Starting next year, estimated rates are expected to gradually rise to $65 per megawatt-hour by 2020 compared to $6 now.
Natural Resources Minister Jerome Kennedy says the province will continue to offer competitively priced power while providing certainty for new mining operations.
Kennedy says the goal is to keep rates lower than those offered by the province's key competitor, Hydro-Quebec.
The government says the new annual rate is expected to generate hundreds of millions of dollars, much of which will be used to upgrade the Upper Churchill power dam and Labrador transmission lines.
Rates for Labrador residential and commercial customers will not be affected.