François Legault will be in Saint John tomorrow and Friday to begin negotiations to extend the Churchill Falls hydropower contract.
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The contract with the Newfoundland Labrador ends in 2041. The province of Maritimes has been complaining about this financially unfavorable agreement for years.
For the first time, François Legault said he was willing to offer Newfoundland financial compensation before the end of this agreement.
“Are there any places to stay? It has to be a win-win situation. It depends on the price they offer us from 2041. If they offer us a very cheap rate from 2041.. are we willing to pay amounts before 2041? It will be part of what will be asked,” he said.
“Probably Andrew Fury (…) will make all sorts of requests. We’ll listen to him to see what’s his priority. The idea is to try to renegotiate the treaty after 2041 as soon as possible.
difficult negotiations
François Legault wants a “win-win” deal with his counterpart Andrew Furey, warning that the negotiations will be long and “difficult”.
“The negotiations will not be easy. We know that Quebec has a very advantageous contract until 2041,” he said.
Because of this old agreement, signed in 1969, Quebec buys hydroelectric power from Churchill Falls at a discount. It pays 0.25 cents per kilowatt hour without the option of indexing. The courts have also ruled in Quebec’s favour, after Newfoundland’s lengthy appeal to force the accord to be reinstated. In comparison, Hydro-Québec will sell its power in New York at 9.75 cents per kW/hr before indexing.
Mr. Legault believes Quebec still has the capacity to export its hydropower.
“We have various projects in Quebec, we are working with Hydro-Quebec to see what capacity we can add at Hydro-Quebec. But we also need to know what’s coming from the side of Churchill Falls and maybe even Gull Island.
New dams
The Secretary of Energy added in English that Newfoundland needs Quebec and that Quebec needs Newfoundland.
However, the completion of these negotiations for Churchill Falls could determine the future of hydroelectric power development in Quebec.
“The year 2041 may seem far away,” said the prime minister. “But building a dam has always taken between 12 and 15 years when you include discussions and negotiations with indigenous communities. Do the math, we are approaching 15 years,” said the Prime Minister.
Unceded Territory
PQ Pascal Bérubé said it was “humiliating to negotiate on a territory that belongs to us”.
“Here’s unceded territory in Quebec, there, as far as I’m concerned,” he ranted.
“Unless I am mistaken, Quebec government diplomatic positions always refuse to recognize the territory of Labrador as ceded to Newfoundland.”
According to him, Quebec should “make an offer directly” to manage the hydroelectric resources in Newfoundland.
Beware
The provisional leader of the official opposition believes it is possible to sign a mutually satisfactory agreement. However, he doubts François Legault’s negotiating skills.
“You have to be careful when François Legault takes the pilgrim’s stick and then says: I’ll negotiate that and then I’ll come back. We’ve seen what there’s been in health transfers, so you always have to put François Legault’s ambitions into perspective,” he said.
For his part, the Speaker of Quebec Solidaire points out that Quebec desperately needs Churchill Falls to complete its energy transition.
“To accomplish the energy transition, we need more electricity in Quebec, and Churchill Falls is an important source. So it would be a setback to lose that power supply. Therefore, we expect an agreement that is satisfactory for Quebecers,” said Gabriel Nadeau-Dubois.
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