Nfld Wants More Federal Money...

[Wild Bill]

Wild Bill, you don't have to yell.

Yes August, I feel I do have to yell! Are you blind? The price per kilowatt hour was in the largest print of all!

1/4 to 1/5 of a penny per kilowatt hour! How much do you pay for your electricity, August! That purchase price is absurd and gives a FANTASTIC profit margin to Quebec Hydro! It's like conning someone into supplying you new cars for your dealership at $50 per car!

If you think a price like that is fair, even at the time the deal was signed, then I crown you the greatest robber baron in history!

Meanwhile, just what do you have against Newfoundland anyway? I mean, the sight of a Quebecer knocking the idea of the feds giving a province money - isn't that rather hypocritical? How did the rest of Canada benefit from federal money given to Olympic Stadium?

Edited November 18, 2010 by Wild Bill

[Topaz]

If Ottawa can give Alberta 1.05 Bil for oil development than it can give any province money to help with their affairs. Harper is the PM of Canada not just Alberta.

[Shady]

If Ottawa can give Alberta 1.05 Bil for oil development than it can give any province money to help with their affairs. Harper is the PM of Canada not just Alberta.

Wrong. It's about using money wisely. Alberta provides billions of dollars in tax revenue for the federal government. So it's a good return on an investment. The Nfld deal is just pouring money down the drain.

[guyser]

Wrong. It's about using money wisely. Alberta provides billions of dollars in tax revenue for the federal government. So it's a good return on an investment. The Nfld deal is just pouring money down the drain.

Yeah cuz no one, corporate or otherwise pays taxes in N&L .

[Shady]

Yeah cuz no one, corporate or otherwise pays taxes in N&L .

Nice strawman. Nobody's suggested that.

[Smallc]

Nice strawman. Nobody's suggested that.

Then what are you suggesting? This deal will produce $6.2B in economic activity.

Edited November 19, 2010 by Smallc

[guyser]

Nice strawman. Nobody's suggested that.

You are nobody then because that is what you suggested. Dont recall do you? Look up a few posts, its allthere under Shady.

Ah hell, youre challenged so here you go

Alberta provides billions of dollars in tax revenue for the federal government. So it's a good return on an investment. The Nfld deal is just pouring money down the drain.

But let me guess....you dont agree.

[blueblood]

Then what are you suggesting? This deal will produce $6.2B in economic activity.

That will be just for phase 1. There is still yet another part of the Lower Churchill that can be developed.

Let's not forget that they won't be shuttering any of those coal and oil plants. Why? They aren't going to be throwing money away. They would be wanting as much electricity to go south as possible.

They are just talking about this on the Lang and O'Leary exchange, and the premier of NS stated that this project is a boon to Atlantic Canada and is looking at doing another phase in NFLD.

Another thing that they were talking about is that Quebec will have to renegotiate rates, because they could very much be milking a dry cow if they go about developing Phase 2. And considering that by 2030, Quebec could be in financial kaka, they should look strongly at renegotiation.

[Shady]

Then what are you suggesting? This deal will produce $6.2B in economic activity.

Of course it will.

[Smallc]

Of course it will.

It will. why wouldn't it? How much money does Hydro Quebec make ever year? As blueblood says, this is only phase one. The project will only get larger and better.

[Shady]

The project will only get larger and better.

Of course it will. Because if there's one thing we can trust, it's government fiscal projections.

[blueblood]

It will. why wouldn't it? How much money does Hydro Quebec make ever year? As blueblood says, this is only phase one. The project will only get larger and better.

Not only that, there is a major private utility heavily involved in this which is paying out a nice dividend. Given that energy use is supposed to keep increasing over time, how is this not a money maker for any party involved? Not only that, hydro doesn't run out.

[Smallc]

Of course it will. Because if there's one thing we can trust, it's government fiscal projections.

Did you miss the part about the private partner? I know you're automatically programmed to hate anything government, but seriously.

[August1991]

How does this benefit Canada, you ask? If it benefits any Canadians, such as Newfoundlander and Labradorians and Nova Scotians, then it's a benefit to Canada. As a Canadian, and yes I am one, I find that a little bit insulting.

Of course if something benefits Newfoundlanders, it also benefits Canadians. The question is whether taking money from people elsewhere in Canada and giving it to Newfoundlanders is of net benefit to Canada.

One could argue that this not only benefits Canada and ALL Canadians, but the world by possibly eliminating a potent greenhouse gas emitter.

Wouldn't you agree?

NC, it seems to make sense to use the hydro of Muskrat Falls to replace the power generated at Holyrood. But the more I read about this project, the more I shake my head.

