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Bloc Quebecois Leader Gilles Duceppe speaks to reporters a campaign stop in Repentigny, Que., on March 31, 2011. (CHRISTINNE MUSCHI/REUTERS)
Bloc Quebecois Leader Gilles Duceppe speaks to reporters a campaign stop in Repentigny, Que., on March 31, 2011. (CHRISTINNE MUSCHI/REUTERS)

Sparks fly in Quebec after Harper backs Newfoundland hydro project Add to ...

Stephen Harper's triumphant return to Newfoundland threatens to trigger a harried retreat in Quebec.

After years of scrapping with former Newfoundland and Labrador Premier Danny Williams, the Ode to Newfoundland rang out Thursday as Mr. Harper returned to the province with an election promise to back a $4.2-billion loan for the Lower Churchill hydroelectricity project.

Quebec leaders have long opposed federal help for the project, saying Quebec financed its own massive hydroelectric expansion over the past 60 years. The loan guarantee would give the $6.2-billion project to build dams and 1,100 kilometres of underwater transmission lines to the mainland advantageous financing, driving costs down. It could also lower the wholesale price of electricity.

On top of that, the deal would put a dent in Hydro-Québec's decades-long domination of eastern power export to the United States.

Mr. Harper sold the promise by saying it's a national plan to finance projects that reduce greenhouse gas emissions. "We will do this in a way that is equitable across every region of Canada," he said.

After Conservatives were shut out of Newfoundland in the 2008 federal election, the promise may also win back some seats in the May 2 vote, judging by the reception from the current premier, Kathy Dunderdale. Her reaction was a far cry from the cries of "ABC" (Anything But Conservatives) heard from Mr. Williams, also a Conservative, in the last federal campaign.

"I would say they have more than a good chance of bringing home a number of seats," Ms. Dunderdale said. "The situation we found ourselves in during the last election was there was a feeling right across this province that we weren't being heard. The prime minister has made a very bold statement here."

But the fate of the 11 Conservatives with seats in Quebec may be an entirely different matter.

The financing is seen as a threat in the province, where hydro has powered more than just lights and cable TV. Hydro-Québec is one of the engines that transformed Quebec from an agrarian backwater into a modern economy over the second half of the 20th century. It's a source of pride and a symbol of independence.

"The Conservatives intend to finance a competitor of Hydro-Québec with our own tax money," Bloc Québécois Leader Gilles Duceppe charged as he travelled down the St. Lawrence River Valley campaigning in staunch nationalist territory.

"He was in a fight with Danny Williams. Now he wants to regain the hearts of Newfoundlanders with Quebeckers' money."

Quebec's share of federal tax dollars supporting the project will actually be relatively small, especially considering SNC-Lavalin, a Montreal-based engineering and construction company, has already won a major contract for construction. Future competitive concerns, and immediate political considerations, loom much larger.

"We never got a cent from Ottawa to finance our electrical transport lines. It's a slap in the face to Quebec," Mr. Duceppe said. "I can't wait to see how Quebec [Conservative]MPs will explain this one. But I have an idea. They'll shut up and sink to their knees, like usual."

The announcement sent the Quebec government scrambling. Premier Jean Charest was already under attack from the opposition Parti Québécois for failing to stand up to Mr. Harper. PQ Leader Pauline Marois accused Mr. Charest of trading a recent deal with Ottawa on the Old Harry oil and gas field in return for his silence on Lower Churchill.

Natural Resources Minister Nathalie Normandeau, who promised to comment on the deal, could not be found by the end of Thursday.

Before the announcement, Mr. Charest said he will soon take the opportunity to intervene in the federal election campaign but added little more.

"We don't have any objections to Newfoundland and Labrador developing Lower Churchill Falls. But our government has always been clear: We will not accept that the federal government interfere by funding a transmission line," the Premier said.

Some Conservative Newfoundlanders attending Mr. Harper's announcement said they expect Quebeckers might be more understanding, particularly given Newfoundland's past struggles, both economically and with hydro development.

The 1960s contract to export Newfoundland power from Upper Churchill Falls through Quebec has gone down as one of the all-time disasters, allowing Quebec to reap billions while Newfoundland barely broke even.

The two provinces have been on bad terms when it comes to electricity for most of the time since.

With reports from Rhéal Séguin in Quebec City and Shawn McCarthy in Ottawa

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