Churchill Falls (Labrador) Corporation Limited

Churchill Falls (Labrador) Corporation

Type	Subsidiary - Newfoundland and Labrador Hydro Nalcor Energy (65.8%) Hydro-Québec (34.2%)
Industry	Electricity generation & distribution
Founded	St. John's, Newfoundland (1958)
Headquarters	St. John's, Newfoundland, Canada
Key people	Ed Martin, President & CEO
Products	Electricity
Website	www.cflco.nf.ca

The Churchill Falls (Labrador) Corporation, also known as CF(L)Co or CFLco is a Canadian electric company. The company was founded in 1961 and is based in St. John's, Newfoundland. Churchill Falls (Labrador) Corporation Limited operates as a subsidiary of Newfoundland and Labrador Hydro.^[1]

History

CF(L)Co was originally formed in 1958 as a subsidiary of British Newfoundland Development Corporation (BRINCO) and known as the Hamilton Falls Power Corporation, it built and operated the Churchill Falls hydroelectric complex.

In 1961, the Government of Newfoundland and Labrador granted the Hamilton Falls Power Corporation a 99-year lease to the 67,340 square kilometers watershed of the Upper Churchill. The Hamilton Falls Power Corporation became to be known as the Churchill Falls Corporation in 1965 when the name of the falls was changed to commemorate former British Prime Minister Winston Churchill.

CF(L)Co began construction on Churchill Falls Generating Station in 1966 and on May 12, 1969, signed a power contract^[2] with Hydro-Québec. The agreement committed Hydro-Québec to buy most of the plant's output at one-quarter of a cent per kilowatt-hour — the exact rate is 0.25425 cents per kilowatt-hour until 2016 and 0.20 cents for the last 25 years of the contract^[3] —, to build and maintain power lines to carry the power to market and to enter into a risk-sharing agreement whereas the Quebec Crown corporation would cover part of the interest risk and buy some of BRINCO's debt, in exchange for a increased share in CF(L)Co.

The 5,428-megawatt generating station delivered its first kilowatts on December 6, 1971^[4] and its 11 turbines were fully operational by June 1974. In 1974 the Government of Newfoundland and Labrador purchased a controlling interest in CF(L)Co from BRINCO and turned it over to the Newfoundland and Labrador Power Commission. The Commission had a 65.8% share in the corporation and the remaining 34.2% was owned by Hydro-Québec.

Legal battle

In 1967, the year CF(L)Co qualified for Crown Corporation status, the Newfoundland Government initiated proceedings in the Newfoundland Supreme Court to recall 800 megawatts (MW) of the Churchill Falls power from CF(L)Co based upon the lease granted to the corporation in 1961. By 1980, the case had not been resolved, and in that year the Newfoundland Legislature passed the Re Upper Churchill Water Rights Reversion Act to reclaim the water rights granted to the corporation.

Both legislations and the contract itself were subject to protracted legal battles between the two neighboring provinces, ending up before the Supreme Court of Canada. The court declared the Upper Churchill Water Rights Reversion Act ultra vires in 1984,^[5] and twice affirmed the validity of the 1969 contract in 1988.^[6][7]

External links

• Newfoundland and Labrador Hydro website
• Nalcor Energy website
• The loophole in the 1969 Hydro-Québec/CFLCo. agreement

See also

• Churchill Falls
• Hydro-Québec
• Nalcor
• Lower Churchill Project

References

1. ^ "Churchill Falls (Labrador) Corporation Limited". Bloomberg Businessweek. http://investing.businessweek.com/research/stocks/private/snapshot.asp?privcapId=879728. Retrieved 29 September 2010. 
2. ^ "Power Contract Between the Quebec Hydroelectric Commission and the Churchill Falls (Labrador) Corporation" (pdf). Montréal: archive.org. 1969. http://www.archive.org/download/PowerContractBetweenTheQuebecHydro-electricCorporationAndChurchill/1969_ChurchillFallsContract.pdf. Retrieved 2009-12-02. 
3. ^ Nalcor (2009) (pdf). Annual Report 2008. St. John's. pp. 76. ISBN 978-2-550-55046-4. http://www.nalcorenergy.com/assets/nalcor%20annual%20report_final%20version.pdf. 
4. ^ Green, Peter. "The History of Churchill Falls". IEEE Canada. http://www.ieee.ca/millennium/churchill/cf_history.html. Retrieved 2009-03-16. 
5. ^ Supreme Court of Canada (May 3, 1984). "Reference re Upper Churchill Water Rights Reversion Act, (1984) 1 S.C.R. 297". LexUM. http://csc.lexum.umontreal.ca/en/1984/1984rcs1-297/1984rcs1-297.html. Retrieved 2009-12-02. .
6. ^ Supreme Court of Canada (June 9, 1988). "Newfoundland (Attorney General) v. Churchill Falls (Labrador) Corp., (1988) 1 S.C.R. 1085". LexUM. http://scc.lexum.umontreal.ca/en/1988/1988rcs1-1085/1988rcs1-1085.html. Retrieved 2009-12-02. .
7. ^ Supreme Court of Canada (June 9, 1988). "Hydro-Québec v. Churchill Falls (Labrador) Corp., (1988) 1 S.C.R. 1087". LexUM. http://scc.lexum.umontreal.ca/en/1988/1988rcs1-1087/1988rcs1-1087.html. Retrieved 2009-03-14. .