Ottawa is calling it the largest clean energy investment in North American history.
Prime Minister Mark Carney was in St. John’s Monday to announce a new agreement on Churchill Falls and other electricity projects in Labrador, alongside N.L. Premier Tony Wakeham and Quebec Premier Christine Fréchette.
“We are finally turning the page on one of the darkest chapters in our past, and replacing both the notorious 1969 Churchill Falls agreement and the 2024 [memorandum of understanding] with a better deal for all of us,” said Wakeham.
The trio of leaders gathered on Pier 17, amid a picturesque ocean background, as details of the new deal were touted.
Ottawa will provide $10 billion in financing to upgrade and expand the Churchill Falls generating station, develop the Gull Island hydroelectric project, build transmission lines and implement a 2,000 MW onshore wind energy project in Labrador — with the exact location and other details for that wind project under consideration by Newfoundland and Labrador Hydro.
According to the federal government, altogether these projects represent the largest clean energy investment in North American history — valued at nearly $70 billion — and will nearly triple the current generating capacity of Churchill Falls, with enough power to light, heat and cool all the homes in Toronto, Montreal and Vancouver combined.
“Just put this in context. Tripling the current generation capacity of Churchill Falls to that 14,000 megawatts of renewable power — that’s more than the entire generating capacity of B.C. Hydro. It’s more than double the output of Bruce Power, the largest nuclear plant on this continent,” Carney said.
The projects will create 23,000 jobs, according to both levels of government.
The deal will give Quebec a much-needed source of secure power, while N.L. looks to make additional revenue off of natural resources as it faces crippling debt.
It also seeks to help Newfoundlanders and Labradorians save money on their electricity bills.
A new 15 per cent rebate will be given to all N.L. ratepayers on their first 2,000 kWh of electricity used per month. Wakeham said this will save households an average of $351 per year.
Wakeham calls agreement a ‘win-win-win’
The new tentative agreement between Newfoundland and Labrador Hydro and Hydro-Quebec has some updated figures compared to the 2024 MOU signed in 2024 by N.L’s previous Liberal government.
N.L. Hydro says the deal will increase the value for N.L. from the $36 billion estimated in the 2024 MOU — to $49 billion in net present value.
This new agreement is in effect until March 31, 2027, unless both parties agree to change the date, or unless they sign definitive agreements beforehand.
The upcoming Quebec election could complicate that if another party takes power, but for now, Wakeham is calling it a “win-win-win.”
He said this guarantees N.L. more power, more value and more transmission — a phrase he has said many times before when he was asked what he wanted to get out of N.L.’s negotiations with Quebec on Churchill River hydroelectric projects.
Hot off the heels of a new Churchill Falls hydroelectric agreement between Newfoundland and Quebec, Prime Minister Mark Carney said Ottawa will chip in $10 billion in federal financing to upgrade and expand the project. The funds will be used to upgrade and expand the generating station, build transmission lines, create offshore wind turbines and develop the Gull Island hydroelectric project.
There’s a guaranteed transmission access of 985 megawatts through Quebec. This means Newfoundland and Labrador can sell up to that amount of Churchill River electricity by sending it through Quebec, using Hydro-Quebec’s transmission network, and on to other markets.
For example, if Massachusetts or New York needed power, Newfoundland and Labrador could sell it.
The previous Churchill Falls MOU had no guarantees of transmission access and it would be Quebec that would have first access to energy set aside for N.L. but that was not being used within the province.
“Newfoundlanders and Labradorians will finally be the primary beneficiary of our own resources, with complete control over whether we use our power to develop our economy or sell to outside markets,” Wakeham said.
“Today is not about what we can tear up, it’s about what we can build up,” he said, seeming to allude to the 2024 announcement with Quebec when former N.L. premier Andrew Furey ripped up the 1969 Churchill Falls agreement.
Within N.L, the original deal has long been criticized as lopsided in Quebec’s favour.
On the campaign trail last fall, Wakeham vowed to put the new deal to a referendum. He said on Monday that in place of that, he will convene a special meeting of the House of Assembly on Sept. 14.
Wakeham told reporters that deciding to not have a referendum was a difficult decision to make and he admitted people will likely be “disappointed” that he is not going to move forward with his promise, but said, “the time is now, the urgency is there.”
More power, money for N.L.
While the previous MOU included a promise to expand Churchill Falls by adding a new powerhouse next to the existing generating facility, the new deal isn’t definitive.
Ottawa says it can offer funding to do so, but the new agreement between N.L. and Quebec says they agree to only study that “potential” expansion.
The new deal does, however, include upgrades to the current facility, increasing its capacity by 23.5 per cent, or 1,275 MW. The MOU signed in 2024 pegged those upgrades at 550 MW.
In total, N.L. Hydro says Newfoundland and Labrador will get about 760 MW more power with this agreement — 2,350 MW versus 1,990 MW agreed in the 2024 MOU. If the wind project is completed, that amount could increase up to 2,750 MW.
Hydro-Quebec gets access to up to 6,915 MW, or up to 8,515 MW if the wind project is completed.
N.L. Hydro says Hydro-Quebec will pay 1.8 cents per kilowatt hour next year — up from the current 0.2 cents — and that price will go up 14 per cent per year, reaching 11.5 cents in 2041.
Ottawa will now also be providing a loan guarantee for Gull Island construction costs, which Carney said will be part of a new Atlantic energy strategy under the Major Projects Office.
The agreement also says they will study the potential development of a new wind project generating facility, but there are few other details.
In his speech, Carney said the federal government would be investing alongside the Innu Nation into a wind project in Labrador, and will help finance new transmission lines.
“Because yes, we love these windswept lands,” said Carney, alluding to N.L.’s provincial anthem.
Expansion of Labrador mining projects
Ottawa says the extra power will help to grow Labrador’s mining industry, and it is also providing money to bolster that development.
Natural Resources Canada says Ottawa will provide more than $2.3 million to complete an engineering and design study for transmission lines that would bring more power to Labrador west.
There is also $439,844 for preconstruction and feasibility planning for the Kami iron ore project southwest of Wabush.
Quebec election uncertainty
With a Quebec election expected to be called by the end of the month, reporters questioned Fréchette on whether this deal will last in the case of new leadership.
Currently, the Parti Québécois is leading in opinion polls, and has spoken out against the Churchill Falls agreement.
Fréchette said that this new agreement secures more megawatts and jobs for Quebec, saying that it is in the interest of Quebecers.
“I see the Parti-Quebecois is interested in tearing up this agreement. They don’t want to implement it. OK, so what do they offer to Quebecers if it’s not this agreement? Where will they find the 10,000 megawatts we are bringing to Quebec with that agreement?” she said.
“This is what’s in that agreement. It’s 23,000 jobs for both Newfoundland and Quebec,” she said.
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