Most residents of Newfoundland and Labrador loathe Hydro-Québec, a result of the wildly lopsided agreement that former premier Joey Smallwood signed in the 1970s for revenue-sharing from Labrador’s Upper Churchill Falls hydro project. That much-hated deal funnels most of the money and power from the project to Quebec until 2041.

Since the turbines first began turning, almost every premier of Newfoundland and Labrador has tried to reopen the contract, either by negotiating a new deal or through the courts — all to no avail. The two provinces have also been unable to agree on terms for developing other Labrador hydroelectric projects. And while Quebec enjoys huge profits from selling Churchill Falls power to New England, Canada’s federal government has steadfastly refused to use legislation to open a power corridor through Quebec in order to allow Newfoundland and Labrador to do the same.

So, public reaction in Newfoundland and Labrador was initially positive last autumn when former premier Danny Williams announced a deal had been signed with Emera Inc. that would allow the province to bypass Quebec by transmitting power from a new hydro project at Muskrat Falls, also on the Churchill River, to Nova Scotia and then south to the U.S., using new, high-tech undersea cables.

But Williams’ successor, Cathy Dunderdale, has proven poor at dealing with worries about who will pay for the project. The province’s power company, Nalcor Energy Ltd., estimates that the Muskrat Falls project will double rates for consumers, although Nalcor points out that hydro bills will undoubtedly rise in any case.

The big question Dunderdale hasn’t answered is why the province is pushing so hard to complete such an expensive power project when it has the far simpler option of waiting for the clock to run out on the original power contract with Quebec.

The end of the contract is not as distant as it seems for Hydro-Québec: that province’s opportunity to negotiate decades-long power contracts with U.S. clients is rapidly shrinking.

If the terms of the Upper Churchill Falls deal had not favoured Quebec to such a degree, then perhaps Newfoundland and Labrador would be less inclined to let it expire. But the province currently receives precious little revenue from selling power to Quebec. In fact, it might even gain economically by draining the hydro reservoir and allowing the flooded lands to reappear — after all, who knows what mineral wealth lies obscured under a man-made body of water larger than Ontario’s Lake St. Clair?

Such a scenario is highly unlikely, of course, because Quebec will need to keep electricity flowing from the existing Upper Churchill power plant. And when negotiations do commence, it will be the turn of Newfoundland and Labrador to exert leverage over its hitherto reluctant neighbour.

At that point, serious discussions can commence between the two provinces on developing the many hydroelectric power opportunities that exist in Labrador, including Muskrat Falls. But that would require long-term thinking from politicians in Newfoundland and Labrador, a rare commodity — particularly in an election year. IE