The Quest For The Golden Ring - The Great Plains Power Station - Part Three
With Moose Jaw not the only location considered for the presently under construction 360 megawatt natural gas fired electrical generating station - Great Plains Power Station - MJ Independent wanted to take a behind the scenes look at the runup to the final decision.
How did Moose Jaw win the competition for the plant and what did it take to do so?
To accomplish that we launched what would turn out to be our largest Freedom Of Information (FOI) effort ever and asked SaskPower for the documents.
We received not only hundreds of documents but also audio recordings of some of the behind the scenes machinations leading to the eventual decision to construct the plant in Moose Jaw.
It is a story that entails hard work, effort, boosterism, the largest embezzlement in German history, greed and in the end seemingly a lot of luck.
To See Part One click here To see Part Two click here
By Robert Thomas
With the Belle Plaine having an unspecified - but major - cost advantage over top of Moose Jaw when it came to the needed gas and electrical transmission lines there were other costs which worried SaskPower.
Costs which ironically were there because of another project which had been a major benefit to Moose Jaw - the K + S potash mine.
But how could a potash mine have a major effect on costs for the Belle Plaine site?
The answer is simple.
It had to do with the CP Rail, a dedicated railway track to the K + S mine, and the highly inflated price paid for the land the track was built on.
Throughout the SaskPower documents, regarding the proposed Belle Plaine site, there is discussion about the inability to secure land because of the price the landowner wanted for his property.
A June 14, 2017 record of a SaskPower internal video conference (see below) said the asking price for Belle Plaine was “based on CP rail paid to purchase parcels to develop the spur line in the area.”
CP Rail had paid $10,000 to $20,000 per acre for the spur line to the K + S mine.
The document would go on to state SaskPower “cannot justify” the $10,000 per acre asking price.
But said the Crown corporation could justify an amount which was redacted in the FOI documents. (See below)
SaskPower’s documents further show Belle Plaine’s attractiveness for the plant.
The pros and cons of raising the offer price to the landowner was discussed internally by SaskPower.
The Belle Plaine site was still preferred by SaskPower as “Belle Plaine is still believed to be economically advanced over Moose Jaw with the cost implications for the related interconnection and switching station.”
A major drawback of raising the asking price was the effect it would have on SaskPower’s reputation of fairly acquiring easements throughout the province.
There was also worries about outside interference when it came to buy land above market price.
Politically the Minister’s office was starting to ask questions if SaskPower was paying above market value for land.
To get around the preferred site's high asking price SaskPower would mention relaxing their criteria and look at other not so attractive sites in Belle Plaine.
The biggest question is if the Belle Plaine site was superior why not simply expropriate the land and then continue to develop there?
There are two reasons.
The first is time.
If the land had to be expropriated it would take time and SaskPower had a timeline that potentially could take months if not years in court to complete.
The other was public perception.
With Moose Jaw in the mix SaskPower - ever conscious of the public’s perception - was concerned about the response given the support for the project.
Despite difficulties in acquiring access to study the feasibility of the land SaskPower nevertheless continued to look at the Belle Plaine option right up until the final location decision was made.
An internal SaskPower email shows as late as August 21, 2018 the landowner at the Belle Plaine would not budge on his $10,000 per acre asking price.
SaskPower put considerable effort studying land values in the Belle Plaine area.
The prices CP Rail paid for land to construct the spur line to the K + S mine to the CPR’s main line were finally dismissed as not part of the average land cost multiplier as they “were seen under extreme circumstances” an October 11, 2018 internal SaskPower email stated.
On October 15, 2018 the Belle Plaine site passed its environmental assessment with no environmental contamination detected at the proposed site.
Transport Canada Approval Needed
While the Belle Plaine option was having problems there were unique problems with the proposed Moose Jaw location.
Concerns which went beyond acquiring the land necessary for the required electrical and gas transmission lines.
Concerns about the three sites at Moose Jaw's industrial park were due to the location of the industrial park in relation to 15 Wing Moose Jaw.
In order for the proposed plant to be located in Moose Jaw’s industrial park Transport Canada had to give its OK.
The OK could not be granted to the plant until it was proven the proposed plant would not interfere with the aviation operations at the Base.
SaskPower had numerous documents discussing how selecting Moose Jaw as the plant’s site would have to wait for Transport Canada’s approval (see document below).
In an internal SaskPower report the necessity to satisfy 15 Wing Moose Jaw the plant would not interfere with the military’s operations meant if the Base said no then SaskPower would chose Belle Plaine.
“If SaskPower is unable to satisfy 15 Wing Moose Jaw’s concerns for the plant, SaskPower will need to change the location of the plant to Belle Plaine,” the report read. (See below)
The big question which could be asked why was SaskPower so impatient with choosing a site?
Why the need for greasy fast lightning speed as mentioned in Part Two of this trilogy of articles?
Once again the entire issue rested with what was happening in Ottawa.
It went beyond the impending Carbon Tax but also the pending Federal Environmental Impact Assessment Act was expected to take effect in the spring of 2019. For SaskPower the new Act would introduce considerable risk to the timelines set to develop the new plant.
In late August the problems with the Moose Jaw sites continued.
SaskPower was set to sit down and speak with 15 Wing Moose Jaw about the plant’s thermal plume and those discussions were crucial.
“-We’re not sure what 15 Wing will say to the assessment. It could be a very different conversation with Moose Jaw if the thermal is a show stopper to their operations,” Sarah Klein Bentley wrote in an August 23, 2018 email.
