Churchill Falls Labrador Corporation Limited
Encyclopedia
The Churchill Falls 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
.
(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 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 —, to build and maintain power line
s 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 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
.
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, and twice affirmed the validity of the 1969 contract in 1988.
St. John's, Newfoundland and Labrador
St. John's is the capital and largest city in Newfoundland and Labrador, and is the oldest English-founded city in North America. It is located on the eastern tip of the Avalon Peninsula on the island of Newfoundland. With a population of 192,326 as of July 1, 2010, the St...
. Churchill Falls (Labrador) Corporation Limited operates as a subsidiary of Newfoundland and Labrador Hydro
Newfoundland and Labrador Hydro
Newfoundland and Labrador Hydro is a provincial Crown corporation that generates and delivers electricity for Newfoundland and Labrador, Quebec, and the north-eastern areas of the United States. It also delivers voice and data services to customers in some areas...
.
History
CF(L)Co was originally formed in 1958 as a subsidiary of British Newfoundland Development CorporationBritish Newfoundland Development Corporation
The British Newfoundland Development Corporation, or BRINCO was incorporated by a consortium of British companies in 1953 which undertook industrial development opportunities in the Canadian province of Newfoundland and Labrador...
(BRINCO) and known as the Hamilton Falls Power Corporation, it built and operated the Churchill Falls
Churchill Falls
Churchill Falls are waterfalls named after former British Prime Minister, Winston Churchill. They are high, located on the Churchill River in Newfoundland and Labrador, Canada....
hydroelectric
Hydroelectricity
Hydroelectricity is the term referring to electricity generated by hydropower; the production of electrical power through the use of the gravitational force of falling or flowing water. It is the most widely used form of renewable energy...
complex.
In 1961, the Government of Newfoundland and Labrador
Newfoundland and Labrador
Newfoundland and Labrador is the easternmost province of Canada. Situated in the country's Atlantic region, it incorporates the island of Newfoundland and mainland Labrador with a combined area of . As of April 2011, the province's estimated population is 508,400...
granted the Hamilton Falls Power Corporation a 99-year lease
99-year lease
A 99-year lease was, under historic common law, the longest possible term of a lease of real property. It is no longer the law in most common law jurisdictions today, yet 99-year leases continue to be common as a matter of business practice and conventional wisdom.-The law:Under the traditional...
to the 67,340 square kilometers watershed
Drainage basin
A drainage basin is an extent or an area of land where surface water from rain and melting snow or ice converges to a single point, usually the exit of the basin, where the waters join another waterbody, such as a river, lake, reservoir, estuary, wetland, sea, or ocean...
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
Winston Churchill
Sir Winston Leonard Spencer-Churchill, was a predominantly Conservative British politician and statesman known for his leadership of the United Kingdom during the Second World War. He is widely regarded as one of the greatest wartime leaders of the century and served as Prime Minister twice...
.
CF(L)Co began construction on Churchill Falls Generating Station
Churchill Falls Generating Station
The Churchill Falls Generating Station is a hydroelectric power station located on the Churchill River in Newfoundland and Labrador. The underground power station can generate 5,428 MW, which makes it the second-largest in Canada, after the Robert-Bourassa generating station. The generating station...
in 1966 and on May 12, 1969, signed a power contract with Hydro-Québec
Hydro-Québec
Hydro-Québec is a government-owned public utility established in 1944 by the Government of Quebec. Based in Montreal, the company is in charge of the generation, transmission and distribution of electricity across Quebec....
. 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 —, to build and maintain power line
Power Line
Power Line is an American political blog, providing news and commentary from a conservative point-of-view. It was originally written by three lawyers who attended Dartmouth College together: John H. Hinderaker, Scott W. Johnson, and Paul Mirengoff...
s to carry the power to market and to enter into a risk-sharing agreement whereas the Quebec
Quebec
Quebec or is a province in east-central Canada. It is the only Canadian province with a predominantly French-speaking population and the only one whose sole official language is French at the provincial level....
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 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
Newfoundland and Labrador Power Commission
The Newfoundland and Labrador Power Commission is the former name of Newfoundland and Labrador Hydro.The NPC was created in 1954 by the Government of Newfoundland and Labrador to provide rural electrification across the province...
. The Commission had a 65.8% share in the corporation and the remaining 34.2% was owned by Hydro-Québec
Hydro-Québec
Hydro-Québec is a government-owned public utility established in 1944 by the Government of Quebec. Based in Montreal, the company is in charge of the generation, transmission and distribution of electricity across Quebec....
.
Legal battle
In 1967, the year CF(L)Co qualified for Crown Corporation status, the Newfoundland Government initiated proceedings in the Newfoundland Supreme CourtSupreme Court of Newfoundland and Labrador
The Supreme Court of Newfoundland and Labrador is the superior court for the Canadian province of Newfoundland and Labrador. The Supreme Court of Newfoundland and Labrador has jurisdiction to hear appeals in both criminal and civil matters from the Supreme Court of Newfoundland and Labrador ,...
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
Re Upper Churchill Water Rights Reversion Act
Reference Re Upper Churchill Water Rights Reversion Act [1984] 1 S.C.R. 297 is a famous constitutional reference question put the Supreme Court of Canada. The Court found that legislation passed by the government of Newfoundland to take back water rights contracted out to the province of Quebec was...
to reclaim
Water reclamation
Water reclamation is a process by which wastewater from homes and businesses is cleaned using biological and chemical treatment so that the water can be returned to the environment safely to augment the natural systems from which it came...
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
Supreme Court of Canada
The Supreme Court of Canada is the highest court of Canada and is the final court of appeals in the Canadian justice system. The court grants permission to between 40 and 75 litigants each year to appeal decisions rendered by provincial, territorial and federal appellate courts, and its decisions...
. The court declared the Upper Churchill Water Rights Reversion Act
Re Upper Churchill Water Rights Reversion Act
Reference Re Upper Churchill Water Rights Reversion Act [1984] 1 S.C.R. 297 is a famous constitutional reference question put the Supreme Court of Canada. The Court found that legislation passed by the government of Newfoundland to take back water rights contracted out to the province of Quebec was...
ultra vires
Ultra vires
Ultra vires is a Latin phrase meaning literally "beyond the powers", although its standard legal translation and substitute is "beyond power". If an act requires legal authority and it is done with such authority, it is...
in 1984, and twice affirmed the validity of the 1969 contract in 1988.