Churchill Falls: NL’s Consumer Advocate will evaluate the agreement

The Liberal government of Newfoundland and Labrador, with the support of elected New Democrats and independents, announces that the consumer advocate will be responsible for evaluating the agreement in principle concerning the Churchill Falls hydroelectric power station.

Dennis Browne will chair an independent committee, composed of three members in total, which will also supervise the negotiation of final agreements with Hydro-Québec on the energy future of the river Churchillin Labrador, and will make public quarterly reports.

The committee will advise cabinet and provide reports to the public and the House of Assembly, respecting commercial sensitivities and ensuring not to compromise negotiations between provincesexplained the Minister of Energy on Thursday, Andrew Parsons.

Since the start of the special debate on the memorandum of understanding on Monday, opposition MPs have insisted that a highly technical document must be the subject of an independent analysis.

Relief among several elected officials

If the Liberal government promises that the agreement in principle, spanning 50 years, will increase the price of electricity sold to Hydro-Québec, pave the way for the construction of new hydroelectric power stations and allow the provincial government to pocketing hundreds of billions of dollars, opposition elected officials want to ensure that their province benefits as much as possible from Labrador’s natural resources.

They recall that the current contract of Churchill Fallssigned in 1969, has rhymed with resentment in Newfoundland and Labrador for decades. It sets the price of electricity at 0.2 cents per kilowatt hour until 2041. Hydro-Québec sold its electricity exports at an average price 51 times higher in 2023, according to its latest annual report. .

In light of the announcement of the establishment of a committee on Thursday, the leader of the NDP, Jim Dinnas well as independents, Paul Lane et Eddie Joycesay they will vote for the memorandum of understanding at the end of the debate on Thursday evening.

I want an agreement to be reached, but as we have heard several times this week, we have to do things right. What we announce makes me much more comfortableaffirms Paul Lanereferring to the latest hydroelectric project undertaken by Newfoundland and Labrador.

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He recalls that the central Muskrat Falls almost bankrupted his province. A commission of inquiry demonstrated that executives directing the construction of the dam had hidden relevant information about the project’s risks from the government.

The consumer advocate chooses his team, he is given the resources he needs to carry out an adequate evaluationadds Jim Dinn.

The Liberals, the majority in the House of Assembly, had so far rejected the opposition’s claims, recalling that Hydro Newfoundland and Labrador negotiators and the provincial government had hired several consulting firms during the negotiations.

For his part, the Progressive Conservative leader, Tony Wakehamwho called for the special debate to be suspended while an independent assessment of the memorandum of understanding is conducted, did not participate in the announcement.

Instead, he wants the Public Services Board to look at the memorandum of understanding and believes that the consumer advocate, a longtime Liberal supporter who called the agreement in principle phenomenal last month, has already taken a position on the agreement.

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He has already expressed his opinion on the agreementsupports Tony Wakeham.

The Prime Minister, Andrew Fureyaffirms that the consumer defender has not participated in the activities of the Liberal Party since his appointment to this position in 2016. Andrew Parsons also pointed out that it was independent MPs who first suggested that Dennis Browne chairs the committee.

I said the same thing as [le défenseur du consommateur] at the time of the announcementadded Jim Dinn. But since then, I have asked myself many questions. Dennis Browne undoubtedly does the same thing.

Dennis Browne declined an interview request.

MEPs will vote on the agreement Thursday evening

Newfoundland and Labrador elected officials must vote Thursday evening on the agreement in principle. The 40 MPs will have to decide whether Hydro NL. can continue to negotiate a final electricity supply agreement with Quebec.

During four days of debate, elected officials were able to ask questions to the agreement negotiators and to the financial and electricity market experts who advised them.

Hydro NL executives explained that under the agreement in principle, announced with great fanfare last month, Hydro-Québec agrees to pay approximately 30 times more for electricity from the existing power station. Newfoundland and Labrador, for its part, allows the construction of the dam Gull Island and a new power plant Churchill Falls. The existing power plant Churchill Falls will be developed and new transmission lines will be built.

This is the best possible deal for Newfoundland and Labrador. It will stand up to scrutinyargued the CEO of Hydro NL, Jennifer WilliamsMonday.

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Representatives of two consulting firms that advised Newfoundland and Labrador negotiators during the talks also testified that the agreement will allow the province to obtain a fair price for the river’s energy Churchill.

I am convinced that this is a very good financial agreement for the province said David Rawlingsinvestment banking executive JP MorganWednesday evening.

The general director at Power Advisory, Jason Chee-Aloywho has been studying the electricity market for 25 years and has already worked for several of Canada’s largest energy companies, indicated that the agreement in principle represents a very good agreement which avoids the errors of the current contract of Churchill Falls.

He specified, for example, that the agreement in principle stipulates that the price will not be fixed, as it is in the current contract. Hydro Newfoundland and Labrador has learned its lessonhe indicated.

According to Hydro Newfoundland and Labrador, the price of electricity from the existing plant will gradually rise from 1.63 cents per kilowatt hour in 2025 to 7.84 cents per kilowatt hour in 2041. By 2075, it will have reached 37 cents.

The Liberals commit to holding a second debate in the House of Assembly when the final agreements regarding Churchill Falls and the construction of new power stations in Labrador are finalized.