Supreme Court to review Hydro-Québec's Churchill Falls energy deal

Supreme Court to review Hydro-Québec's Churchill Falls energy deal
Supreme Court to review Hydro-Québec's Churchill Falls energy deal

Published on: April 20, 2017 | Last Updated: April 20, 2017 10:59 AM EDT

The inside of the powerhouse at the Churchill Falls hydro electric station in Churchill Falls, N.L. is shown on Nov. 20, 2009.

The inside of the powerhouse at the Churchill Falls hydro electric station in Churchill Falls, N.L. is shown on Nov. 20, 2009. Kevin Bissett / THE CANADIAN PRESS

The Supreme Court of Canada says it will review the 1969 Churchill Falls energy deal that has been highly profitable for Hydro-Québec but much less so for Newfoundland and Labrador.

Under the deal, Hydro-Québec agreed to buy almost all the energy generated by a hydroelectric plant to be built on the Churchill River in Labrador.

The contract, which had a 65-year term, set a fixed price for the energy that would decrease in stages over time.

The dam has generated more than $26 billion for Hydro-Québec compared with about $2 billion for Newfoundland and Labrador.

The Churchill Falls power development in central Labrador, is pictured under construction which was completed in late 1971. HO / THE CANADIAN PRESS

Churchill Falls (Labrador) Corp. Ltd. went to Quebec Superior Court in 2010, arguing unsuccessfully that the sizeable profits from electricity were unforeseen in 1969 and that Hydro-Québec had a duty to renegotiate the contract.

An appeal court affirmed that ruling and, as usual, the Supreme Court did not give a reason for agreeing to hear the case.

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