Never heard of the continent-wide 'Grand Canal' water-transfer project?
Not surprising - the elite aren't too keen to publicize it!
The chief proponent of the GRAND Canal scheme, Thomas Kierans of St. John's, Newfoundland, describes his proposal as an "environmental project", one that "fixes the plumbing system of the continent." The scheme, estimated to cost between $80 billion and $130 billion, is novel. But it is only the most recent of many schemes Kierans and other engineers have devised to capture the waters of Canada's northward-flowing rivers for use in the south - rivers that otherwise are said to "waste their way to the sea."
Kieran's scheme - GRAND being an acronym for Great Recycling and Northern Development - envisages a dike across James Bay and the creation of a new freshwater lake through the impoundment of rivers that now empty into the bay. This fresh water would then be pumped back to the Great Lakes basin and beyond. Water which would otherwise be "totally lost" would, therefore, be "recycled" and, Kierans argues, put to better use by addressing four problems simultaneously:
Kierans is adamant that the GRAND Canal system, whatever the criticisms, is the only way that the water problems now facing 160 million Canadians and Americans can be addressed. It is a project for the 21st century, he says. "The idea is to get wasted water from the wrong places to the right place. Why should the Prairies remain water deficient?" Rejecting the export label others have attached to his idea, and insisting instead that he is creating new fresh water and recycling it, Kierans is convinced that he has the solution. It is a conviction he pursues with zeal and diarming salesmanship.
In his book POWER FROM THE NORTH, Quebec Premier Robert Bourassa strongly promotes studies of the GRAND Canal scheme. The venture is backed by powerful engineering companies - the UMA Group, the SNC Group, Bechtel Canada Ltd., and Rousseau, Sauve, Warren Inc. Kierans says that Lavalin, Canada's largest engineering company [and Energy Minister Marcel Masses' previous employer] is courting GRANDCO. Even Atomic Energy of Canada Ltd. [AECL] is contractually involved, with hopes of supplying CANDU reactors to power the pumps that will have to move water south from the James Bay water-shed in amounts equivalent to 30 per cent of the discharge of the Great Lakes. In addition, the GRAND Canal scheme has been described by Canada's free trade negotiator, Simon Reisman, as the most important bargaining leverage Canada could exercise. In a 1985 article on Canada- United States trade in the CANADIAN BUSINESS REVIEW, Reisman stated: "This project could provide the leverage to a free-trade agreement with the United States containing terms and conditions that would meet many Canadian concerns about transition and stability."
Kierans has been advocating the project since the early 1960's. Within the last several years it has taken a more substantive corporative form. GRANDCO is a privately- held St. John's [Newfoundland] company incorporated on 15 October 1984. Its nine directors are drawn from engineering companies, AECL, academia, and elsewhere in the private sector. The chairman of the board, Louis Desmarais, was a Liberal member of parliament from 1979 to 1984 and is now president of J.D.E. Consulting Services Ltd. and chairman of Canadian Home Assurance Co. With past involvement at the most senior levels of Power Corporation and Canada Steamship Lines, Desmarais is GRANDCO's high-powered political and business "door opener".
Trained as a mining engineer and a veteran of the Churchill Falls project, Kierans is the major GRANDCO shareholder. He and an assistant are the part-time staff. Investors are the various engineering companies, which obtain shares through work in kind and cash. A seperate entity, the GRANDCO Joint Ventures for Engineering, is headed, again on an as-needed basis, by Gilles Mariner, who recently returned to the SNC Group from the James Bay Energy Corporation. The joint venture is made up of the engineering companies on the GRANDCO board and has the exclusive contract for technical studies associated with the scheme.
Money is a problem for GRANDCO. Kierans says the company has spent the equivalent of $750,000 in cash and services in kind since its establishment. Seven studies have been completed, covering subjects from a corporate development strategy to James Bay dike locations and routing of water to the Midwest and Prairies. These studies are not public. A 1985 request for $763,000 from the federal Department of supply and Services [DSS] and the National Research Council [NRC] created sufficient controversy in Ottawa to cause it to end up in the Prime Minister's Office. The request was turned down, but Kierans eventually managed to obtain $30,000 from the public purse through the NRC branch in Newfoundland. Two public servants involved in responding to Kierans' requests at the time were Art Bailey, Senior Assistant Deputy Minister at DDS, and Keith Glegg, Vice-President of Technology Transfer at NRC. Glegg says his and NRC's interest has always been to investigate matters so that there can be a better understanding of issues raised by the scheme. Bailey retired from DSS in 1984, and for one year acted as the head of public relations in Ottawa for GRANDCO. Although no longer associated with the company, he is listed by the Department of Consumer and Corporate Affairs as one of its founding directors.
