Future of Quebec energy deal unknown after Newfoundland and Labrador election

Newfoundland and Labrador premier-designate Tony Wakeham arrives to speak at a Progressive Conservative campaign party on election day in Stephenville, N.L., on Tuesday, Oct. 14, 2025. THE CANADIAN PRESS/Gerri Lynn Mackey/VOCM News

The premier of Quebec says he is committed to working with Newfoundland and Labrador following election results that have cast doubt on a tentative energy deal between the provinces.

The agreement benefits both sides, François Legault said in a social media post Wednesday morning.

“Please be assured of our full commitment to continue our collaboration with Newfoundland and Labrador,” Legault wrote.

He also congratulated Progressive Conservative Leader Tony Wakeham for winning Newfoundland and Labrador’s provincial election on Tuesday night. The Tories won a slim majority, ending 10 years of Liberal rule.

The centrepiece of the Liberal’s failed re-election campaign was the tentative agreement with Hydro-Québec, which would see the utility pay much more for power from the Churchill Falls plant in Labrador. The deal is also expected to lead to new hydroelectric projects along the Churchill River.

Wakeham has repeatedly called for the agreement to be reviewed by an independent third party, pointing to lessons from Newfoundland and Labrador’s past energy project debacles.

During his victory speech Tuesday night, he vowed to have the deal reviewed and then put it to the public in a referendum.

“I will use that review to fix this deal or demand a better one,” he told supporters in western Newfoundland. “Given the generational stakes, I will not sign any deal that Newfoundlanders and Labradorians do not approve in a referendum.”

Hydro-Québec and Newfoundland and Labrador Hydro have been negotiating final, binding agreements for months, with an aim to finish in April 2026. It’s not clear how a review or a referendum in Newfoundland and Labrador would upset those plans.

Jennifer Williams, chief executive of Newfoundland and Labrador Hydro, warned earlier this year that a pause in the negotiations could send a negative message about what it’s like to do business with the province.

She congratulated Wakeham and his team in an emailed statement Wednesday. “I look forward to connecting with premier-designate Wakeham in the days ahead to discuss how the crown electricity assets are integral to and contribute to the vision and plans for the province’s future,” Williams said.

Hydro-Québec also congratulated Wakeham. “We remain confident that the current agreement is fair and beneficial for both parties,” said spokesperson Lynn St-Laurent in a statement.

“Significant progress has been made in recent months toward a detailed agreement, and we remain fully committed to continuing negotiations with our partner, (Newfoundland and Labrador) Hydro.”

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Political scientist Russell Williams said it is possible the memorandum of understanding may collapse in light of Tuesday’s election results. But that was always a possibility, said Williams, an associate professor at Memorial University. He pointed to Legault’s cratering support in Quebec, where an election is scheduled for next year.

Williams said whoever came to power in Tuesday’s election would be up against the possibility of not reaching final agreements by the time a new government is elected in Quebec — likely the Parti Québécois, according to polls. A new Quebec government may want different terms in the arrangement, he added.

“Both parties could have ended up owning a lemon in that they couldn’t get that deal over the line, at least not in a way that enjoys broad support in (Newfoundland and Labrador),” Williams said.

Ultimately, it was “nightmarishly stupid” of the Liberals not to have the draft deal evaluated by an independent expert, he said. The agreement became a source of controversy as energy watchers dug into its details and questioned whether it offered a fair return for Newfoundland and Labrador.

Earlier this year, a member of a three-person panel appointed to provide oversight of final agreement negotiations resigned from his post, citing concerns about the panel’s independence.

Williams said the uproar undermined the main plank of the Liberals’ campaign — namely, that the deal would change the game for the financially fragile province and allow the government to make big investments in health care and education and pay off debt.

“If you’re going to say this is the best deal ever and in the future, the roads are going to be paved in gold, that should be able to stand the test of some independent kicking of the tires,” he said.

The Liberals have said the deal would bring Newfoundland and Labrador roughly $225 billion over the next 50 years. The province’s net debt is expected to hit $19.7 billion next year, for a population of about 545,000 people.

This report by The Canadian Press was first published Oct. 15, 2025.