If the conversation was positive Bentley wrote then she asked if everyone could be brought together to recommend their preferred site and take out an option on the land.
On December 13, 2018 SaskPower issued a Decision Item to their Board of Directors.
The recommendation was to chose Moose Jaw over top of Belle Plaine pending approval by 15 Wing Moose Jaw.
According to the report if 15 Wing said no to the proposal then the recommendation was to proceed with the Belle Plaine site and acquire the land through expropriation.
A process which may require court time.
Moose Jaw was chosen due to SaskPower’s need to get generating power online by 2024. Something the Belle Plaine site could not do due to the lengthy indecision to acquire the over market price location.
Off Site Levy Torpedo In The Water
With Moose Jaw receiving SaskPower’s bureaucrats approval all seemed well.
But on the very day the confidential report went to SaskPower’s Board Of Directors to approve the Moose Jaw site the City inadvertently threw a knuckle ball that jeopardized the entire deal.
The knuckle ball was the off site levies.
Off-site levies is the amount the City charges all new developments on top of what they pay for the land.
The fee is to compensate the City and fund other amenities as well as infrastructure that the development benefits from.
The Off Site Levy has been sited as the reason why Carpere Limited decided to back out of what was touted as the largest land deal in the City’s history.
A blockbuster deal which would see Carpere given exclusive rights to develop the new industrial park and attract industry to build there.
The Off Site Levy was likewise a stumbling block for SaskPower.
Initially SaskPower had a proposal from the City - dating back to 2016 - about the need for the Off Site Levies to be paid.
The documents in the FOI do not show how a preliminary agreement was seemingly missed until the last moment but it needs to be noted the two main negotiators in 2016 - former Econonic Development Officer Deb Thorn and City Manager Matt Noble - were no longer with the City.
In a December 13, 2018 email (see below) present day city manager Jim Puffalt wrote the City had proposed an Off Site Levy to SaskPower of $32,804 per acre in the 2016 preliminary proposal.
Puffalt made a case for SaskPower to pay the levy because by selecting Moose Jaw there were massive savings.
Puffalt would state by using the City’s sewage treatment plant SaskPower would save money by not having to construct on-site evaporation ponds.
Money it is assumed a portion of which could be used to pay the Off Site Levy to the City with.
City Manager Jim Puffalt’s email to SaskPower about paying the Off Site Levies - source SaskPower FOI
Unbeknownst to the City negotiators SaskPower internally was blindsided by the need to pay the Off Site Levy.
It took the Crown corporation about two hours to send out an internal email about it on a Thursday evening.
The documents show SaskPower was confused not only about the need to pay the levy, and if they had to exactly what the Off Site Development Levy had to be paid on.
In a December 13, 2018 email SaskPower’s Sarah Klein Bentley would write “under their proposal that was sent in 2016, they stated only “developed acreages” had development levies…also, with the way the costs are laid out…it leaves room for interpretation.”
SaskPower sat down to study the issue according to the documents.
Internal email where SaskPower appears blindsided by the need to pay offsite development levies
There are no further emails or reports in the FOI release about what SaskPower internally discussed when it came to the 2016 proposal to pay the Off Site Development Levy.
But they fought back with their own version of a knuckleball.
To get out of the need to pay the Offsite Development Levies - as initially proposed - SaskPower played politics.
In a December 16, 2018 letter to then Mayor Fraser Tolmie SaskPower wrote the corporation had to be “consistent” with everyone and as such did not pay development levies.
Mike Marsh with SaskPower’s Executive Office wrote the former Mayor stating the major benefits the proposed plant would bring to Moose Jaw.
How the plant would serve as the anchor tenant for the new industrial park that was at the time sitting empty. A park the City desperately needed someone in after the Canadian Protein Innovation debacle.
Marsh wrote “this facility will bring more business, employment opportunities and families into your community.”
Ironically it was almost the exact opposite of what SaskPower had said internally about how the City seemingly did not understand the true final impact the plant would bring.
In many ways it was a reversal of rhetoric or an echo chamber back at the City.
The letter then took a hard stance on the partnership between SaskPower and the City showing who controlled the on-off switch for the plant.
SaskPower would go on to state “if a land option agreement cannot be made in a timely way, we will be forced to consider other options.”
The letter was a take it or leave it partnership.
In the end the City agreed with SaskPower.
The off site levies would later be mentioned as part of Council’s discussion with the simple response SaskPower does not pay them.
Epilogue
The date July 9, 2021 was a major day at the site of the Great Plains Power Plant.
At the restricted media event, then Mayor Tolmie, would state the day was to celebrate those who had “overcome the obstacles and challenges presented along the way” to get the plant to Moose Jaw.
“This project was not originally earmarked for the City of Moose Jaw but our dedicated team was able to recognize the opportunity this project would mean for the community of Moose Jaw. And the opportunities that would present themselves because of this project,” former Mayor Tolmie would tell those gathered.
Moose Jaw had its’ plant.
Sod Turning on the site of the Great Plains plant - photo credit City of Moose Jaw
But when you look at SaskTel’s internal documents acquiring the Great Plains Power Plant certainly took work but in the end the true facts of why Moose Jaw was selected - according to SaskPower’s internal documents - was really a whole lot of IFs or what IFs that in reality the community had no control or influence over.
And that's the true story about how Moose Jaw got its natural gas power plant presently under construction.