Kierans says another $1.5 million to $2 million is needed for engineering and promotion before major investors can be approached for the $10 million needed for detailed studies. The major investors, he says, are resisting because of the "intransigent opposition from Environment Canada." It is not quite that simple.
Semantics, it seems, are everything. Although Kierans bristles at the characterization of his project as a water-export scheme [rather than a "recycling" scheme], the GRAND Canal project is predicated on the transfer of huge volumes of water into the United States from the Great Lakes, and that is made possible only by the dedication of waters flowing into Canada's James Bay. However it is phrased, such a transfer runs contrary to stated federal policy which, as the recent Pearce Inquiry on Federal Water Policy established, is reinforced by solid public opinion.
Whatever Reisman's personal conviction [and that can be ignored only in the long run at great peril] Canada's Minister for International Trade, Pat Carney, says that "water exports" are not on the table in free-trade negotiations. That position has been verified by statements in the House of Commons by Secretary of State for External Affairs Joe Clark. Environment Minister Tom McMillan and his Liberal predecessor have both opposed the GRAND Canal scheme. McMillam maintains that large-scale water "export" would only be considered in the context of a comprehensive federal water policy, which is now being developed. Furthermore, in 1985 the governors of the Great Lakes states and the premiers of Ontario and Quebec signed an agreement to guard against "transfers" or "diversions" to the Midwest or Southwest. These policy positions could change, as Kierans insists they will, when the full impact of water shortages are felt in the decades ahead.
Politics aside, moving, transforming, diverting or exporting water on the scale envisaged by GRANDCO is a Canadian solution to mid-continental water problems that must be subjected to the most thorough and penetrating questioning - now, at the conceptual stage. There is some good work that provides a useful beginning.
In a recent issue of the CANADIAN BULLETIN OF FISHERIES AND AQUATIC SCIENCES, entitled "Canadian Aquatic Resources", Richard Bocking has taken a comprehensive, continental view of water supply-and-demand issues. He provides convincing documentation showing that no responsible authority in the United States, apart from engineering firms and others with a project- specific vested interest, has ever claimed that there is a need for Canadian water. To quote Bocking:
"From promotion to planning to construction, large-scale water projects can easily take 20-30 years or more. Even if rationally conceived, in an era of rapid social, economic and technological change, they risk being totally inappropriate long before they approach completion. With present export proposals such as the NAWAPA or GRAND Canal schemes, we start with no conceivable market, unqualifiable but very great environmental risk, inevatable large-scale social disruption, and the opposition of the vast majority of those Canadians who have expressed views on the subject. The possiblity of a favourable outcome to such an enterprise reaches the vanishing point...Focussed research aimed at deepening our under- standing of our freshwater resources and careful analysis of the impact of past water developments are among the pressing needs in water research. Exploration of the wide range of social, economic and technological alternatives to massive water developments is essential. Then, perhaps, when faced with real problems. we will be able to choose wisely, allowing for the ignorance and uncertainty that will always be dominant. If the best alternative involves manipulation of streams and rivers, perhaps with such a basis of understanding we will be capable of doing that with sensitivity and elegance. For the experience of recent decades demonstrates that conventional large-scale structural solutions to water problems, whether domestic or international, comprise a simplistic, expensive and outdated approach to water resource management."
Article includes a map, entitled THE GREAT RECYCLING AND NORTHERN DEVELOPMENT SCHEME, showing the recycle steps, existing major diversions, and proposed transfer canals which would make up the massive GRAND Canal project across Canada, the Midwest United States and the Southwestern states. It was sourced from: M.C. Healey and R.R. Wallace, eds., CANADIAN AQUATIC RESOURCES, Canadian Bulletin of Fisheries and Aquatic Sciences 215 [Ottawa: Minister of Supply and Services Canada, 1987], p.107.
