Jan 16, 2023
IT’S BEEN 3 ½ YEARS since Massachusetts utilities negotiated a massive power purchase agreement with Hydro-Quebec, and the electricity still isn’t close to flowing because of repeated delays in building a transmission line from the Canadian border down through Maine.
Hydro-Quebec officials say they are ready to deliver the power as soon as the transmission line is completed, but an upcoming change in administration at the Quebec-owned company and competing interests within the province itself are raising questions about the province’s ability to deliver down the line.
The Massachusetts contract with Hydro-Quebec is crucial to the state’s efforts to tackle climate change. Offshore wind is the homegrown industry grabbing all of the attention, but hydroelectricity from Quebec is the steady, reliable base on which Massachusetts can build a green electricity supply.
The contract with Hydro-Quebec promises a steady stream of electricity that should reduce the need for power generated by fossil fuels. The power comes from a series of 28 dammed reservoirs, and is not subject to daily fluctuations in wind or sunshine.
But getting the power into New England has not been easy. A bid to build a transmission line through New Hampshire failed to gain traction and a proposal in Maine has met strong resistance, including from a law passed by voters, but now the project appears headed toward approval after several key comeback victories in the courts.
Now concerns are surfacing north of the border. Sophie Brochu, the president and CEO of Hydro-Quebec, announced last week she would be stepping down on April 11 after serving three years of a five-year term. She said it was time for her to move on, but there was widespread speculation in the Canadian press that her decision reflected tension between her and the provincial government led by Francois Legault about the role of electricity in Quebec’s future economic development.
For decades, Hydro-Quebec has produced far more electricity than it needs at very low cost. Residents enjoyed low electricity rates (five times lower than Boston in 2022), as did many energy-intensive businesses.
But those days may be coming to an end. A strategic plan released by Brochu last year indicates the years of surplus are coming to an end. Quebec is dealing with climate change the same way Massachusetts is, by shifting its transportation and housing sectors from reliance on fossil fuels to reliance on clean electricity. That will require a lot more electricity – and the power won’t be as cheap as in the past.
“While we’ve been able to rely on an abundance of available energy in recent years, an upswing in demand for our green electricity will tighten our balances,” the strategic plan says. “As a result, our priorities will shift from selling large quantities of energy [both within Quebec and abroad] to helping Quebecers become more energy efficient and maximizing the value of our energy by targeting the most promising uses.”
Legault has tightened his grip on Hydro-Quebec and has raised the possibility of using lower-cost electricity to attract new industries to the province. Brochu has raised some concerns about that approach.
“I don’t want to become the Dollarama” of utilities, Brochu told the Toronto Globe and Mail in October. “Let’s say an industrial company in Quebec develops a new technology and they’re able to mount a demonstration project out of it and that it creates new jobs and that it’s extraordinary. If the government decides to give them a discount on power, that’s not dumb. But if we systematically offer an inexpensive industrial rate to attract everybody, that’s a disaster because that puts undue pressure on the rates paid by all the others.”
Hydro-Quebec’s strategic plan projects a need for new energy supplies in 2027, and says the price of that new power (hydro, wind, and solar) will be roughly 11 cents a kilowatt hour, well above the 3-cent-a-kilowatt-hour-cost of its legacy hydro power.
Lynn St-Laurent, a spokeswoman for the company, said the tightening of balances referenced in the strategic plan comes with the inclusion of the electricity Hydro-Quebec will supply under its 20-year power contract with Massachusetts and a 25-year contract negotiated last year with New York.
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FYI : The current assessed price to Maine ratepayers for C02 emissions is $12.99 per ton for a 2022 total of 1,992,315 tons times $12.99 = $25,880,172.00 ( Note 2022 C02 figures are incomplete as of today)
The data is in. Below is the RGGI recorded C02 emissions from Maine Fossil Fueled Plants from 2015 to 2022.
Notice the trend from 2015 t0 2019 was reducing emissions, but a drastic increase occurred from 2019 to 2022
Our CO2 emissions is influenced by plant retirements outside our borders, but within the New England regional network of ISO-NE. This is the cause of the rise in C02 in Maine which consequentially causes a rise in electric prices and no way to reach zero carbon and escape the cost of chasing zero carbon. NECEC is part of the solution to reversing the current trend of rising C02 emissions in Maine, plain and simple.
Closing down 60% efficient gas plants would be very unwise.
There will times HQ tells NE and NY, it has no exports available. All is needed in Canada, just as happened to California and Germany
Efficiency Maine Trust recently received $50 million dollars from the Rescue Act. EMT also receives 4% of CMP electric sales, both supply and delivery. That is $37 million dollars and climbs with every rate increase. This is robbery
The great sucking sound of Net Energy Billing, which should go away with zero carbon.
RGGI could go away, Purchasing of Renewable Energy Credits could go away. Long Term Renewable Energy Contracts could go away. Ratepayers are up to their necks in paying for the chase for zero carbon. 6 NG and oil-fired plant closures in Maine is all that stands in the way.
That is a good explanation.
But, from a practical point, the impact on the NE wholesale electricity price will be minimal; like taking a pee in the lake.
If the DC to AC station is two-way, then the line can be used for balancing the MA offshore wind. Still more lines would be needed for that purpose.
The NECEC is a 1200 MW HVDC line that terminates in Lewiston, Maine where it is converted to AC power. It becomes a source of electricity that competes with the rest of the pool resources feeding the ISO-NE network. Like wind and solar, it will bump out production of natural gas and oil-fired plants, since they are the most expensive and most likely to be the marginal fuel at any given moment.. Unlike wind and solar, it will bump out up to 1200MW of NG and Oil and wind and solar.
The ISO-NE selection of resources to use for the day is guided by the principles of competition. Lower priced resources are favored over higher priced resources. This is recorded as the LMP (Locational Marginal Pricing) . Resources are selected by price offers, congestion potential and line loss due to distance from resource.
NECEC production entering Lewiston will have an impact on natural gas-fired plants in Maine (the Locational term in LMP) . Calpine, the owner of the largest NG plant in Maine (Westbrook) knows this and fought NECEC throughout the PUC deliberations and paid to get the people's referendum in place.
Massachusetts receives greenhouse gas reduction credit to apply to their goals. Massachusetts' contract to purchase NECEC output will lower wholesale costs for everyone in the ISO-NE network. Maine does not recognize hydro power over 100MW as a renewable resource, but the Maine sited natural gas and oil-fired production it will displace can easily help Maine attain its carbon reduction goals in the electric sector, allowing the repeal of the costly renewable energy laws.
The NECEC is a 1200 MW HV DC line from Canada to Massachusetts, only very little of that power would stay in Maine
Massachusetts wants this line to balance its VERY EXPENSIVE OFFSHORE wind power, instead of using existing 60% efficient gas plant.
But it will need much more than a 1200 MW line, at least 5000 MW of lines, as the offshore wind systems come on line over the next 15 to 20 years
I absolutely agree with you, Willem. Unfortunately, scientific evidence is not used as a guide by the misfits of government, the media and environmental organizations. Maine could so easily become a carbon zero state in electrical generation and stop the raid on ratepayer money to chase renewables at a never-ending snail's pace by just approving the NECEC project and a couple other changes.
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