details and while an agreement has been announced one has to wonder exactly what those details include.

At any rate, today is a time to have a quick (and well deserved) celebration before digging into the details in earnest (as we all should) to ensure that our future is as bright as it appears today.

Each and everyone in Newfoundland and Labrador needs to take some time to look at this with their eyes fully open and unfiltered by political bias or spin from any direction.

It does nobody any good to simply attack the deal for the sake of attacking. It also does no good to approve of it simply because it’s being presented by a popular government. Remember, nothing is written in stone until the people of Newfoundland and Labrador say it is. The strong people of New Brunswick proved that point not so long ago when the Provincial government there tried to ink a deal with Hydro-Quebec.

On the surface the agreement seems reasonable, and I hope it is, but until all the questions are answered nothing should be allowed to proceed. Nobody should ever forget the Upper Churchill. NEVER. If more questions were asked back then perhaps things would be far different in the Province than they are today.

Ask informed, unbiased and non-politically motivated questions. Probe the situation fully and rationally to determine where this deal ranks among past options.

the Province can’t run away from this or any deal because it has been burned in the past but neither can it simply accept the deal on blind faith.

Once bitten, twice shy. The outcome of this, for good or for bad, rests squarely on the shoulders of the public. If Newfoundlanders and Labradorians have learned anything from the Upper Churchill it’s that once a final agreement is in place there’s no going back.

This time around can be no excuses and nobody else to blame for not ensuring a better outcome.

Saturday, November 06, 2010

Lest We Forget...

With Remembrance Day approaching once again, it's appropriate to reflect on the exploits of the so called “Fighting Newfoundlanders” and remember those from the Province who fought in conflicts half way around the world.

When many think of the Province's military history they immediately think of The Royal Newfoundland Regiment. Although Newfoundlanders and Labradoreans have fought with the forces of other nations and continue to distinguish themselves today in the Canadian Armed Forces, it is with a special kind of pride that we remember the exploits of that Regiment. Originally formed in 1914.

In WWI the Regiment earned no less than 280 separate decorations, 77 of which were awarded to original members of the “first 500” of which 170 were killed in action. In fact, one in every seven men among the original force received some sort of military honour.

Many people have heard the name of Tommy Ricketts who was given the highest honour possible, the Victoria Cross, however many may not remember some of the other brave men who fought for their homeland under the most dire conditions. The Province has produced many great heroes who are not as well known, but no less deserving of recognition.

Take for example the story of Cyril Gardner, originally from British Harbour. Lieutenant Gardner has the distinction of being the only known allied serviceman to have received the German Iron Cross. The Iron Cross, which was handed out only to the bravest German military personnel, was given to Gardner on the battlefield.

As the story goes, Gardner’s unit was engaged in battle with a German patrol of 70 men. During the night, as hostilities wound down Gardner, who spoke German, took it upon himself to grab his gun and head out to the enemy encampment.Sneaking into the enemy camp, the Lieutenant turned his gun on the officers, capturing them unharmed. With their “head” cut off so to speak, the remainder of the troop immediately surrendered. Lieutenant Cyril Gardner had single handedly captured an entire German Patrol.

Upon marching his prisoners back to his own encampment he was met by a British Officer who intended to shoot the unarmed prisoners. As the German soldiers looked on in horror Lieutenant Gardner once again demonstrated his sense of bravery by stepping into the line of fire to protect his prisoners and telling his superior officer that if one German were shot the officer would be the next one to die.

After a moment of hesitation the officer walked away and it was then that the commander of the German patrol, who had many medals on his uniform, stepped up to Gardner and removing the iron cross from his chest, pinned it on Gardner’s, to the applause and cheers of the German soldiers.

For Centuries, even before the formation of the Royal Newfoundland Regiment, the people of Newfoundland and Labrador have answered the call whenever it arrived. Newfoundlanders and Labradoreans have been involved in major conflicts around the world since the mid 1600's, including: The Anglo-Dutch Wars – 1652 The War of the Austrian Succession – 1743 The Seven Year War - 1756 The American Revolution - 1775 The Napoleonic Wars – 1796 The War of 1812 World War I – 1914 World War II – 1939. Add to this the number of young men and women who have proven themselves in places like Korea, Afghanistan, Bosnia and countless other areas of conflict or peacekeeping around the world, and we can clearly see that the Province has a lot to be proud of.

