Major. Huge. Gigantic. This is how we can qualify the effects of Hydro-Quebec’s recent agreements with the Americans, particularly with New York State. Not only will Hydro pocket billions of dollars, but the agreements will massively reduce greenhouse gases (GHGs) in the northeast of the continent. Hallelujah!
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To fully understand, one must speak in relative terms. The contract with Massachusetts in 2018 and now the one with New York – details of which are being negotiated – will save 6.9 million tonnes of GHGs (3.0 million and 3.9 million respectively).
This is the equivalent of 80% of the GHGs emitted by all domestic air transport in Canada. 63% of all emissions from the province of Newfoundland and Labrador. Or nearly 40% of all GHGs propelled into the air by Quebecers’ cars and light trucks!
Gigantic, that I tell you. In comparison, all of the 114,000 electric vehicles running in Quebec save about 0.5 tonnes of GHGs, or the equivalent of 7% of Hydro-Quebec agreements. The two REMs in the West and the East? About 0.09 tonnes, or 1.3% of agreements with the Americans …
Of course, these saved GHGs will not improve Quebec’s environmental footprint, but rather those of New York and Massachusetts. All the same, it is our resources, developed over the years, which allow us to help the fate of the planet.
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Yes, but are these really GHG savings? Doesn’t Hydro-Québec already sell surpluses to these two customers on the short-term (spot) market? And consequently, won’t the two 20-year and 25-year long-term contracts simply replace short-term sales?
No, Hydro-Quebec replies. Our hydroelectricity will really replace the fossil fuels of these customers to meet their needs.
Our surpluses currently sold in the short term are mainly sold in regions, such as upstate New York, which drink in green energies (wind and solar). The new transmission lines of the two contracts will allow our energy to go further south, such as to New York City, which is mainly powered by fossil fuels.
This explains why, for the Massachusetts contract, for example, the challenges come in particular from the fossil energy companies Calpine, Vistra and NextEra, which are losing significant revenues. And we can think that there will be a similar opposition for the New York contract.
Yes, but will we have enough surplus to fuel all of this? Absolutely, according to Hydro-Quebec.
Currently, our Crown corporation has about 42 terawatt-hours (TWh) of surplus, while the two US contracts total nearly 20 TWh. (1). In short, there will be around 22 TWh of space available for other needs.
Admittedly, these 22 TWh of surplus would no longer be sufficient to allow Hydro to continue selling 32 TWh on the short-term markets, as it currently does. Nor to meet the growing needs of Quebec in the medium term, in particular for the electrification of transport.
But it should be noted that Hydro plans to add around 10 TWh of energy to its network in the medium term with its recent calls for tenders and its energy efficiency measures. In addition, it hopes to gain 8 TWh of efficiency gains from the current repairs to the James Bay power plants.
In short, all things considered, Hydro-Québec considers that it has enough energy for its future needs. “In the long term, we cannot rule out new hydroelectric power station projects, given the advantages of this energy, such as availability on demand, and its essential role in reducing GHGs”, Serge Abergel, spokesperson told me. from Hydro-Quebec.
Yes, but will Hydro customers foot the bill, eventually, with an inherent rise in their rates? At the moment, the cost of the surplus lying dormant in our reservoirs is almost zero, because the energy is unused. The profits from their sales are therefore very high.
Large hydropower projects – rather remote – could possibly push up the bill, but in the medium term, the new TWh available (wind power and efficiency) are rather cheap.
Some, like economist Pierre-Olivier Pineau, believe that Quebec could save much more energy, especially for its homes, with better coordination of efforts between Hydro-Quebec and the Ministry of Energy and Natural Resources.
This saved clean energy could be sold back to Americans, he argues. According to the professor from HEC Montreal, the Quebec-New York transmission lines should reach 4,000 megawatts, at least three times those of the contract under negotiation (1,250 megawatts).
A great project in perspective for Quebec …
1– The contract with Massachusetts will absorb 9.45 TWh from 2023 and that with New York, 10.4 TWh from 2025.
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