Power generation in Labrador: Hydro-Québec secures Québec’s energy future, at a competitive cost

St. John’s, Newfoundland – Hydro-Québec announced the signing of a Definitive Cooperation and Implementation Agreement (DCIA) with Newfoundland and Labrador Hydro (NL Hydro) that will ensure reliable power supply to meet the needs of Québec for the next 50 years, at a competitive rate of 6¢/kWh. This price is one-third of other alternatives. 

This enhanced agreement lays the foundation for the largest renewable energy project in North America. For Hydro-Québec, it provides access to a total potential of over 10,000 MW of electricity from Labrador, equivalent to double the current production. From this, 6,915 MW are firm and 3,850 MW are associated with the potential of projects currently under study. In comparison, the 2024 memorandum of understanding provided for a total potential of 7,200 MW. 

Specifically, this agreement will:

• Secure more electricity (6,915 MW):
  • Guarantee supply from Churchill Falls until 2077.
  • Increase supply for Québec:
    • Churchill Falls capacity increase revised upward.
    • Construction of Gull Island generating station and addition of a supplementary generating unit.
• Enable the study of new projects (3,850 MW):
  • Wind farm in Labrador.
  • Hydroelectric facility in Churchill Falls.
• Take advantage of existing Government of Canada financing totalling $6.5 billion, without governance rights.

The 2026 DCIA will therefore strengthen Hydro-Québec’s energy portfolio for the next 50 years at a cost lower than that of the 2024 agreement and one-third the cost of the alternatives. Note that the projected generation cost beyond 2035 is approximately 17¢/kWh.

Further, Hydro-Québec will be able to purchase NL Hydro’s surplus electricity under a preestablished pricing mechanism. 

Hydro-Québec is committed to continuing the dialogue initiated in 2024 with Indigenous and local communities in Québec and Labrador in order to support their active participation in the planning and implementation of the projects. This collaboration will focus on future prospects and the creation of lasting benefits, among other things. The energy development being planned will be carried out in a spirit of collaboration, openness and respect, drawing on the essential contribution of businesses and workers in Newfoundland and Labrador. 

At the same time, Hydro-Québec will continue to implement its ambitious Action Plan 2035 in Québec, which remains just as essential given the scale of electricity demand. This includes an ambitious energy efficiency pathway with $10 billion in investments by 2035.

Finally, the agreement announced today enables Hydro-Québec to consolidate its North American leadership in renewable energy and propel Québec into the future.