Monday, September 17, 2012

No way - Power Struggle Part 11 of 12

 John Efford says Ottawa won't force power corridor through Quebec from Lower Churchill

“First of all, I haven’t read the Constitution and I’d rather have to seek constitutional advice, but the last thing the federal government wants to do and I think the last thing you as a citizen want to do is to see the federal government overpower the right of Canadians in their provinces.”
— Newfoundland MP John Efford in 2005, when he served as federal minister of Natural Resources.

Eleventh in a 12-part series.

The defunct weekly provincial newspaper, The Independent (2004-2008), carried out extensive research and investigation into the Upper Churchill. From the contract’s signing in the 1960s, to the realization of its incredible lopsided nature towards Quebec, the shadow of the deal looms today over the potential development of Labrador’s Muskrat Falls. The following is the 11th in a series of 12 articles published in The Independent.

Jeff Ducharme
The Independent
Feb. 6, 2005

MP John Efford, the province’s point man in the Liberal cabinet, says Ottawa won’t step in to help Newfoundland and Labrador push a power corridor through Quebec.

Since Churchill Falls first became an issue between the province and Quebec in the 1960s, Newfoundland and Labrador has been trying to convince Ottawa to allow it to build power transmission lines through Quebec as a means to deliver hydroelectricity to lucrative U.S. markets, but with no success.

“Are we going to tell the people of Canada, or the people of Quebec, or the people of Newfoundland, you must do this — no,” Efford tells The Independent.

“The only answer I can give you today — I would be willing to be part of the discussions, but I can’t tell you, I’m not going to say that I would make sure it happens, or I could make it happen.”

Since 1972, Hydro-Quebec has gathered an estimated $23.8 billion in revenues from the sale of electricity under the infamous upper Churchill contract.

Only three per cent of the profits that Hydro Quebec has raked in — approximately $680 million — have landed in Newfoundland and Labrador coffers.

The provincial government has been criticized for signing the Upper Churchill deal in the first place, but some contend the federal government left the province with little choice because it wouldn’t step in and force the corridor through Quebec on constitutional grounds.
Clause No. 92 of the Canadian Constitution suggests the feds could force Quebec’s hand in allowing a corridor through the territory “for the general advantage of Canada or for the advantage of two or more of the provinces.”

Ontario has already expressed interest in power from the lower Churchill.

“First of all, I haven’t read the Constitution and I’d rather have to seek constitutional advice, but the last thing the federal government wants to do and I think the last thing you as a citizen want to do is to see the federal government overpower the right of Canadians in their provinces,” Efford says.

The Upper Churchill contract, which expires in 2041, is a wound that’s festered in Newfoundland and Labrador since the deal was signed — even school children know the details.

With the Lower Churchill once again on the provincial government’s to-do list, Quebec still stands in the way.

The so-called Atlantic route (across the Strait of Belle Isle, down the Northern Peninsula and across the Gulf of St. Lawrence) had been explored as a means to bypass Quebec, but critics say it would be too expensive and inefficient.

That leaves Quebec.

“… I’m willing to work with the premier and the government of Quebec (in) my capacity of Natural Resources to see what needs to be addressed,” Efford says.
At the same time, he knows there has been no shortage of premiers from this province who thought they could force a corridor through Quebec by appealing to Ottawa and using constitutional arguments.

From Joey Smallwood to Brian Peckford, they all failed to convince Ottawa.

In the 1980s, the government of then-premier Peckford tried to negotiate a deal to develop and then sell power from the lower Churchill.

The Quebec government wielded a heavy hand — as they did during negotiations over the upper Churchill — and railed against suggestions that they should allow Newfoundland to transmit power through Quebec and into the U.S. market.

The federal government refused to give Peckford, who felt the province had the constitutional right to transmit electricity through Quebec, a commitment that it would step in.

Efford says the mandate of Canada has always been to “work co-operatively” within Confederation.

The fact that Canada is facing an energy shortage could further another constitutional challenge by Newfoundland and Labrador.
“There’s such a massive shortage of power, the co-operation between the provinces needs to happen,” admits Efford.
“We don’t have a grid that connects the west to the east or even the east to central Canada and those things are under discussion.”
Hydro-Quebec’s current transmission lines that run into the United States are said to be already operating at maximum capacity. The cost to construct another line is approximately $1.7 billion.
The provincial government spent $70 million in the 1970s on construction of the Gull Island project on the lower Churchill River before the 2,000-megawatt development was put on hold due to financing and marketing problems.

The province has said that power generated from the smaller, 824-megawatt Muskrat Falls project (also on the Lower Churchill) would likely be kept for the province’s own use.

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