The member of parliament for Labrador says Nalcor and the provincial government should be looking northward for energy customers to purchase excess power from Muskrat Falls, instead of looking south.

Yvonne Jones said if the province and its energy corporation can co-operate with their counterparts in Quebec, an energy grid could be built to supply arctic and subarctic communities surplus power from the Muskrat Falls hydroelectric dam, replacing the costly and inefficient diesel generators that currently serve many northern communities.

"It is a viable option, in my mind, when you look at the fact that there's going to be a need to replace the power sources," Jones said.

Jones' comments come in the wake of statements from premiers of both Newfoundland & Labrador and Quebec about "burying the hatchet" after a decades-old feud stemming from the Upper Churchill deal, which gave Hydro-Quebec deep-discounted power from the Churchill Falls generating station.

Jones said any future deals between the two provinces should hinge on renegotiating Upper Churchill.

"That is one of the priorities that will have to be raised and discussed," she said.

"These are two premiers and provinces who sit at the table now on a regular basis with the prime minister and the first ministers in Canada. It's understandable that they would start building a stronger relationship."

Muskrat Falls energy could replace diesel generators 

When Muskrat Falls was first sanctioned, politicians suggested excess power could be sold to American customers along the Eastern Seaboard. But with oil and natural gas prices dropping and the cost of hydroelectric power from Muskrat Falls expected to rise, that has proven to be a tough sell.

A 2015 senate report found northern electricity systems to be "aging, underperforming and at capacity."

Jones admitted building a transmission grid to serve small, remote communities would be expensive, but she said all options are going to require a big investment.

"We talk about clean energy, replacing diesel across the North and the Arctic," she said.

"There is a role in this project to ensure there is a northern corridor for transmission of power."