Canadian Design and Construction Report staff writer
Quebec and Newfoundland and Labrador have reached a new agreement to expand the Churchill Falls Generating Station and develop the massive Gull Island hydroelectric project, backed by up to $10 billion in federal financing.
Prime Minister Mark Carney, Quebec Premier Christine Fréchette and Newfoundland and Labrador Premier Tony Wakeham announced the agreement Tuesday, saying it will replace the long-standing 1969 Churchill Falls contract and a 2024 memorandum of understanding between the provinces.
The agreement calls for upgrades and an expansion of Churchill Falls, development of Gull Island, new transmission infrastructure and co-investment opportunities with the Innu of Labrador in a major onshore wind project.
Together, the projects are expected to produce about 14,000 megawatts of clean electricity, nearly tripling the current generating capacity of Churchill Falls.
The federal government will provide $10 billion in financing for the projects, which Ottawa said will help attract additional private and public investment.
“This is a win-win-win for Newfoundland and Labrador, the federal government, and Québec,” Wakeham said in a statement.
“We are finally replacing the notorious 1969 Churchill Falls deal and the 2024 MOU with a new deal that will guarantee us more power, more value, and more transmission.”
Wakeham said the agreement gives Newfoundland and Labrador greater control over how its electricity resources are used, including whether power is used to support economic development in the province or sold to outside markets.
The Churchill Falls project has been at the centre of a decades-long dispute between Quebec and Newfoundland and Labrador. The existing 1969 contract allows Hydro-Québec to purchase most of the electricity from Churchill Falls at a rate that Newfoundland and Labrador has long argued is far below its market value.
The new agreement also comes as the two provinces look to expand electricity generation to support industrial development and growing demand for clean power.
Ottawa said the projects could generate enough electricity to power the homes of Toronto, Montreal and Vancouver combined.
The federal government is also moving to advance development of the Labrador Trough, a major mining region spanning Labrador and Quebec that contains significant deposits of high-purity iron ore and other critical minerals.
The Labrador Trough Clean Power, Critical Minerals and Infrastructure Corridor has been referred to the federal Major Projects Office, which will help coordinate federal financing and permitting and work with Indigenous communities on partnerships.
Ottawa is also supporting several infrastructure projects in the region through Natural Resources Canada’s First and Last Mile Fund.
They include a study of expanded transmission infrastructure in western Labrador to support electrification of critical-minerals mining operations; planning and feasibility work for transportation and energy infrastructure for the Kami iron ore project near Wabush; pre-construction work on a transmission line and road serving the Lac Knife graphite project in Quebec; and an expansion of critical-minerals handling and rail infrastructure at SFP Pointe-Noire.
The agreement represents a major expansion of the region’s electricity infrastructure, but the projects will still require significant construction, permitting and investment before the additional generating capacity comes online.
Carney said the deal will strengthen Canada’s energy security and expand its supply of reliable, renewable electricity.
“Canada is extending its unique advantage in clean, reliable, and affordable power,” Carney said. “When we master energy, we master our destiny.”
