Power production is expected to rise under new Churchill Falls deal — and Labrador west needs it, mayor says

More details are emerging about a new Churchill Falls deal between N.L. and Quebec, including plans to boost energy production and how it will be split.

Earlier this week, sources not authorized to speak confirmed to CBC News a memorandum of understanding was close to being struck between the provinces, with a formal announcement possibly coming next week.

As first reported by Radio-Canada, according to sources close to the matter, each province will receive significantly more electricity than the previous MOU stipulated — with nearly 40 per cent more for Quebec and between 25 per cent and 60 per cent more for N.L.

Quebec will receive around 10,000 MW, while N.L. will receive at least 2,350 MW — possibly as much as 3,000 MW. Some details still remain to be worked out.

To increase electricity production by that amount, the two sides have agreed to develop an even more powerful hydroelectric facility at Gull Island and further increase the generating capacity of the turbines at the existing Churchill Falls plant.

The new agreement also includes wind power, which was not part of the 2024 MOU.

According to sources, this is where the main difference between the two agreements lies. The price at which the electricity will be sold is not expected to have changed significantly.

During last year’s election, N.L. Premier Tony Wakeham promised the Churchill Falls MOU would be put to a referendum if his party formed government.

When asked if a new deal should be put for a referendum, Lela Evans, Torngat Mountain MHA and Minister for Labrador Affairs, did not address the question, instead pointing out the PCs have been in government for the better part of a year.

“I think we’re starting to see now what a Tony Wakeham government is doing. It’s creating opportunities for the people in the province. It’s going to create a lot of jobs and it’s going to create a lot of financial wealth for our residents,” she told reporters Friday, before segueing back to the fertility funding announcement she was at Confederation Building to make.

Referendum question lingers as new Churchill Falls MOU expected next week

When Radio-Canada asked whether the deal could be released Monday, or potential reaction from the Innu Nation on a wind project on their land, Evans was tight-lipped, once again pivoting to speaking about the funding announcement.

Labrador City Mayor Jordan Brown said people in his region have been waiting for a new deal that will boost electricity production.

“It’s a make-or-break kind of situation. If no deal was had … within this year, we could have seen cancellations of projects and probably a mini-recession here in the region,” Brown told CBC Radio’s Labrador Morning.

In the revamped deal, first reported by allNewfoundlandLabrador and confirmed by a source to CBC, 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 needed power, Newfoundland and Labrador could sell it. 

“That’s a good, positive point,” said Brown, adding there are a lot of projects in Labrador that could make use of that power.

While the exact details of the MOU haven’t been released, Brown said he’d like to see assistance from the federal government with construction, including for a long-awaited third transmission line.

“We need that done yesterday.”

Gabe Gregory, a consultant and accountant who co-wrote an 82-page review of the 2024 version of the Churchill Falls MOU earlier this year, said market access could be a “significant” development.

“Certainly that sounds like a breakthrough — if it’s true and real,” he said.

Official details on the MOU aren’t currently known and he cautioned people to not get caught up in the announcement, as details can turn out to be different than initially reported.

“If there is a deal, I guess we’ll hear about it in the coming days. But even then, you know, I think there’ll be a lot of political spin on both sides,” said Gregory.

Gregory wants to see the new MOU go through an independent review, like the 2024 MOU was.

“I think the government should also live up to its commitment for a referendum. Because at the end of the day, this is the people’s resource. We own this and we all deserve the right to have our say in regard to the future of that development,” he said.

‘A big change’: New Churchill Falls deal would let N.L. sell power through Quebec’s network to other markets

Quebec-Labrador border is becoming political fodder

Friends of Renewable Churchill Energy chair Ben Oates, a coalition that mostly supported the previous MOU, said the details of the new MOU are similar to the previous one.

“The bones are the same. We open up the old 1969 contracts and get fair value for our power, finally,” he said.

“We’re all pleased to see improvements. These improvements should have been worked out towards final negotiations. We didn’t need to stop the music and basically cool our heels for a bit.”

Oates added an upcoming election in Quebec — where separatist Parti Québécois is expected to win — puts a deal at risk.

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