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Churchill Falls: Quebec vs Newfoundland

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The Churchill Falls (Labrador) Corporation (CFLCo) has two major shareholders: Hydro-Québec (34 per cent) and Nalcor (66 per cent).

CFLCo owns and operates one of the most powerful hydroelectric plants in the world: Churchill Falls, with 5,250 megawatts.

In 1969, CFLCo and Hydro-Québec signed a contract, the power contract, which will end in 2041.

The agreement committed CFLCo to keep running the Churchill Falls power plant and committed Hydro-Québec to buy most of the plant’s output at one-quarter of a cent per kilowatt hour until August 2016 and at 0.20 cents for the last 25 years of the contract.

Incomes from Hydro-Québec are so low that Newfoundlanders (through Nalcor) don’t receive any benefit from this giant power plant.

Meanwhile, Hydro-Québec makes more than $2 billion net profit per year by exporting Churchill Falls energy to Ontario, New Brunswick, Vermont, Maine, New Hampshire, Massachusetts, Connecticut, New Jersey and New-York.

Six year ago, in 2010, CFLCo made a request to Quebec Superior Court to obtain from Hydro-Québec a better price per kilowatt hour — a fair price.

In July 2014, Quebec Superior Court dismissed the CFLCo request. Then, CFLCo made an appeal from judgment to the Quebec Court of Appeal (File No. 500-09-024690-141).

The appeal will be heard in Montreal on April 25-26.

The question is, will the Quebec Court of Appeal be able to tell Hydro-Québec that enough is enough?

 

Lucien Beauregard, P.Eng

Sainte Julie, Que.

* This letter has been corrected for a numerical error.

 

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