Carney announces $10-billion financing package for Labrador clean energy expansion

Prime Minister Mark Carney announced a sweeping clean energy agreement Monday that the federal government says will support nearly $70 billion in new electricity infrastructure in Labrador, including an expansion of the Churchill Falls generating station and development of the long-discussed Gull Island hydroelectric project. Announced in St. John’s alongside Quebec Premier Christine Fréchette, Newfoundland and Labrador Premier Tony Wakeham and the heads of Hydro-Québec and Newfoundland and Labrador Hydro, the agreement includes $10 billion in federal financing for the projects, associated transmission infrastructure and opportunities for Innu co-investment in a major onshore wind development in Labrador.

Ottawa is billing the package as the largest clean energy investment in North American history. The combined projects are expected to produce about 14,000 megawatts of renewable electricity — nearly three times the existing capacity at Churchill Falls — while supporting an estimated 23,000 construction jobs and contributing $31 billion to Canada’s economy through the early 2040s. The new arrangement also marks another major step in reshaping the energy relationship between Quebec and Newfoundland and Labrador after decades of political controversy surrounding the original 1969 Churchill Falls power agreement. Wakeham said the new deal would give Newfoundland and Labrador greater control over how its electricity is used, including whether power is directed toward domestic economic development or sold to outside markets.

The announcement also links the energy expansion to the federal government’s push to accelerate mining and infrastructure development in the Labrador Trough, a mineral-rich region spanning Labrador and Quebec. Carney announced that the Labrador Trough Clean Power, Critical Minerals and Infrastructure Corridor will be referred to the federal Major Projects Office, which is intended to coordinate financing, permitting and Indigenous partnerships for large projects. Ottawa will also support early-stage work on transmission infrastructure in Labrador West, the proposed Kami iron ore project near Wabush, infrastructure serving Focus Graphite’s Lac Knife project in Quebec and expanded mineral-handling and rail capacity at Pointe-Noire. The government argues that combining large-scale renewable generation with new transmission and mining infrastructure could strengthen Canada’s electricity grid while opening additional critical-mineral development and export opportunities.