Churchill Falls Agreement Is Coming, Says Frchette, While Wakeham Remains Cautious

Quebec Premier Christine Fréchette is expressing optimism her province and Newfoundland and Labrador will reach an agreement “in the coming weeks” on the thorny issue of expanding the hydroelectric potential of the Churchill River in Labrador.Fréchette made the comments on Tuesday after her first face-to-face meeting with Newfoundland and Labrador Premier Tony Wakeham.“We said earlier that we were confident we could wrap this up in the coming weeks,” she said.Wakeham, who has been delaying the signing of a new agreement since his election in 2025, did not get into specifics about when a deal could be reached.“Things are moving forward,” Wakeham said after the meeting, during a separate press briefing.The meeting took place on the sidelines of the summer gathering of the Council of the Federation, the forum of provincial premiers held this year in Charlottetown.“I do believe that there’s a willingness on both parties to come and try to reach an agreement and hopefully that can happen, but right now both teams are still negotiating, and we’re making progress,” Wakeham said.If the two sides reach a deal, it could still face another obstacle in Quebec, which is headed into a general election that could usher in a new government with different demands or priorities for an energy deal between the provinces.“Right now, my focus is on the province of Newfoundland and Labrador and the benefits that we can get from the use of our hydroelectricity opportunities,” Wakeham said when asked about the looming election.Fréchette said she would speak with Wakeham again in the coming days.Quebec is counting on the deal to secure the megawatts it needs to meet growing demand through 2075, but Newfoundland and Labrador wants to renegotiate the memorandum of understanding—originally signed in December 2024—to secure better terms.Fréchette suggested last December that Quebec had other plans to secure its power supply in the event that negotiations with Newfoundland and Labrador failed.Originally, the ambitious memorandum of understanding, signed in December 2024 by her predecessor, François Legault, and then-Newfoundland and Labrador Premier Andrew Furey, seemed destined to result in a final agreement.But Furey left politics in the spring of 2025, and Wakeham’s Progressive Conservative government, which was subsequently elected, established a committee that concluded in May that the draft deal was not in Newfoundland and Labrador’s best interests.The tentative agreement was intended to resolve a long-standing dispute between the provinces by replacing the current 1969—2041 agreement governing the operation of the joint Churchill Falls power plant, which Newfoundland and Labrador considers unfair.Furthermore, Hydro-Québec was set to make massive investments to increase production along the Churchill River through partnership projects estimated at over $30 billion.Currently, Hydro-Québec purchases electricity from the plant at 0.2 cents per kilowatt hour to resell it at a higher price. The draft agreement stipulates that Hydro-Québec would gradually increase the rate until 2075, reaching an effective average price of 5.9 cents per kW/h—30 times the current price.The tentative deal proposed a 550-megawatt upgrade to the Churchill Falls facility, and a second 1,100-megawatt power house near the existing plant. It also proposed a new 2,250-megawatt power plant downstream at Gull Island.The existing Churchill Falls plant has a capacity of 5,428 MW and supplies about 15 percent of Hydro-Québec’s electricity.If the agreement goes through, Quebec would have access to 7,200 megawatts to meet its needs, particularly to decarbonize its economy in accordance with international agreements on reducing greenhouse gas emissions.Before being defeated in the 2025 election, the Newfoundland and Labrador Liberals claimed that the proposal, if finalized as planned in April 2026, would bring the province more than $225 billion over the next 50 years. However, the committee appointed by Newfoundland and Labrador’s Progressive Conservative government to review the deal said the Liberals had overstated its value.