The two high voltage direct current (HVdc) lines across the Strait of Belle Isle will cost over a billion dollars to construct.

To deliver this energy to market will require another subsea cable across the Cabot Straight to Nova Scotia. There is currently no proposal or costing of this option.

The only other alternative requires building another power line through Quebec with the cost and 'wheeling' rights through Quebec.

Sierra Club

Is the Sierra Club a reputable source? Dunno. But it seems to me that if it's a good project, then Nacor will find financing to build the 20 km undersea cable from Labrador to Newfoundland.

-----

Do regions use the federal government to get money from Canadians elsewhere in Canada? Of course. Should they? Dunno. Montreal (pop. 1.6 million) needs a new highway interchange. Projected cost is about $3 billion. PEI (pop. 140,000) got a $1 billion bridge.

But as someone else noted, Nfld has 7 MPs. PEI has 4. Maybe someone should do a subsidy/MP calculation. In which province are MPs cheaper?

Did you miss the part about the private partner? I know you're automatically programmed to hate anything government, but seriously.

What private partner?

Aside form the direct $375 million subsidy, this project is also asking for federal government loan guarantees to get financing.

The federal government has not yet decided on an application to defray the cost of the underwater link and a separate request for a loan guarantee.

CBC Edited November 19, 2010 by August1991

[punked]

What private partner?

Emera is investing a BILLION DOLLARS!

[August1991]

Emera is investing a BILLION DOLLARS!

But to get the money, it requires a government loan guarantee.

This deal will produce $6.2B in economic activity.

I love mindless statistics such as "economic activity", "spinoff effects" or "indirect job creation".

In theory, if I spend a $10 at Provigo, and the Provigo cashier uses the $10 (her salary) later to buy a meal, and then the restaurant waitress uses the money to buy a cinema ticket... Well, you can see where this can lead to. My $10 bill might lead to the entire world GDP.

The $6.2 billion economic activity statistic is a meaningless, invented number. Money doesn't have to go through my taxes, the government, a subsidy to someone else to create "economic activity".

Not only that, there is a major private utility heavily involved in this which is paying out a nice dividend. Given that energy use is supposed to keep increasing over time, how is this not a money maker for any party involved? Not only that, hydro doesn't run out.

BB, if it's such a good investment, then the private sector (ie. people like you and me) will happily invest in the project.

In general, and I say this with a great deal of thought for historical experience, politicians and government bureaucrats are not good at picking winners.

Successful societies generally don't let politicians or bureaucrats (even those chosen through democratic means) make critical decisions about where to invest resources for the future.

-----

The bottom line here is that the critical resource is not a waterfall in Labrador. It is access to a market with people who want electricity. Quebec has the valuable resource.

Danny Williams should put aside his ego for a few minutes and sit down with people from Hydro-Québec and negotiate a deal. Both sides would benefit - and no Canadian would have to provide a subsidy. But for this to happen, Williams would have to be human, humble.

I know that the perception in English Canada is that Quebec screwed Newfoundland in the Churchill Falls contract. What English Canadians fail to realise is that without Quebec, there would have been no financing of the project. Investors wanted to know that Churchill Falls hydro had customers.

Edited November 19, 2010 by August1991

[punked]

Danny Williams should put aside his ego for a few minutes and sit down with people from Hydro-Québec and negotiate a deal. Both sides would benefit - and no Canadian would have to provide a subsidy. But for this to happen, Williams would have to be human, humble.

I know that the perception in English Canada is that Quebec screwed Newfoundland in the Churchill Falls contract. What English Canadians fail to realise is that without Quebec, there would have been no financing of the project. Investors wanted to know that Churchill Falls hydro had customers.

Yep to bad Quebec didn't look to the future where we can run cables through the water. Maybe if they didn't hold NFLD hostage because they were the only way to develop Chruchill Falls we would be in a different place now. However we aren't Quebec made its bed. Looks like NS will get clean renewable power, NB will as well. A stronger Atlantic Canada, two routes from power to get to the US and a stronger NFLD. You can cry all you want diversifying and extending this power to Atlantic Canada is good for Atlantic Canada and for Canada as a whole.

Edited November 19, 2010 by punked

[August1991]

1/4 to 1/5 of a penny per kilowatt hour! How much do you pay for your electricity, August! That purchase price is absurd and gives a FANTASTIC profit margin to Quebec Hydro!

Yes, and oil under the Beaufort Sea only costs $1/barrel to extract giving a FANTASTIC profit since the world price is over $80/barrel.

Unfortunately, the oil in the Beaufort Sea is thousands of kilometers from anyone who wants it. And getting the oil to customers will cost $50 or $60 dollars per barrel. (I made up those stats.)

