Public utilities board lawyer says Muskrat review was rocky from Day 1

Lawyer Maureen Greene says she took it personally in the spring of 2012 when political leaders in Newfoundland and Labrador began attacking the public utilities board.

The very public criticism came after the PUB failed to reach a conclusive decision on a matter related to Muskrat Falls, and whether it was the least-cost option for the province's future electricity needs.

"It's not the result you hope and expect when you're involved in this type of process," Greene said Wednesday during a full day of testimony before the Muskrat Falls inquiry in St. John's.

'Sick of you and your damn board'

Jerome Kennedy, then the minister for Natural Resources,accused the board of failing to complete its mandate and showing a lack of respect for the task it had been given.

Then-premier Kathy Dunderdale was quoted as saying the board had "walked away from its responsibility" after spending more than $2 million on a review process.

And according to notes submitted into evidence by former board chairman Andy Wells, Dunderdale phoned Wells at one point and said, "I'm sick of you and your damn board."

Greene was the board's legal counsel during a very tense period in the lead-up to sanctioning of Muskrat Falls.

The province's energy regulator was asked by Dunderale's administration to carry out a review to determine whether the best option wasMuskrat and the Labrador-island transmission link, or the isolated island power grid.

A 'very challenging' request

Nalcor had already determined through its own studies that Muskrat Falls was the best choice. But faced with intense public pressure, the provincial government decided to send what's called a "reference" to the PUB, despite exempting the regulator from oversight of the controversial project.

The board was given six months, beginning in June 2011, to come up with an answer.

Greene had her doubts from the very beginning.

"To do this type of analysis in a six-month period would be very challenging," she told inquiry co-counsel Barry Learmonth during questioning.

And according to Greene's testimony, and numerous letters and documentation entered into evidence Wednesday, Nalcor didn't make the process any easier.

She said a very complex review was hindered by the flow of information, and in some cases no information at all.

The documentation that came was disappointing in terms of volume and significance of it.- Maureen Greene

"The documentation that came was disappointing in terms of volume and significance of it," she said.

Despite repeated letters to Nalcor, and even intervention from government ministers at one point, the flow of information was barely a trickle.

By September, Greene knew the government-imposed deadline of Dec. 30, 2011, "would not be achievable"

Nalcor refused to provide some documentation, saying it was outside the PUB's terms of reference.

Andy Wells even went to the media, criticizing Nalcor for the "incomplete nature of their replies."

This attracted a letter to the board from then-Nalcor CEO Ed Martin, who referred to the "extraordinary efforts" of the government-owned corporation to provide information to the board.

Deputy minister gets involved

The repeated letters from Greene to Nalcor even got the attention of Charles Bown, deputy minister of Natural Resources, in October 2011.

Greene said she received a phone call from Bown, which she described as "unusual from the normal process" while a matter was before the board.

Greene later met with Bown, who told Greene he was "surprised I had not contacted him before sending the letters to Nalcor."

Greene said she replied,"I would never have thought of calling you in advance. This is a board process."

The flow of information improved by that fall, but it was too late, according to Greene.

A request for a six-month extension was denied, and a new deadline of March 31, 2012, was imposed.

Board using outdated information

The board presented a report by this new deadline, but attracted the wrath of provincial politicians after it said members wereunable to reach a conclusion on which option was best.

The board said the information provided by Nalcor on issues like cost estimates and project engineering was "considerably less detailed and comprehensive" than what was available at the time.

Greene said there was an expectation that the PUB base its review on information available in 2010, when Nalcor and Emera signed an agreement to develop Muskrat Falls.

But she said a lot had changed in the months since, and the project was eventually sanctioned at a construction cost of $6.2 billion, which was considerably higher than the 2010 estimate of $5 billion.

They struggled to the very best of their ability based on the information that they had, to conduct a fair and impartial and transparent process, and to provide a report that would adequately address the question.- Maureen Greene

"The board does not believe that it is possible to make a least-cost determination based on a concept study or feasibility level of information generally from November 2010 which was intended only to ground Nalcor's decision to move to the next phase of the analysis," the board wrote in 2012.

When asked if the board failed, as was alleged by some political leaders at the time, Greene responded "absolutely not."

"They struggled to the very best of their ability based on the information that they had, to conduct a fair and impartial and transparent process, and to provide a report that would adequately address the question."

Meanwhile, the inquiry is scheduled to hear from other current and former members of the PUB on Thursday.

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