What the Churchill Falls deal means for Quebec – and the provincial election

Prime Minister Mark Carney was in St. John’s on Monday to announce a new agreement on Churchill Falls and other electricity projects in Labrador, alongside N.L. Premier Tony Wakeham and Quebec Premier Christine Fréchette. 

It is being touted as the largest clean energy investment in North American history, valued at nearly $70 billion, with Ottawa chipping in $10 billion in federal financing. 

That money would go towards upgrading and expanding the Churchill Falls generating station, developing the Gull Island hydroelectric project, building transmission lines and implementing a 2,000 megawatts onshore wind energy project in Labrador.

It will increase the current generating capacity of Churchill Falls, with enough power to light, heat and cool all the homes in Toronto, Montreal and Vancouver combined. 

Here’s a closer look at what the could mean for Quebec, Fréchette and the looming provincial election campaign.

Not quite.

The agreed-upon framework announced on Monday will hold until March 2027.

A definitive agreement still needs to be signed and the parties involved hope that happens by the end of the year.

The provincial election is scheduled for Oct. 5. That means there could be a change of government before the deal is officially signed.

Opposition leaders, Innu grand chief await the fine print on new Churchill Falls deal

Under the deal, the province would have access to over 10,000 megawatts, representing more than a quarter of Hydro-Québec’s total current output. 

In comparison, the 2024 Churchill Falls Memorandum of Understanding, which was rejected by Wakeham shortly after he became premier, provided for a total potential of 7,200 megawatts.

The electricity produced at Churchill Falls would be sold to Quebec at an average price of 6.2 cents per kilowatt-hour, which Fréchette said could lead to savings of $200 billion over the course of the deal.

N.L., Quebec announce new Churchill Falls agreement worth billions — with help from Ottawa

Yvan Cliche, a fellow specialist in the energy sector at the Université de Montréal’s centre for international studies, called it a “historic landmark agreement for Quebec.”

Cliche believes the deal will benefit not only the energy sector but consumers in Quebec, by allowing Hydro-Québec to keep its rates as low as possible. 

For Fréchette, the agreement represents a win ahead of the start of the campaign — and a chance to demonstrate her economic credentials.

On Monday, the premier and leader of Coalition Avenir Québec (CAQ) described the deal as a partnership that ensures Quebec’s energy security for the next 50 years and create thousands of jobs.

If her party stays in power come October — a third straight CAQ election victory but a first under Fréchette — she will follow through to make sure the Churchill Falls deal is made official.

“Because it brings to Quebec thousands of new megawatts and we need those megawatts for residents, for businesses, for every region in Quebec,” Fréchette said.

Carney said the time was right for the deal — even if it is so close to the start of the election period. He said negotiations began four months ago, soon after Frechette took over as premier.

Others were more critical — even before the deal was announced.

The leaders of the Innu nations Matimekush-Lac John and Uashat mak Mani-utenam, both located in Quebec’s Côte-Nord region, issued a joint statement emphasizing that they had not been consulted.

“Our participation and consent are mandatory for any agreement to the Churchill Falls megaproject,” reads the statement.

They also highlighted that the initial project was carried out on their traditional land — the Nitassinan — and that their case for reparations is still before Quebec courts.

What the new Churchill Falls deal means for Quebecers — and their Hydro bill

The campaign is expected to launch sometime next week.

Days of speculation leading into Monday put a spotlight on Fréchette, who took over as premier in April, and made her a target for criticism from opposition parties.

In a social media post last week, Parti Québécois (PQ) Leader Paul St-Pierre Plamondon said Fréchette doesn’t have the legitimacy to make such a deal right before the campaign that will bind Quebec for 50 years and there was no need to make a deal now.

On Monday, the two exchanged words, with Fréchette stating during the news conference that St-Pierre Plamondon would tear up the agreement if elected.

On X, the PQ leader shot back, saying that was “simply a falsehood” and accused her of rushing a deal for electoral reasons.

Éric Duhaime, leader of the Quebec Conservatives, made similar accusations, as did Québec Solidaire (QS).

In a written statement, Duhaime said Fréchette is trying to distract Quebecers from “eight long years of disastrous management of our public finances” under the CAQ.

He said his party supports increasing energy production in Quebec and would look to maximize the province’s natural resources, including hydroelectricity, natural gas “and, possibly, nuclear power.”

Ruba Ghazal, the parliamentary leader for QS, said a deal of this magnitude should serve the interests of Quebecers for the next half century, “not the electoral interests of the CAQ.”

Charles Milliard, the leader of the Quebec Liberal Party, said it wouldn’t make sense to start from scratch and saluted the work accomplished by Hydro-Québec.

He said, however, the agreement would have short-term impacts on public finances and on the rates for Quebecers and that if elected, his government would “fully analyze it before ratifying it.”

Fréchette had a message to opposition parties Monday: What deal are you proposing?

“Where will they find the 10,000 megawatts we are bringing to Quebec with that agreement? At what cost will they bring new megawatts?  Where will they take them? How will they create 20,000 jobs?” she asked.

“Because this is what is in that agreement. It’s 23,000 jobs for Newfoundland and Quebec.”