Danny Williams is like someone who owns the oil under the Beaufort, sees the world price of oil and is angry when he only gets $1/barrel for his oil. Danny Williams is Tim Horton's widow, with a bigger ego.

It's the depiction of Horton's wife, Lori, though, that is the most devastating in the book. "A player's wife can be an asset or a liability," he writes. "Lori was the latter, and you never knew when she'd explode." The book describes her as a selfish attention seeker, and details embarrassing scenes in which Lori threw hysterical, public fits of anger, one time even flattening the tires on several of Horton's friends' cars after a particularly nasty blow-up.

As I say, Danny Williams made his money in federal cable TV rights. Joey Smallwood never made any money - cable TV rights didn't exist in the 1940s.

----

Their politicians have badly served Newfoundlanders. Even a quick glance at their long history shows that Newfoundlanders are better people, manage their private affairs better, than their St. John's leaders, or their leaders abroad.

Edited November 19, 2010 by August1991

[blueblood]

BB, if it's such a good investment, then the private sector (ie. people like you and me) will happily invest in the project.

In general, and I say this with a great deal of thought for historical experience, politicians and government bureaucrats are not good at picking winners.

Successful societies generally don't let politicians or bureaucrats (even those chosen through democratic means) make critical decisions about where to invest resources for the future.

-----

The bottom line here is that the critical resource is not a waterfall in Labrador. It is access to a market with people who want electricity. Quebec has the valuable resource.

Danny Williams should put aside his ego for a few minutes and sit down with people from Hydro-Québec and negotiate a deal. Both sides would benefit - and no Canadian would have to provide a subsidy. But for this to happen, Williams would have to be human, humble.

I know that the perception in English Canada is that Quebec screwed Newfoundland in the Churchill Falls contract. What English Canadians fail to realise is that without Quebec, there would have been no financing of the project. Investors wanted to know that Churchill Falls hydro had customers.

It's a solid enough investment when the company pays out a dividend and it's share price has gone up 90 cents based on this news, sounds like we have some happy investors. August, China is a heavily gov't controlled space, yet it allows for private investment. Companies invest in these emerging markets partly because the gov't gives some reassurance that these companies will get a return on their investment. Ordinary people are freely investing in this project as well as paying taxes for it. The ones smart enough to invest will be the winners.

Here's the deal August and you can ask anyone involved with negotiations with landowners to gain access for pipelines and the such, if the landowner wants too much of a cut and it is more cost effective to go around, that's what will happen.

The bigger issue is the conference board report that suggests in 2030, Quebec may be in a financial crisis to the tune of 45 billion dollars. Ordinary Canadians are going to be footing the bill because the Quebec government couldn't manage a hamburger stand. Quebec's government is a mismanaged, entitled gong show, and Danny Williams has found some allies with the same resource Quebec has. If Quebec doesn't like it they can negotiate with Williams, considering their debt situation it would be wise too. Quebec's resource has just evaporated with this procedure. Danny Williams has turned the tables on Quebec, and there isn't a damn thing that they can do about it.

Considering the mammoth amount of transfer payments that Quebec burns through every year with no return to ordinary Canadians, to complain about a project that costs a fraction of what transfer payments are to Quebec and that this project will provide returns in perpetuity; is flat out hypocritical. If this project reduces transfer payments to Atlantic Canada, then Canada as a whole wins.

It's quite simple really, Quebec has squandered this resource much like Ed Stelmach chased out oil developers out of his province into Saskatchewan by hiking royalties. Quebec is about to be in Stelmach's shoes and will have to charge reasonable rates if they want development there. NS has the same resource Quebec does and is giving them a better deal. Considering that Hydro-Quebec is a crown corp that has relied on tax dollars to get set up themselves, to complain about tax dollars going to another crown corp is a waste of time. Can I buy shares in Hydro-Quebec?

[Guy M]

I'm all for it... Too much coal power in the maritimes, theses emissions make their way to us in Quebec too.

My only concern is that NL seems hell bent on getting the cable and bringing their power straight to the US.

I say if you want the federal goverment subsidy, make sure that power goes to Labrador / NL / NS / NB first. If this is just to make money by way of exports, this project does not really benefit Canada.

Quebec needs to make a mental note... ask for subsidies when the Romaine river comes online... Check back into theses threads when that happens and watch everyone`s positions doing a full 180!!!

Edited November 21, 2010 by Guy M

[Guy M]

Considering the mammoth amount of transfer payments that Quebec burns through every year with no return to ordinary Canadians, to complain about a project that costs a fraction of what transfer payments are to Quebec and that this project will provide returns in perpetuity; is flat out hypocritical. If this project reduces transfer payments to Atlantic Canada, then Canada as a whole wins.

