Astaldi meltdown symbolic of rush to sanction Muskrat Falls, says consumer advocate

The man whose job it is to protect the interests of electricity ratepayers in Newfoundland and Labrador says the Astaldi eviction from Muskrat Falls is symbolic of the rush to sanction the controversial project.

• Astaldi told to stop work, but employees remain on the job at Muskrat Falls for now

Dennis Browne, the province's consumer advocate, saidhe was alarmed by news Thursday that Astaldi, the company hired to construct the hydro generating station and related infrastructure at Muskrat Falls, wastold byNalcorEnergy to stop work.

The extreme measure was taken following yet another outbreak oflegal and financial clashes between Nalcor and Astaldi,and constant headlines aboutAstaldi'sfinancial woes.

• Astaldi in talks with Nalcor over 'extra cost' incurred at Muskrat Falls

Browne was not entirely surprised by this latest setback, saying it was clear from the start thatNalcorEnergyand the provincial government, led by then-premier KathyDunderdale, "unnecessarily and prematurely" sanctioned the project onDec. 17, 2012.

Brownehas been spending his days attending public hearings for the ongoing judicial inquiry into Muskrat Falls, and the well-documented cost and schedule overruns that have caused so much controversy and concern in Newfoundland and Labrador.

• Cashin teams up with lawyers to fight Muskrat Falls

He's long been askepticof the project, and was part of a group of lawyers who formed the 2041 Energy group six years ago in order to oppose Muskrat Falls.

No urgency to sanction project: Browne

Browne saidevidence shows that project leaders were warned that construction schedules were extremely ambitious.

Inquiry testimony has also revealed how Astaldistruggled to mobilize its operations in Labrador, and that Nalcorhad to step in after SNC-Lavalin, the company awarded the critical construction management contract, failed to fill key positions on its team.

Browne saidthese problems could have been avoided if Nalcor, which owns the project on behalf of the province, had spent at least another year examining the ramifications of proceeding with Muskrat Falls.

There was this massive and unnecessary rushand it's never been really explained because we didn'tneed the electricity in an urgent and emergency basis.- Dennis Browne

"We had every ability to do so," saidBrowne.

"Instead there was this massive and unnecessary rushand it's never been really explained, because we didn'tneed the electricity in an urgent and emergency basis under any circumstance.And it's doubtful from what we know today if we needed the electricity in that quantity in any case."

The Lower Churchill Project, as the entire project isknown, includes the 824-megawatt hydroelectric facility near Happy Valley-Goose Bay, the 1,100-kilometretransmission line from Labrador to Newfoundland's Avalon Peninsula, and anew transmission line from Muskrat Falls to the existing Upper Churchill generating station.

The project was sanctioned at a construction cost of $6.2 billion, with first power scheduled for mid-2017.

Construction costs have since soared to $10.1 billion, with all-in costs, including financing charges, driving the price to nearly $13 billion. And first power from Muskrat is not expected until mid-2019.

Public's interestignored

Nalcor'spartner in the project, EmeraInc., constructed the newMaritime Link across the Cabot Strait that will transmit Muskrat power to Nova Scotia. It came in on budget at a cost of roughly $1.6 billion.

Browne said it's clear to him "there was no one really looking out for the public interest."

He said confusion reigned during early planning and construction, and addedit's "very concerning" that Nalcor'sproject team was dominated by those whose expertise was grounded in the oil and gas industry.

"Makes you wonder if oil and gas people were doing a project, would they use all hydroelectric people? Doubtful. It was a situation that was totally inappropriate," says Browne, adding that all the warning signs of trouble ahead were missed because Nalcor's leadership "seemed to know better than anyone else."

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