Peter Rogers, Professor of Environmental Engineering at Harvard University, makes much the same point.
In a keynote address to a November 1986 workshop on water issues sponsored by the Science Council of Canada, Rogers describes the discussion of export on the Canadian side as "having taken on an xenophobic tinge". Noting Anthony Scott's "careful, cool and rational examination of the issues" for the recent Pearce Inquiry on Federal Water Policy [where Scott concludes that the cost of water transfers would be well above what the U.S. market would bear on any conceivable level of subsidization by the U.S. government], Rogers goes on to say: "When viewed from the U.S. point of view, the question of water export [or import] is of considerably diminished importance."
A world view of water issues is helpful. In the Soviet Union, for example, there have been major northward-flowing river diversion proposals motivated by continental water redistribution ideas somewhat similar to the GRAND Canal scheme. But the Soviets' initial enthusiasm has been tempered. Recent scientific delegations to Canada have indicated that such schemes are now seen as quite undesirable. In a 1984 publication entitled WATER: RETHINKING MANAGEMENT IN AN AGE OF SCARCITY, the Worldwatch Institute considers past experiences and future plans, including those in the USSR, Canada and the United States. It concludes:
"In an era of growing competition for limited water sources, heightened environmental awareness, and scarce and costly capital, new water strategies are needed. Continuing to bank on new large water projects, and failing to take steps toward a water-efficient economy, is risky: Vital increases in food production may never materialize, industrial activity may stagnate, and the rationing of drinking-water supplies may become more commonplace.Alternatives to large dam and diversion projects exist. Water crises need not occur...In water-short areas of industrial countries, people and economic activity must begin adapting to water's limited availability. Supplies in Soviet Central Asia, for example, simply cannot support a booming population and an expanding economy for long. Oasis cities such as Phoenix and Los Angeles can no longer expect to grow and thrive by draining the water supplies of other regions. Conservation and better management can free a large volume of water - and capital - for competing uses. Thus far, we've seen only hints of their potential."
Canada can learn from the international context of water management. Rogers described it this way:
"The resource endowment that sets Canada apart from all other countries is something to be thankful for - but it also brings with it large responsibilities. How much of this endowment should Canada save for future generations [of Canadians and populations of other countries] and how much of it should be pledged for economic gain in the short run?...In the area of water resources we should remember that "we get exactly what we pay for". in both Canada and the U.S. the prices charged for water are so low as to be not believable. We deliver a valuable commodity to very wealthy consumers who would be willing to pay substantial amounts more for it, yet receive the commodity practically for free. In no other sector of our economies do we encourage such profligate behaviour. The time has come for a concerted effort to challenge the "water-is-different" syndrome and raise the cost of water for all water users. I believe that the most important lesson to be learned is that people who use and abuse valuable commodities should pay full price for what they use, and the full price of dis-abusing what they abuse.
Combining an aggressive pricing policy with tough environmental laws will enable Canada to get control of its water resources in a way that will be efficient from the point of view of the market and the environment. Everybody will be better off."
Is a $100-billion-plus scheme like Kieran's GRAND Canal really in the national interest? Certainly it is unique. It is based on capturing freshwater at Arctic tidewater and moving it back through canals, rivers, lakes and diversions to benefit areas throughout North America that are "water deficient". But the cost is immense. There are obvious, powerful, vested interests involved. But who would end up paying, and how? The technical appeal of GRANDCO's scheme is one thing. The political, scientific, social, and environmental implications of large-scale manipulations to address water shortages in the Midwest and fluctuating levels in the Great Lakes are another matter. The economic aspects are something else again.
Kierans points to the general ecxonomic boost provided by major water schemes elsewhere. The projects he cites are all predicated on a huge capital and operating cost subsidy, and were undertaken when that subsidy was the norm. That past norm is implicit in the GRAND Canal proposal. It is a controversial assumption upon which the financial viability of Kierans's venture is balanced. It is not, as Kierans often implies, quite as simple as a market need being addressed by private enterprise. The GRAND Canal scheme cannot be undertaken on a "user pay" basis.
