The Canadian government has announced C$10bn (US$7.2bn) in federal financing for a major programme of hydropower, wind and transmission development centred on Labrador.
Prime Minister Mark Carney announced the agreement on 17 August alongside Québec Premier Christine Fréchette, Newfoundland and Labrador Premier Tony Wakeham, and the chief executives of Hydro-Québec and Newfoundland and Labrador Hydro.
The agreement covers upgrades and expansion of the Churchill Falls Generating Station and development of the Gull Island hydropower project, together with associated transmission infrastructure. It will also support co-investment opportunities with the Innu of Labrador in a new onshore wind project.
The Canadian government said the combined projects represent an investment of nearly C$70bn and will provide 14,000MW of renewable generation capacity, almost three times the existing generating capacity of Churchill Falls. The programme is expected to support 23,000 jobs during construction and contribute C$31bn to Canada’s GDP through the early 2040s.
“Canada is extending its unique advantage in clean, reliable, and affordable power. Because when we master energy, we master our destiny. Through cooperative federalism, we are unlocking our immense potential, building big, building sustainably, building in partnership, and building Canada strong for all,” Carney said.
Fréchette said: “In the current geopolitical context, it is vital for every nation to secure its energy future. I am very proud to announce today the conclusion of this new agreement, which is a priority for Québec, particularly for generations to come. Through this partnership, we are supporting the energy transition and enabling the growth of our economy through renewable energy, while ensuring our energy independence.”
The agreement follows negotiations over the future of Churchill Falls and the development of additional hydroelectric capacity in Labrador.
Newfoundland and Labrador Premier Tony Wakeham said the new arrangements would replace the 1969 Churchill Falls agreement and a memorandum of understanding reached in 2024.
“This is a win-win-win for Newfoundland and Labrador, the federal government, and Québec. I want to thank Prime Minister Carney and Premier Fréchette for their leadership throughout this process. We are finally replacing the notorious 1969 Churchill Falls deal and the 2024 MOU with a new deal that will guarantee us more power, more value, and more transmission. Newfoundlanders and Labradorians will finally be the primary beneficiary of our own resources, with complete control over whether we use our power to develop our economy or sell to outside markets. Today is not about what we can tear up, it’s about what we can build up. It is now time for us to roll up our sleeves and get to work to build a better and brighter future for all of us.”
Alongside the energy agreement, the federal government has referred the Labrador Trough Clean Power, Critical Minerals and Infrastructure Corridor to Canada’s Major Projects Office.
The office will coordinate federal financing and permitting and work with Indigenous communities on partnerships connected with development of the corridor.
Federal support will also be provided for several pre-development infrastructure projects through Natural Resources Canada’s First and Last Mile Fund.
These include studies for the Labrador West Transmission Expansion, which will assess grid infrastructure required to connect mining operations in western Labrador and support mine electrification.
Funding will also support planning and feasibility work for transport and energy infrastructure serving the proposed Kami iron ore project near Wabush, Newfoundland and Labrador, as well as pre-construction work on a transmission line connecting the Lac Knife graphite project to Hydro-Québec’s grid.
The government said the wider programme is intended to strengthen interprovincial electricity connections and export infrastructure while supporting increased renewable generation and industrial development.