It's quite simple really, Quebec has squandered this resource much like Ed Stelmach chased out oil developers out of his province into Saskatchewan by hiking royalties. Quebec is about to be in Stelmach's shoes and will have to charge reasonable rates if they want development there. NS has the same resource Quebec does and is giving them a better deal. Considering that Hydro-Quebec is a crown corp that has relied on tax dollars to get set up themselves, to complain about tax dollars going to another crown corp is a waste of time. Can I buy shares in Hydro-Quebec?

Quebecers are ordinary Canadians that also pay a mammoth ammount of taxes to the federal goverment, and receive transfers and equalization at a rate that is about midpack between the provinces... less than NS/NS/PEI/Manitoba. More (but not much more) than Ontario/BC...

Of course the fiscal situation is going to be difficult with a lagging economy and lots of aging baby boomers to take care of. The same thing will happen in much of Canada as well. We're all in the same boat.

Hydro-Quebec is not perfect, but its a stretch to say we've squandered the hydro ressources... I'd say we've planned our power generation better than most. How many provinces have energy corporations that can export significantly, supplies lots cheap reliable energy to their citizens, draw energy hungry mills and jobs like ALCAN /ALCOA, and turn a profit in the process?

Edited November 21, 2010 by Guy M

[punked]

Quebecers are ordinary Canadians that also pay a mammoth ammount of taxes to the federal goverment, and receive transfers and equalization at a rate that is about midpack between the provinces... less than NS/NS/PEI/Manitoba. More (but not much more) than Ontario/BC...

Of course the fiscal situation is going to be difficult with a lagging economy and lots of aging baby boomers to take care of. The same thing will happen in much of Canada as well. We're all in the same boat.

Hydro-Quebec is not perfect, but its a stretch to say we've squandered the hydro ressources... I'd say we've planned our power generation better than most. How many provinces have energy corporations that can export significantly, supplies lots cheap reliable energy to their citizens, draw energy hungry mills and jobs like ALCAN /ALCOA, and turn a profit in the process?

Quebec gets around 17 Billion in transfers a 6 Billion of it is Equalization. Nova Scotia gets around 2.5 Billion and around 1 Billion is equalization. So lets not be crazy here.

[Wild Bill]

I know that the perception in English Canada is that Quebec screwed Newfoundland in the Churchill Falls contract. What English Canadians fail to realise is that without Quebec, there would have been no financing of the project. Investors wanted to know that Churchill Falls hydro had customers.

You still don't get it, August. Or you're dodging it, perhaps. People understand perfectly that Newfoundland needed someone to ensure financing. They also understand that if the electricity had to be carried across Quebec she certainly would be entitled to be paid for the service.

What has caused the hard feelings is the EXORBITANT price Quebec has received! It is SO high that it is equivalent to robbery! And the fact that it was locked in for decades was salt in the wound.

It's as if someone held a gun to YOUR head and told you "You will rent me your home for 100 years, for $50 per month!"

Newfoundland had no choice but to sign the Churchill Falls deal. They were so close to the deadline that if the deal fell through or they walked away the cancellation charges and the charges against the committments they had already made would have bankrupted them. So they did what they had to do, but of course they have never forgotten.

The history is moot anyway, August. Even if they hadn't signed the Churchill Falls deal, they now have an opportunity to make a deal with Nova Scotia. Why not? Where is it written that they MUST deal with Quebec? Hell, there's no guarantee that Quebec will even be part of Canada within a few decades. If that became the case, Newfoundland would owe Quebec nothing more than they would owe Germany, Botswana or any other foreign country.

For that matter, neither would the rest of Canada.

[Smallc]

Quebec gets around 17 Billion in transfers a 6 Billion of it is Equalization. Nova Scotia gets around 2.5 Billion and around 1 Billion is equalization. So lets not be crazy here.

If you can do math, you'll see that means that Nova Scotia is getting more. He is wrong though in that Quebec gets much more than Ontario or BC.

[TimG]

Quebec didn't need "inside information". It's painfully obvious to everyone that without access to a market, Newfoundland has no valuable hydro resource at all.

Are you actually arguing that that Quebec Hydro's grid was built without one cent of subsidy from taxpayers? I doubt it. I generally dislike subsidies for things like this but I will make an exception because I dislike monopolies and the abuses that come with them even more. Your own BS justification for exploiting Newfoundland because Quebec Hydro currently has a monopoly further convinced me that this is one subsidy project I can support under the category of 'building infrastructure that enables an efficient market'. Edited November 21, 2010 by TimG