The Newfoundland and Labrador Regulation 110/25 establishes an inquiry under the Public Inquiries Act, 2006, to examine the Memorandum of Understanding (MOU) for a new long-term energy purchase and development initiative between Newfoundland and Labrador Hydro (NL Hydro) and Hydro-Québec, including the involvement of Churchill Falls (Labrador) Corporation Limited. The Order formally sets out the creation of the inquiry, appoints the inquiry committee, and defines the scope, powers, and expected outcomes of the investigation. The inquiry is mandated to assess whether the MOU aligns with the long-term interests of the province and its residents, considering economic, social, and governance factors.

The inquiry committee are tasked with reviewing and analyzing all relevant documentation, including the full MOU, supporting studies, draft term sheets, and correspondence related to the negotiation and execution of the agreement. The inquiry is expected to rigorously evaluate whether the MOU represents the best approach to harnessing the province’s hydroelectric resources while balancing financial, social, and environmental considerations.

The terms of reference provide detailed guidance on the matters the inquiry committee should examine. Among these is the appropriateness of the mandate given to negotiators representing NL Hydro and the provincial government, including its consistency with prior reports, such as the Commission of Inquiry Respecting the Muskrat Falls Project and the advice of the 2041 Churchill River Management Expert Panel. The inquiry will scrutinize the accuracy of projected revenues and benefits, including the valuation of $33.8 billion on a net present value basis, payments to Churchill Falls (Labrador) Corporation Limited, and annual forecasted payment schedules. Consideration will also be given to water rentals and royalties, employment creation estimates, and alternative markets for energy to determine whether Hydro-Québec is the optimal partner for the initiative.

The committee is directed to evaluate the economic and social benefits of proposed development projects at Churchill Falls and Gull Island, whether independent development might yield greater advantages, and any barriers to maximizing energy export opportunities. Governance and ownership structures, pricing mechanisms, and the allocation of energy and capacity are to be assessed for their alignment with the province being the principal beneficiary of its natural resources. The inquiry will also examine the reliability and cost-effectiveness of the proposed energy system, potential impacts on Muskrat Falls operations, and the appropriateness of contract durations for new power purchase agreements and exclusivity arrangements. Cost contingencies, financial risk exposure, and the overall long-term value to the province are additional focal points.

Newfoundland (110/2025) December 23, 2025
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