This Remembrance Day and throughout the Year we should all take some time to visit a Legion Hall or local war memorial, to stop and chat with an aging veteran and to offer a little show of thanks for the sacrifice these fine men and women have made to protecting our nation.

Statistics show that every day in this country an average of 80 veterans die. That’s more than at the height of conflict in World War II. It only takes a moment to shake a veteran’s hand or buy one a cold beer at the local Legion Hall. It might seem like a small gesture, and it is, but even taking a moment to express a little gratitude will brighten the day of some of our bravest and most deserving citizens.

In the mean time, why not follow this link to view a wonderful musical tribute to our veterans. The song, Pittance of Time is performed by Atlantic Canadian musician Terry Kelly. It's worth the pittanc of time it takes to watch. VIEW VIDEO

Tuesday, November 02, 2010

A Christmas Miracle Comes Early

It may not be Christmas quite yet but it seems a seasonal miracle has happened none the less thanks to a recent article in the National Post.

Who would have thought a national paper would actually side with Newfoundland and Labrador on any issue, let alone in its struggles with Quebec.

Enjoy the Post article, but don't expect to read too many like this one in the national papers. Remember, as far as most Canadians are concerned the Country's border ends at Halifax.

John Ivison: Quebec should be embarrassed by powerline protectionism

My office phone rang the other day and the conversation went something like this: “Hello, it’s Danny Williams here,” said a familiar voice.

“Er…hello, Premier.”

“I’m not very happy about today’s column, where you compared me to Robert Mugabe….”

“Er…no, Premier.”

I’d written about allegations of intimidation during the last election in the Newfoundland riding of Avalon, where it was suggested Mr. Williams’ Anyone But Conservative campaign had led to tactics more familiar to political campaigns in Zimbabwe than Canada .

According to Mr. Williams, the allegations are untrue “on my father’s grave”. I tried to substantiate the rumours during the campaign, with no success. So until someone comes forward with some proof, we must take the Premier at his word.

In any event, it proved an interesting, if tangential, aside to the real issue I’d been writing about – namely, Newfoundland and Labrador’s attempted purchase of the federal government’s stake in the Hibernia oil field and Ottawa’s potential investment in a sub-sea electricity transmission line from a putative Lower Churchill hydro-electric project to markets in the south and west.

The province’s electricity corporation, Nalcor, has applied for $375-million in federal funding to help pay for the multi-billion underwater transmission line.

The main lesson that readers should take away from this story is what a sorry admission of failure in Canadian federalism it represents. The obvious route to markets in Ontario and the U.S. for Lower Churchill’s power is overland through Quebec .

Hydro-Québec claims that upgrades of up to $3-billion would be required to transport power through the province. Quebec’s energy board, the Régie de l’énergie, has sided with its own power corporation against Nalcor, even though it was prepared to pay for “reasonable upgrades” and up to $200-million in annual tariffs. Needless to say, Mr. Williams unleashed a broadside when the decision was announced in May, protesting Quebec ’s “arrogance and discriminatory business practises”.

You won’t read this in this column very often, but Danny Williams has a point. The Régie decision is an insult to add to the considerable injury of the existing, long-term Churchill Falls contract, under which Newfoundland and Labrador is forced to sell power for a quarter of a cent per kilowatt hour and then watch Hydro-Québec resell it for up to 36 times that price.

Both situations are a disgrace but only one is within the federal government’s purview to change.

The National Energy Board, an independent regulatory body created by Ottawa , has jurisdiction over designated inter-provincial power lines by determination of the federal cabinet. No such lines have been designated, leaving the field to provincial regulators. But a government that genuinely believed in making the federation work more effectively, not to mention saving Canadian taxpayers billions of dollars, would demand that Quebec open up its transmission lines.

Contrast this mess to the situation in Europe where the much-maligned European Union has stepped in to remove barriers to cross-border exchanges in electricity. New regulations mean transmission system operators are obliged to take new generation and compensation is paid by the operators of the national transmission systems from which cross-border flows originate.

If 27 sovereign states can reach agreement on a system that forgoes protectionism and monopolistic market dominance, in exchange for more competition and lower consumer prices, why can’t Canada ? Quebecers should be embarrassed.

John Ivason - National Post