Behind the posturing on Lower Churchill

Churchill Falls - Hydro-Québec / Énergie NB

You have to figure that Bloc Québécois leader Gilles Duceppe had a hard time keeping a straight face as he railed against Conservative leader Stephen Harper's promise of federal aid to develop the Lower Churchill power project in Labrador.
"A direct attack on Quebec," he thundered. "A slap in the face."
As the self-anointed front-line defender of Quebec's interests in Ottawa, Duceppe would of course say that - even though it was the biggest break for Bloc fortunes so far in this election campaign.
It remains to be seen whether the Lower Churchill announcement will serve the Bloc as well as the Conservative arts-funding cuts did in the last federal campaign, but nothing works better for the Bloc than a perceived slight against Quebec. In this case the substance of the slight is minimal, but the symbolism looms large. Count on the Bloc, along with the provincial Quebec parties, to milk it for all it's worth.
Duceppe typically exaggerates when he claims Harper is financing a competitor to Hydro-Québec with Quebecers' money. In fact, Ottawa is merely providing loan guarantees, not actually handing over cash, for $4.5 billion of the $6.2-billion price tag of the Lower Churchill project, specifically to run undersea transmission lines from Labrador to Newfoundland and Nova Scotia.
(One can also suspect Harper of not being entirely forthright. He suggested that his decision to provide the assistance, which should save the project partners an estimated $20 million a year in interest payments, was to advance a clean-energy project that will assist the fight against climate change. Given his government's record on climate change, it's hard not to suspect that his primary concern here lies in boosting Conservative fortunes in a province where his party failed to win a seat last election.)
It's true that some of the Lower Churchill power is destined for export to the U.S., where it would compete with Hydro-Québec's product. But what competition it provides is unlikely to be very stiff. The amount available for export is expected to be relatively slight after the Newfoundland and Nova Scotia markets have been served. As well, the Lower Churchill power is expected to be considerably more costly to produce than that expected from the Romaine River hydro development in Quebec, and thus it is unlikely to drive the export price down unless Newfoundland and Labrador foolishly sells it at a substantial loss.
Quebec is hardly in a position to whine about being treated unfairly when it comes to hydroelectric development. It has profited handsomely, to the tune of billions of dollars, at Newfoundland's expense thanks to the sucker deal Newfoundland signed decades ago to sell its Upper Churchill power to Quebec at a fixed 1960s price. Quebec also could have got a share of the Lower Churchill action had it behaved in adult fashion and cut a deal to allow transmission across Quebec territory.
The Lower Churchill development is commendable for several reasons. It will be an economic boon to Atlantic Canada and it will be a clean-energy source that might allow the closure of some carbon-fuel-burning power plants. Instead of moaning about the unfairness of it all, Quebec should insist that Harper show he means it when he says that all provinces will get equitable treatment when it comes to green projects, and demand equivalent federal aid for such things as métro-line extensions, vehicle electrification and highspeed rail installation.

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