Too late for Lower Churchill?
Hydro deal a difficult task: analyst
The time for a deal to develop the Lower Churchill hydroelectric project in Labrador may have come and gone, says an industry analyst.
The U.S. marketplace – the main market for electricity generated in Labrador – is demanding smaller, more environmentally friendly sources of energy, said Brian Lee Crowley, president of the Atlantic Institute for
Market Studies, a conservative think-tank based in Halifax.
“These big hydroelectric megaprojects are not as attractive as they once were,” he said Wednesday.
Faced with an $840-million provincial deficit, Newfoundland Premier Danny Williams has made the Lower Churchill project a priority for his government.
The province has been seeking a development deal for two decades and next month will issue an official call for bids of interest.
Natural Resources Minister Ed Byrne disagrees with the criticisms, noting that hydro energy is among the most Earth-friendly methods of power.
“(The comments) demonstrate an opinion or an attitude,” Byrne said late Wednesday night, “but the opinion put forward is so ill-informed, and I’ll be corresponding with Mr. Crowley … to put our point of view forward and to hopefully get a response from him because I firmly believe his assumptions are flawed.”
The only group to show any interest recently includes a Chinese company under sanctions by the U.S. government.
The Sino Energy Consortium is comprised of B.C.-based Procon Mining and Tunnelling Ltd., PCL Construction Group Inc., and China National Machinery and Equipment Import and Export Corp.
China National is under sanction by the U.S. government for trading with Iran contrary to a U.S. ban on trade in biological or chemical weapons.
Even Quebec, the main benefactor of the original Churchill Falls hydroelectric development, hasn’t spoken publicly about the project.
The lack of interest didn’t stop municipal officials from Labrador from unveiling Wednesday their list of demands for any would-be deal.
The Combined Councils of Labrador (CCL) say any agreement should give Labradorians priority for jobs, and lower utility costs. The Trans-Labrador Highway would have to be upgraded and local companies given first rights to cut trees in the area, the council said in a report provided to Byrne.
Graham Letto, vice-president for Labrador West with the CCL, said he hopes his observations of Williams’ dedication to the project are correct but just wants to ensure Labrador receives more benefits from it.
“Seeing as how the Lower Churchill development is pretty high on the premier’s list and seems to be a priority of his government, we figured we’d get on the bottom floor and present to government some of our issues … that should be included in any development of the Lower Churchill,” Letto said in the lobby of Confederation Building Wednesday.
“We’re of a strong belief that any development of the Lower Churchill should have some type of adjacency principle in place that would give the aboriginals and the people of Labrador first chance at job opportunities and certainly training for any long-term positions there.”
Byrne said the government is not responsible for decision making in all areas requested by the CCL, but was pleased with his meeting with CCL representatives Wednesday.
“While I compliment the Combined Councils for coming forward with their list as project-specific, we’re not even close to discussing details,” he said. “We’ve just begun the process of looking at what might be available to us.”
But most contentious of all, the agreement would have to redress what Newfoundland and Labrador considers the most vexing of all wrongs the province has suffered at the hands of mainland Canada – revenue-sharing with Quebec on the existing Churchill Falls dam.
Completed in 1972, Churchill Falls is one of the largest power installations in the world.
Newfoundland signed a deal with Quebec that has seen the mainland province reap at least $850 million in profits while Newfoundland has gained little. The agreement doesn’t expire until 2041.
“The original Churchill Falls contract has been the subject of provincial debate and embarrassment since it’s signing,” says the municipal report.
Quebec and the U.S. thrive at the expense of Labrador, it says, which has no say in further development of the river.
“Until this situation is corrected, there is little chance of public buy-in within Labrador.”
Big energy projects falling out of favour
Too late for Lower Churchill?