Applying the ledger-keeping rigors of the accountant too early in a visionary enterprise can be quite inappropriate, even though apparently rigorous. Nevertheless, when looking at mega-projects like the GRAND Canal, it is helpful to distinguish between economic impact and economic benefit. The former is the financial stipulation resulting from the project, as measured by economic indicators such as Gross Domestic Product; it assumes that if the project did not go ahead, nothing else would take its place. The economic benefit is the net gain or return realized by the investment in the project.
When addressing the advantages of the GRAND Canal, Kierans talks about the Central Valley Project in California and a 1985 study of the impacts of irrigation projects in Alberta. Both point out that only a small proportion of total benefits accrue to the end-user. Although this is true, the two assessments Kierans cites can be fundamentally misleading. They confuse economic impacts with economic benefits.
Building on the cost-benefit approach advocated by Scott's background paper to the Pearce inquiry, Dr Andrew Muller, of McMaster University's Department of Economics, has provided the only systematic assessment to date of Kierans's water development proposal. In a 1986 paper, "Some Economics of the GRAND Canal", Muller concludes that, even setting aside the opportunity costs of exported water and the social and environmental costs incurred during construction and operation, "the quantified costs exceed the benefits by a factor of 6 or 8." Admitting that his estimates are crude, Miller goes on to say:
"These estimates were developed in order to guage the economic feasibility of the GRAND Canal project and to identify the areas in which further information is most urgently needed. The estimates suggest that the GRAND Canal project is not economically viable. Net Benefits are consistently negative...This conclusion arises from the limited benefits which flow from the project. Estimated benefits were small for four reasons. First, both the estimated willingness to pay for exported water and the potential volume of exported water were low. Secondly, the losses from flooding and low water on the Great lakes were estimated to be two orders of magnitude smaller than the estimated costs of GRAND Canal water. Thirdly, care was taken not to confound the economic impact of the project with economic benefits. Finally, only a limited credit was allowed to the project for employment creation.
If futher study of this project is undertaken, the most pressing need is to identify a realistic market for the large volumes of water contemplated. Without such a market, additional discussion seems pointless. If, at prices in the order of $100 to $200 per thousand cubic metres. a market for 67 billion cubic metres of water per year can be found, then high priority should placed on refined estimates of the engineering costs of the project. To be taken seriously, the proponents must demonstrate that it might be possible to deliver a specified flow of water to the Great Lakes for combined capital and operating cost in the area of 100 $S/M1 [Canadian dollars per 1000 cubic metres]. This is one-third the cost estimated [of Kierans's current proposal to direct less than 25% of the total runoff to James Bay].
Much has been made of the social and environmental costs of a GRAND Canal project. Without much more solid evidence of the financial viability of the scheme, it seems pemature to attempt to evaluate these costs with reference to this specific project."
Environmental assessment of the GRAND Canal may be premature. Kierans quite rightly stresses the environmental benefits of bringing water to water- deficient areas. He warns of the serious environmental and social implications of not doing so. And he seeks to downplay criticisms by citing the project endorsement received in the early 1960's from Dr. Ken Hare, a prominent environmentalist at the University of Toronto. Hare, now with the Ontario Nuclear Safety Review Commission, says Kierans overstates his "endorsement". Hare says he is certainly not an advocate of the project; rather, he was intrigued by the option it provides to direct more water into the Great Lakes for level and outflow stabilization. Beyond that, Hare questions the northern social and environmental impacts as well as the feasibility and inter-basin implications of water transfers to the west and south. This kind of concern is best exemplified by the Garrison River Diversion and Canada's hard-line opposition, which is based on the impact of biotic transfer. The prospect of this in a continental water grid is daunting. What, for example, would be the effect of having the sea lamprey distributed throughout the waters of western Canada and the United States?
