Newfoundland residents seek answers, assurance as Quebec energy deal heads for debate

ST. JOHN’S, N.L. — About 50 people gathered in a St. John’s, N.L., gymnasium on a recent rainy night to seek answers about a massive energy deal with Hydro-Québec trumpeted by the Newfoundland and Labrador government as a new chapter in the province’s history.

One by one, a stream of attendees at the provincial NDP’s town hall on Thursday stepped up to a microphone to say they were uncertain about whether they could trust that the tentative agreement was the best deal for Newfoundland and Labrador and that it wouldn’t repeat mistakes of the past.

The legislature is set to open Monday for a debate about the arrangement, little more than three weeks after it was announced. Some said that didn’t leave enough time for opposition politicians — or the public — to fully understand the deal, and prepare.

“This is so big that we have to take our time and do it right,” said George Power, drawing applause from the crowd.

“I say to Premier Andrew Furey, shame on you for trying to push this through,” he added. “And if we let this happen, shame on us.”

Furey unveiled the agreement on Dec. 12 at a splashy press conference in St. John’s, N.L. Quebec Premier François Legault sat next to him, grinning in front of a crowd of applauding Liberals from across Newfoundland and Labrador.

The draft deal calls for Hydro-Québec to pay more for the energy it has long purchased for basement-bottom prices from the Churchill Falls plant in Labrador, thanks to a contract signed in 1969. It also lays out plans for Hydro-Québec and Newfoundland and Labrador Hydro to develop more hydroelectric projects in Labrador, promising thousands of jobs and billions in revenue.

Under the new agreement, Hydro-Québec will pay an “effective price” of about 5.9 cents per kilowatt hour for Churchill Falls power — about 30 times more than the 0.2 cents it has paid, Newfoundland and Labrador Hydro officials said. The effective price captures the amounts over time in today’s dollars, officials said.

That will result in an increase of about $17 billion to the provincial treasury between now and 2041, averaging at about $1 billion a year, officials said. By 2056, the province will be getting about $4 billion a year. That money includes dividends from the new rates, as well as water taxes and royalties, Hydro officials said.

If the contract is finalized as hoped in 2026, the new rates will be in place whether or not the provinces move ahead with the additional developments, according to officials.

The memorandum of understanding was released to the public, but it hasn’t been easy to understand. Some details are sparse, prompting members of the public to attempt to fill them in. The provincial Crown energy corporations also released different figures about the project: Newfoundland and Labrador Hydro says its information reflects what Hydro-Québec will pay for Churchill Falls power, while Hydro-Québec’s numbers show what its customers will pay.

Newfoundland and Labrador Hydro is offering a series of public webinars about the deal, but not until the week after the legislature debate.

In the meantime, the Newfoundland and Labrador government launched an advertising campaign promoting the agreement, featuring workers in hard hats and slogans such as, “Our jobs. Our money. Our power.”

“We are being subjected to a sophisticated (public relations) snowjob,” said Byron Button, a town hall attendee on Thursday night. He urged NDP Leader Jim Dinn to work with the Opposition Progressive Conservatives to ask all necessary questions when the debate opens on Monday.

“It’s going to take a lot of preparation, sir,” Button said. “And you don’t have much time.”

During a virtual town hall on Friday night hosted by the Progressive Conservatives, Kristina Ennis said she felt the government was trying to prevent the public from understanding the agreement.

“They’re just saying, ‘Trust us,'” Ennis wrote in a comment read out by the moderator.

Both Dinn and Tony Wakeham, the leader of the Progressive Conservatives, have called for an independent review of the agreement. That call was echoed by attendees at both their town halls. People pointed to the disastrous Muskrat Falls hydroelectric project, which inched over the finish line in 2023, after years of delay and cost overruns. The province is still struggling to pay for it.

Officials said several independent firms including J.P. Morgan advised during the negotiations of the new Hydro-Québec contract, and representatives are scheduled to to be part of the debate beginning Monday.

But Dinn said he’d prefer to hear from an expert who had nothing to do with the process.

“If this is as good as everyone says it is, then fine,” he told the crowd Thursday. “I truly hope this is a turning point (for the province). But I truly need to have the perspective an objective set of eyes can bring to it.”

This report by The Canadian Press was first published Jan. 5, 2025.

Sarah Smellie, The Canadian Press