Newfoundland and Labrador's wholly owned energy corporation is taking another step toward developing the Lower Churchill hydroelectric megaproject.

Nalcor has filed environmental assessment documents for a transmission line that would connect Labrador and Newfoundland.

The 1,200-kilometre line, if approved, would start at the site of the proposed Gull Island power plant, one of two key sites in the Lower Churchill project, and wind its way to the Avalon Peninsula, on the island's east coast.

Nalcor is planning to lay protected cables on the seabed across the Strait of Belle Isle.

The link would have the capacity to carry 800 megawatts of electricity, which is more than enough power to replace the oil-fired generating station in Holyrood.

The $2-billion project would also include capacity to extend a transmission line that could run along the island's west coast and then across the Cabot Strait to the Maritime provinces.

Premier Danny Williams has been pitching the Lower Churchill project as a clean, renewable source of energy to feed markets in other provinces or the U.S.

Nalcor president Ed Martin said the proposed link "will interconnect the island portion of the province with the North American electricity system and help set the stage for further development and growth in the province's energy sector."

In a statement, Martin also said the line can help the province meet its energy requirements.

Nalcor said the public will be given an opportunity to comment on the proposal as the environmental review process proceeds.