The best "first cut" at the potential ecological effects of the GRAND Canal on James Bay and Hudson Bay has been done by Robert Milko of the Library of Parliament Research Branch in Ottawa. Milco's paper raises serious questions about possible long-term ecological, oceanographic, and climatic effects. Milko's work, based on a comprehensive literature survey, suggests that changes to the salt-freshwater boundary, known as the pycnocline, may affect short- and long-term productivity at all levels of the food-chain within Hudson Bay and down the Labrador Coast. Fish, seals, polar nbear, whales and millions of migratory birds will be affected, with profound national and international implications. But assessment of the project's impact is speculative, largely because of the lack of scientific knowledge about the region on the part of non-native specialists and the meagre data base currently available. Milko concludes:
"This analysis of the potential ecological effects of the GRAND Canal project indicates that a great deal more research is warranted before such a large-scale diversion is seriously considered. The implications for some of the ecological parameters addressed suggest that large-scale, possibly irreversible detrimental changes to the northern ecosystem would occur. Downstream effects, which receiving areas of the diversion may encounter, have not been addressed but also need to be studied.Specifically, more oceanographic research in Hudson Bay, particularly documenting pycnocline development and its role as a regulator of sea surface temperature, ice pack and primary productivity, is needed. The relationship involving circulation and exchange between Hudson Bay, Foxe Basin, Hudson Strait and the Labrador Sea with regard to freshwater contributions and nutient exchanges must be established. As well, more complete biological inventories and an understanding of their ecological relationships are needed in all potentially affected bodies of water.
These are all complex questions for which long- term monitoring will be necessary in order to establish relationships of ecological parameters through the total range of variability that could be experienced naturally. In particular, data at the limits of the range of variability will be helpful in modelling responses to conditions as extreme as envisioned in the GRAND Canal scheme."
No assessment has been made of the effect of the GRAND Canal scheme on the Cree and Inuit of James Bay and Hudsons Bay region. Kierans talks of jobs and of developing this economically-depressed area - a mega-project solution that has been suggested and tried before in northern Quebec, the Mackenzie Valley, and elsewhere in the North. It should have a familiar ring to aboriginal peoples. Nevertheless, it is a very particular utilitarian mentality that considers the freshwater components of James Bay and Hudsons Bay as "totally wasted". And it is disturbing to see the North again viewed as an empty space, the natural resources of which can be "better" used only to satisfy the appetites of the South. No doubt these shortcomings will be addressed in due course. Kierans simply says: "first things first". To GRANDCO, that means engineering and promotion, for now. But in the process, it would be only prudent to acknowledge the existing aboriginal rights to the northward-flowing rivers of the region. Recent studies at the Institute for Resources Law in Calgary suggest that these constitutionally- enshrined rights could create quite a surprise for enthusiasts like Kierans, Bourassa, and others.
The GRAND Canal is definitely a grandiose scheme. Where Kierans is on solid ground is in his emphasis on present and future problems in the Great Lakes. He is also quite correct in identifying future water problems in some areas of North America. But linking that to James Bay on one hand and to a continental water grid on the other takes some daring, to say the least. Some see that as a kind of visionary genius that goes beyond limited piecemeal approaches. To them, Kierans's determination and dismissal of contradictory views is necessary for the attainment of a goal beyond all the immediate complexities. Many others see that as a throwback to the tunnel vision that creates problems while purporting to solve them. To them, it is a structural, supply-fix approach of questionable feasibility that ignores the true nature of the problem as well as the consequences so evident from the past.
Long-term trends, including climatic change, suggest the need for some kind of new supply to the Great Lakes if levels are to be maintained. It was a point acknowledged, however meekly, in the Pearse Report. That supply focus may seem curious in a year when high levels are a problem - which is why, of course, Kierans's idea of "stabilization" has appeal - but stabilization requires massive inflows [about 50,000 cubic feet per second, according to Kierans] in some years and dedicated massive "exports" whatever the natural cycle of the lakes. When the price tag is $100 billion or more, government subsidies and financial guarantees will be needed on a scale never before seen in North America.
TRANSCRIBER'S NOTE: those readers who are familiar with the Implementation Steps Chart which Shelley Ann Clark [who was involved at the highest level in the Canada-U.S. Free Trade Agreement negotiations] reproduced from memory, detailing the steps involved in the commitment to GRAND Canal's construction and, ultimately, Continental Union, will recollect that it predicted the admission of American Express into Canada as a bank, in order to handle the financing of the immense GRAND Canal project. That has since occurred.
