Building a new span to Montreal's south shore could take as long as 10 years and cost $5 billion, but Transport Minister Denis Lebel suggested it would also create 30,000 jobs and be paid for by a toll system.
"This project will be one of the most important of the decade," Lebel said.
"Given the importance of a project like this, we will do it as quickly as possible but while respecting the quality of the construction."
The Champlain Bridge is among the busiest in the country, carrying around 60 million vehicles annually.
Besides being a vital commuter link to downtown Montreal, it is estimated that $20 billion in international trade crosses the bridge every year.
But the 49-year-old, federally owned span has not aged well. Engineering reports released earlier this year warned it was "functionally deficient" and risked collapse.
Its fate has been a major concern of local leaders as Ottawa earmarked millions for repairs but had refused, until now, to commit to an outright replacement.
The mayors of Montreal and the south-shore city of Longueuil expressed relief at Lebel's announcement.
"This is excellent news for the greater Montreal area," said Montreal Mayor Gerald Tremblay. "A new bridge has significant implications for the economy, and for social and sustainable development as well."
Longueuil Mayor Caroline St-Hilaire, a former Bloc Quebecois MP, said Wednesday's announcement brought an end to "a period of concern about the effective lifespan of the Champlain Bridge."
The Conservatives were the only party not to pledge a new bridge to Montreal-area voters during the last election, and had faced heavy political pressure to announce their intentions.
Last week, opposition MPs tried tabling a motion in a parliamentary committee calling on the Tories to reveal plans for the bridge's future, but it was easily voted down.
The NDP sought to take some credit for Wednesday's announcement, saying it was about time the government listened to the growing chorus calling for a new bridge.
"We're happy that the government has finally come around to seeing things our way," said Jamie Nicholls, the party's deputy critic for transport and infrastructure.
"We've done an unprecedented pressure campaign on the government for the past six months for a new bridge and finally they accepted their own reports."
Aside from Ottawa's firm intention to build a new bridge, few specific decisions have been made — such as when construction will begin, where it will take place and how exactly it will be financed.
Even the $5 billion price tag is a high-end estimate, Lebel acknowledged. The cost of a new bridge had previously been pegged at around $1.3 billion.
Lebel explained that the government intended to offset most, or all, of the construction costs with the help of a private-public partnership and a toll system.
"Our government's goal is to build a new bridge across the St. Lawrence with little or no cost to taxpayers," Lebel said. "The financing model will be specified soon."
But the lone discordant note amid all the applause in Quebec revolved around the financing details — notably the tolls.
The NDP expressed concern that private control of the bridge, combined with user fees, could wind up gouging commuters.
The prospect of tolls elicited grumbling even before Lebel arrived at a posh Montreal hotel to make his announcement.
Lebel's provincial counterpart, Pierre Moreau, bluntly told reporters in Quebec City on Wednesday morning that he was dead-set against the idea of charging a fee to use the bridge.
"It is not a privilege to work on the island of Montreal," he said. "Those people who work in Montreal contribute to the city's economic health."
Moreau was conspicuously absent from Lebel's news conference — which included mayors Tremblay and St-Hilaire, along with several business leaders.
Moreau later downplayed his comments, saying the Quebec government wouldn't be "dogmatic" in its position on tolls. He also pointed out the bridge would belong to the federal government.
"It's clear that at the end of the day, it is their decision to make," Moreau said.
The rapid deterioration of the Champlain Bridge stands in sharp contrast to Montreal's other, sturdier bridges that connect it to the south shore.
The Jacques Cartier Bridge, which is also owned by the federal government, is 78 years old. The Mercier Bridge will turn 75 next year.
There has been little talk of replacing either one.
A report commissioned recently by the Crown corporation responsible for the Champlain Bridge found, remarkably, that it was not designed to withstand corrosion caused by salt.
When officials began salting the bridge not long after it was completed, it "suffered some significant deterioration of the concrete and steel which comprise the bridge."
Lebel said the next step in constructing a new bridge was to conduct an environmental study jointly with the Quebec government.