Newfoundland and Labrador House of Assembly, Wednesday 8 January 2025
The House met in an extraordinary special sitting under Standing Order 8(7) to debate the Memorandum of Understanding between Newfoundland and Labrador Hydro and Hydro-Québec. The third day of the four-day debate featured questioning of expert witnesses from Power Advisory (Managing Director Jason Chee-Aloy and Senior Manager Brady Yauch) about market assessments, the 5.9-cent effective price, Schedule F pricing mechanisms, Quebec's supply needs and the timing of the deal. Debate centred on whether the MOU should be sent for independent external review before any vote, the interpretation of the $33.8 billion figure, and lessons learned from the 1969 Churchill Falls contract and Muskrat Falls.
Orders of the Day
Extraordinary Debate on the NL Hydro-Hydro-Québec MOU – scheduling changes and introduction of Power Advisory witnesses
J. Hogan
The Government House Leader called Motion 1, thanked the NL Hydro team, and sought leave to amend the debate schedule so J.P. Morgan would appear in the evening and NL Hydro would return the next day. Power Advisory's Jason Chee-Aloy and Brady Yauch introduced their backgrounds and firm expertise in electricity market analysis.
Government House Leader questioning of Power Advisory on market assessments, Quebec's demand and MOU value
J. Hogan
Hogan questioned Power Advisory on the scope of their retention, market assessments, Quebec's urgent demand growth driven by electrification and economic activity, the limited supply options available to Hydro-Québec, and whether the timing was right. Chee-Aloy said Quebec needs power urgently, the timing is right with two motivated parties, and that lessons learned from 1969 in Schedule F help ensure fair value.
Opposition call to suspend/defer vote pending independent external review (LeBlanc recommendations)
T. Wakeham
The Leader of the Official Opposition read Recommendations 1 and 2 of the LeBlanc inquiry and repeatedly asked whether the government would suspend or defer any vote on the MOU until an independent external expert or the Public Utilities Board provided a robust review. Hogan replied that the recommendations would be followed, that projects affecting ratepayers would go to the PUB, but that it was inappropriate to suspend the debate at the MOU stage.
Point of order – running the clock during debate
B. Petten
The Opposition House Leader raised a point of order accusing the Government House Leader of dragging out his answers to run the clock on the Leader's questions. The Speaker ruled there was no point of order.
Leader of the Official Opposition questioning of Power Advisory on scope, timeline and documents
T. Wakeham
Wakeham questioned Power Advisory on whether they reviewed the public MOU, their scope of work (market assessments and valuing supply, started March 2023), whether documents could be listed (declined as commercially sensitive), whether they reviewed draft MOUs, Schedule G (out of scope), and other jurisdictions/undeveloped hydro sites. Chee-Aloy said transmission configuration limits Labrador's selling options and advised on Schedule F components.
Minister of Municipal and Provincial Affairs questioning on independence, Schedule F pricing and electricity/transmission basics
J. Haggie
Haggie questioned Power Advisory on their independence as paid consultants, whether Hydro or government influenced their recommendations, and asked for plain-language explanations of Schedule F pricing (blocks, replacement cost, spot markets, the 16-cent replacement figure raising the Churchill Falls price), how electricity is quantified, transmission economics and amortization periods. Chee-Aloy affirmed their independence and explained the portfolio pricing framework.
Member for Terra Nova questioning on firm history, Gull Island data, oversight and the LeBlanc recommendations
L. Parrott
Parrott questioned Power Advisory on their firm's history with CF(L)Co, Quebec, Muskrat Falls and CREAT, and established that their role was to provide market assessments as inputs, not to be the independent expert panel recommended by LeBlanc. He argued the MOU is being rushed without proper independent review, that the 2,250 MW Gull Island figure and other data came from NL Hydro and may rely on outdated numbers, and pressed on risk assessment. Hogan agreed to table a list of expert advisors.
Member for Lake Melville remarks on Muskrat Falls lessons and support for the MOU
P. Trimper
Trimper drew on his environmental consulting experience to discuss the 'demons of Muskrat Falls,' the attractiveness of Gull Island versus Muskrat Falls, the flawed 2008 decision to build Muskrat first, methylmercury concerns, Nalcor building on its own, and Indigenous partnership. Chee-Aloy offered outside perspectives that the MOU is being applauded nationally. Trimper expressed comfort with the deal and the negotiating team.
Recess until 1 p.m.
