More than 30 years ago, in January 1988, Robert Bourassa announced the signing of an agreement in principle between Hydro-Québec and New York State for the sale and export of 1000 megawatts of electricity for a period of more than 20 years, a contract of more than 17 billion.
For protectionist reasons on the part of local energy producers and social acceptability – in particular the dispute with the James Bay Crees – the agreement never materialized.
The election of a new Democratic president has nothing to do with the improved prospects for Hydro-Quebec’s expansion in the United States, it is rather the firm commitment of Governor Andrew Cuomo to “decarbonize” New York State’s economy which opens up horizons for our Crown corporation.
Last week, New York State officially called for tenders for three renewable energy transmission line projects, including a line that would link the U.S. state’s grid to that of Hydro. -Quebec.
HUGO-SÉBASTIEN AUBERT PHOTO, PRESS ARCHIVES
New York State wants to link its local electricity grid to that of Hydro-Quebec.
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This neighboring state adopted strict environmental laws a few years ago which stipulate that the electricity used on its territory must be 70% renewable by 2030. The objective is to eliminate as much fossil fuel as possible to meet its internal needs.
To achieve its goals, New York State wants to increase the use of wind and solar energy, but has also accepted hydropower as a source of renewable energy. The Quebec manufacturer of wind turbines Marmen announced last week that it was going to set up a tower assembly plant. offshore in Albany to satisfy the ambitions of the state.
Until the wind energy parks that we want to set up off the coasts of the Atlantic become significantly contributory in the energy balance of New York State, hydropower has a clear advantage. more interesting and immediate.
Especially for New York City, which over 70% depends on fossil fuels to meet its electricity needs. With the upcoming closure of the Indian Point nuclear power plant, the megalopolis’ needs for clean electricity will become even more pressing.
Such an American dream
We remember that almost two years ago, the mayor of New York, Bill de Blasio, appealed to Hydro-Quebec by affirming that he wanted to conclude a long-term supply agreement with the Quebec producer of ‘clean energy.
The call for tenders that the State has just launched will therefore enable the mayor of the largest American city to realize his dream of 100% decarbonising his electricity needs. According to the New York State Utilities Commission, the tender is due to be closed by Feb. 16, and final results will be known in the third quarter of the year.
PHOTO BEBETO MATTHEWS, ARCHIVES ASSOCIATED PRESS
New York City Mayor Bill de Blasio would like to see his city use 100% renewable energy.
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Over the past two years, the Quebec delegation in New York has worked tirelessly, together with Hydro-Quebec, to convince all the major players of the reliability and credibility of hydroelectricity as a source of renewable energy.
With its abundant surpluses, Hydro-Québec has ample capacity to meet the demand of New York State.
The state-owned company is already associated with the US group Transmission Developers, a division of the Blackstone investment group, in a partnership to build the Champlain Hudson Power Express Line.
This transmission line will be able to deliver up to 1,200 megawatts of electricity and its cables will be buried over most of the United States, particularly in Lake Champlain and the Hudson River.
Hydro-Québec already sells electricity to New York State, but mainly on the spot market (free market). It will therefore be a contract for the firm sale of electricity to this populous state. The state-owned company has already signed a firm sale agreement for electricity with Vermont and has entered into a new firm sale agreement with Massachusetts, similar to the one it wants to do with New York.
“The difference between a firm sale contract and a spot sale contract is that the price difference is significant. When I sell in the spot market, the market does not recognize the environmental attributes of hydropower, I am selling for the same price as any type of fossil fuel.
“When you make a firm sale, it’s because you want to pay for clean and renewable energy,” explains Dave Rhéaume, senior director, development, strategies and commercial relations outside Quebec. Casually, Hydro will be able to get 60% more for its firm export sales than it receives from current sales on the spot market.
Unlike Keystone XL, which lost the presidential permit on Wednesday that allowed it to continue construction work on its pipeline to link Alberta to Texas, Hydro-Québec is not at risk of losing the presidential permit it already has in its pocket. , since the new Democratic president also wants to decarbonize the American energy sector. It is a great predictability that presents itself for our crown corporation.
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