It is all too easy to address a need by conjuring up simplistic, technological fixes to complex social, political, economic and environmental problems. The grander the scheme, the more vast and general its scope, the easier it seems to be to generate enthusiasm. And it is also too easy, with quite another kind of enthusiasm, to over-simplify issues - to focus too narrowly and criticize big schemes and dreams from which solutions can sometimes be developed. Zeal in proving a point replaces the commitment to really investigate. The consequences are unhealthy.
In his January 1987 SATURDAY NIGHT article on water, entitled "The Unknown Element", Peter Newman mentions the GRAND Canal scheme, and quotes Tom Kierans warning that Canada should negotiate water export while it still has the option. "Of course, the United States will not simply come and grab our water", Kierans explains. "They'll find another rationale - like saving us from the Russians." In sounding the alarm, Kierans is not alone. Newman ends his article with a quote from Roy Faibish, executive assistant to the minister of agriculture in the 1950's and now a television executive in England: "The strategic planners sitting in Peking, Moscow, Washington, Paris and London are looking at Canada....Either we start exporting our water or else!"
This is a powerful emotional appeal based on fear. It is the kind of appeal that bypasses proper evaluation and assessment, and stampedes the decision-making process. Although it is not uncommon, it is the worst kind of nonsense coming from otherwise intelligent people. Faibish could, perhaps, be excused. But it is strange coming from Kierans, who takes such exception to the "export label" being applied to his project. It is stranger still when GRANDCO purports to provide such a rational approach while discounting as emotional or biased the seriously considered critiques of others.
Water is not just another resource. It is the basis for all life. There is no substitute. It has a special place in the human psyche. Society, particularly Canadian society, quite rightly places water in a category quite different from anything else. Water is an all- encompassing symbol of value and life that transcends comprehension as market worth and even intrinsic worth. When threatened, that value naturally prompts great emotion.
To deride this trait in Canadians only cheapens the values that are a vital part of our identity. If this stretches conventional reason for some, then perhaps the strong public reaction to ideas like the GRAND Canal is more understandable in the contexxt of opinion polls that consistently place environmental issues, and water issues in particular, at the top of the list. This public concern is shared internationally, as the recent report of the World Commission on Environment and Development points out so well.
The dedication of waters from Canada to the United States on the scale envisaged by the GRAND Canal does raise serious continental questions. For example, such a scheme, if it were feasible, would create a permanent and direct American interest in one of our most basic resources. The waters of the Great Lakes are already shared, but that arrangement would be extended north and south. If the scheme actually does what its proponents claim, it would create a lifeline from the U.S. Midwest and Sothwest up through the Great Lakes into Canada's North. Americans wuld be dependent on that supply of water, water they will increasingly see as their own, their right, and vital to their continued well-being. But there are real possibilities for tension and serious misunderstandings that cannot be overlooked. The implications of establishing the GRAND Canal scheme with its origins in Canada and criss-crossing the nation's heart -land are at the core of the decision-making process. These decisions cannot be made lightly. They are not in the purview of engineers. Problems, where they do exist, can always be addressed in more than one way. The choices must not be artificially defined nor should they be restricted by short-term, vested interests. And fear whipped up to suit a cause should be understood to be the emotional blackmail that it is.
Water shortages exist now, and they may get worse in some regions, but it is important to remember that these shortages are defined by human use and abuse of water resources. Resource specialists and users worldwide see augmented supply as only one aspect of the solution to shortages. Using very expensive and massive water transfers is increasingly suspect. More often the real issue is seen to be in the laws, regulations, economies, and management techniques that drive our manipulation of water. Within that, demand management through efficiency of use, conservation, and realistic pricing offer immediate means to address shortages. If history can teach us anything, it will show that few water shortages are solved in the long run by throwing more water at the problem. More elegant solutions are worth pursuing as the avenue of first recourse.
Perhaps, in the end, the GRAND Canal scheme, or some variation of it, may be necessary, even desirable. If so, we must accept that it is fraught with issues that can be ignored only at our peril. Today, the scheme is more symbolic of the potentially fatal water mismanagement we are quietly perpetuating than it is of any solution that will provide a sustainable future. In all the talk and promotion, hopefully, we will be wise enough to see that sustainable future as the real issue to be addressed. If nothing else, Kierans could be just one more "agent provocateur" that compels us to do so.
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