L. Dempster
The Deputy Government House Leader moved that the House recess until 1 p.m.; the motion carried and the House resumed at 1 p.m.
Continued Terra Nova questioning on pricing, alternate sale options and project assumptions
L. Parrott
Parrott questioned Power Advisory on the source of the 5.9-cent figure, an alternative option to redirect cheaper Churchill Falls power to Newfoundland and sell Muskrat Falls power to Quebec, ending the existing contract 17 years sooner, and what happens to Schedule F if CF2 and Gull Island are never built. Chee-Aloy said the MOU framework is superior to building transmission, and the Premier clarified that if Quebec does not proceed, the new CF PPA and Schedule F remain intact, worth about $180 billion, with the $17 billion and $3.5 billion option payments distinct.
Minister of IET questioning on fair market value, oversight, timing and partnership construction
A. Parsons
Parsons questioned Power Advisory on whether 5.9 cents is fair market value (yes), the need for independent oversight, the 'cheap power' characterization, and the benefits of partnering with Hydro-Québec on construction given their strong track record (la Romaine). He argued the transmission timelines fit mining projects in Labrador West and that Quebec's willingness to forfeit $1.3 billion signals genuine commitment.
Member for Labrador West questioning on contract length, fair-value concept and Hydro-Québec negotiations
J. Brown
Brown questioned Power Advisory on whether 50-year deals remain common for hydroelectric assets (yes), the fair-value concept in Schedule F as a departure from single-price contracts, inflationary/commodity pressures and supply-chain uncertainty favouring firming up agreements now, Schedule E expiring blocks and recall power, and insights into negotiating with Hydro-Québec. Chee-Aloy described Hydro-Québec as a well-run but difficult negotiator and reiterated the timing is right.
Minister of Finance questioning on the enabling framework, Schedule F versus 1969, and fair value
S. Coady
Coady questioned Power Advisory on the MOU being an enabling framework/guardrails toward definitive agreements, the timing for oversight, whether their advice is reflected (most in Schedule F), how Schedule F differs fundamentally from the fixed-price 1969 contract, why the deal is being applauded, why building own transmission is riskier, and whether fair value was extracted. Yauch explained the block-based pricing tied to spot markets, replacement costs and capacity.
Member for Baie Verte - Green Bay questioning on the $33.8 billion, replacement pricing and export sale prices
L. Paddock
Paddock challenged Power Advisory, arguing the $33.8 billion net present value (5.9 cents) is locked in per Quebec's view of a guaranteed four-cent price, and that Quebec's replacement supply cost (12-16 cents per Michael Sabia) and its actual export sale prices (8.18 cents in 2022, 10.3 cents in 2023 per SEC filings) mean NL settled for too low a price. Chee-Aloy maintained the price is not locked in and rises when Schedule F components trigger.
Minister of Fisheries questioning on whether $33.8 billion is locked in, timing, independence and NL Hydro leadership
G. Byrne
Byrne questioned Power Advisory on whether the $33.8 billion is locked in (Chee-Aloy said definitively it is not), whether this is the right time and best deal (yes, with two motivated parties), the risks of waiting (losing the deal and 17 more years at the old price), whether a paid expert can still be independent, and his high regard for CEO Jennifer Williams's integrity and leadership.
Point of order – whether Members questioned Jennifer Williams's integrity
L. Parrott
Parrott raised a point of order under Standing Order 49 objecting to Byrne's suggestion that Opposition members questioned Williams's integrity, saying they only questioned the accuracy of the numbers. The Speaker took the matter under advisement, and Byrne later clarified his exact words were that some members do not believe she is acting independently.
Recess until 3:10 p.m.
J. Hogan
The Government House Leader moved that the House recess until 3:10 p.m.; the motion carried.
Member for Bonavista questioning on independence, Labrador system modelling, data centre demand and Quebec's energy plans
C. Pardy
Pardy questioned Power Advisory on how his constituents view independence, whether their Labrador system modelling met PUB-quality standards, whether any team members worked concurrently on Quebec files (none), whether the MOU meets Labrador customer needs, and cited UBS and Hydro-Québec's 2035 action plan on soaring data centre and Quebec electricity demand, plus Schedule E ownership/energy allocations. Chee-Aloy confirmed the firm does not work for Hydro-Québec.
This is Tabled's summary of the sitting, written from the official record; Hansard is only ever quoted at the link above. Search Newfoundland and Labrador Hansard for the words themselves, or read this sitting in the archive.