For Newfoundland, the 1969 agreement on the hydroelectric development of Churchill Falls has always been a kind of colonialism in which Quebec had the bad role.
Published at 6:00 a.m.
Newfoundland had the impression – justified, moreover – of selling one of its riches at a low price to Quebec, which was going to reap all the profits. A project which, originally, was seen as a way out of poverty, but which had become the symbol of its misery.
The energy from Churchill Falls was sold to Quebec for 0.2 cents per kilowatt hour and Hydro-Québec was then able to resell it in the United States at least 30 times more expensive.
For years. It was resentment towards this fundamentally unfair agreement that blocked any negotiations between Quebec and Newfoundland (which became Newfoundland and Labrador in 2001).
Several attempts by Newfoundland to have the agreement canceled have failed in court. The Supreme Court of Canada has ruled: we cannot cancel a contract – signed legally and with full knowledge of the facts by both parties – because the price of electricity has increased.
Why, then, did Quebec say it was ready to agree to tear up an agreement that was so beneficial to it, 17 years before its deadline? Quite simply, because it was in his interest.
Churchill Falls represents 15% of the energy consumed in Quebec. The equivalent of twice the production of the Manic-5 and Manic-5-PA power plants. It was therefore essential to secure this supply, even at the cost of $9 billion more by the end of the contract in 2041.
And even at this price, Labrador energy remains a bargain, compared to replacement costs.
As a bonus, Newfoundland and Labrador reserves the driver’s seat for Hydro-Québec for the development of other power stations in Labrador, in particular the Gull Island project, a total of almost 4,000 additional MW.
But then, if the agreement is so good for Quebec – and it is! –, why did Newfoundland and Labrador sign? Has the province not been fooled by Quebec once again? In Newfoundland, there are already voices saying that the new agreement is just the bad 1969 contract “with an indexation clause”.
But one thing never changes in this matter, and that is geography. Newfoundland and Labrador still has only one neighbor to sell its electricity to and that is Quebec.
For the record, let us recall that former Prime Minister Joey Smallwood tried, in his time, to create an “Anglo-Saxon Route”, with submarine cables and a passage through the maritime provinces. But the technology was not ready and the costs were prohibitive.
Still, all this contributed to an old enmity establishing itself between the two provinces, especially because of the 1969 contract, which was denounced by generations of Newfoundland politicians (especially when they were in the opposition!) as being too favorable to Quebec.
During the decade 2000-2010, the prime minister at the time, Danny Williams, did everything to fuel resentment against Quebec. But it was a lot to forget the cost overruns of the Muskrat Falls project, a mega-power plant project on the Churchill River whose construction costs have doubled and which had become a real political nightmare for his government.
This distrust of Quebec remains. The legendary radio station VOCM in Saint John’s conducted a survey among its listeners to find out if the agreement with Quebec allowed them to forget the humiliation of the 1969 contract: 32% of listeners said yes, 30% no and 37 % responded “we’ll see…” Enthusiasm is therefore moderate!
Newfoundland politicians also criticized Prime Minister Andrew Furey for not taking advantage of the opportunity to have the Quebec-Newfoundland border recognized as decided by the Privy Council in London in 1927. Ironically , in Quebec, the leader of the Parti Québécois Paul St-Pierre Plamondon condemned François Legault for not having done the opposite…
But it must be said that Quebec was lucky to find an interlocutor like Prime Minister Furey, who is not yet 50 years old, and who comes from this new generation of Newfoundlanders who do not believe in dwelling on things forever. old grudges.
Obviously, Mr. Furey will be able to count, in the short term, on the additional $9 billion that Quebec will pay him by the end of the contract in 2041. Over the next 60 years, Terre-Terre will receive $200 billion. New and Labrador. No wonder Mr. Furey said that now everything could change for his province.
For Quebec, it may be a high price, but it was much riskier not to secure this energy supply.
Politically, for the two prime ministers, this agreement is advantageous. And when we know the symbolic importance of electricity and Hydro-Québec for Quebecers, we can even say that it was François Legault’s best day since he became Prime Minister.
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