The Supreme Court of Canada will not force Hydro-Quebec to renegotiate a deal to buy cheap power from Churchill Falls. The country’s top court upheld that decision this morning.

It means Hydro-Quebec now can still buy cheap energy from this province, and the Supreme Court of Canada will not force the utility to renegotiate a 65-year contract to buy low-cost electricity from the Churchill Falls power station in Labrador.

The province filed action in the Quebec Superior Court in 2010, challenging the lop-sided 1969 Upper Churchill contract under the good faith clause. The 65-year contract set a fixed price for the power that decreases over time, with no price adjustment clause.

Under the deal, Hydro-Québec agreed to buy almost all the energy generated by a hydroelectric plant to be built on the Churchill River in Labrador, investing in the venture in exchange for a fixed price for the energy that would decrease in stages over time.


Since then, Quebec has seen huge profits and modest returns for residents of Newfoundland and Labrador.

This province has tried in the past to renegotiate or back out of the deal, without success. Quebec-Hydro, however, argues the deal was a fair one. The deal is now set to expire in 2041.