The $ 10 billion question for Hydro-Quebec

La Presse

(NOTE: Translated to English using Google Translate.)

Electricity sales expected to gross $ 10 billion over 20 years are linked to the construction of a transmission line across Maine to supply consumers in Boston.

Whether or not this new interconnection will be built is the first of three issues on the menu for Tuesday's referendum in the state of 1.3 million people. The other two issues relate to a bond loan and the possibility of amending the Constitution to include the right of everyone to grow and grow food.

The question that will seal the fate of the project known as NECEC (New England Clean Energy Connect) is by far the most expensive to debate in Maine's history. In particular, it asks citizens to ban all construction of high voltage lines in the territory, retroactively to 2020 (see capsule). Political action committees formed as required by law to defend their position have spent nearly US $ 100 million.
The Yes clan brings together those who want to prevent the project. It brings together businesses, politicians and environmentalists who believe that Maine’s energy should be produced locally. Environmentalists forged unnatural alliances with natural gas-fired power plant owners and competitors of Hydro-Quebec Calpine, Nexterra Energy and Vistra Energy, who funded their campaign. Opponents spent over US $ 26 million on the referendum campaign.
Hydro-Quebec and its American partner Central Maine Power (CMP), on the No side, spent almost three times as much, or US $ 67.8 million, according to official figures.

According to Hydro-Québec, these figures do not reflect reality.

"We believe the undisclosed expenses [by opponents] are considerable," said Lynn St-Laurent, spokesperson for the crown corporation.
"The expenses of some opponents remain unknown," she says. The Stop the Corridor group, in particular, refused to open their books despite insistence from the Maine Ethics Commission."
The interconnection project sparked fierce debates in which around ten elected officials opposed the interconnection project took part. Some have tried, unsuccessfully, to prevent Hydro-Quebec from participating in the referendum campaign, because it is owned by a "foreign government" 

Elected officials also oppose a project that serves the interests of another state, Massachusetts. “We are not an extension cord for Massachusetts,” Republican Rep. Jennifer Poirier summed up in a letter published in local media. “The CMP corridor is a bad project for Maine."

Supporters of the project, however, are Joe Biden’s government energy secretary Jennifer Granholm, who has urged the citizens of Maine to say no to the issue before them. "The project will bring clean energy to New England and reduce emissions equivalent to taking out 700,000 cars," she said at the very end of the referendum campaign.
Uncertain outcome

The Massachusetts contract is one of the two largest export contracts in Hydro-Quebec's history, along with that of New York State announced more recently.
To get its project accepted by the people of Maine, Hydro-Quebec and its partner upgraded it, so that part of the available electricity was made available to the state at a reduced price.

Profits totaling US $ 258 million were put on the table, in the form of aid to extend the telecommunications network and finance a network of charging stations for electric vehicles.

This is the second time that the transmission line project has faced a referendum. Opponents' first attempt to submit the project to public consultation was abandoned because they demanded that the permits duly granted to developers by legitimate American institutions be withdrawn, which was deemed unconstitutional.

After this unsuccessful first attempt, opponents managed to force another referendum on the interconnection project. Calpine, a Texas-based energy producer in which the Canada Pension Plan Investment Board is a shareholder, and Hydro-Quebec’s other competitors funded the collection of signatures needed to hold the consultation.
 
Despite the sword of Damocles that the popular consultation weighs on the project, construction work has started and is going well on part of the 233 km (145 miles) route between the Quebec border and the town of Lewiston, in Maine, where the line will connect to the New England network.

The construction of the link at a cost of $ 1 billion was able to begin because the project had received all the necessary authorizations and permits, ten in total. A section less than a mile long is also subject to court challenge.
A Yes victory could be the final blow to Hydro-Quebec’s contract, which was its largest before the recent announcement of a similar deal with New York State.

A few hours before the vote, the results are still impossible to predict. The two options are neck and neck, according to polls published in the local press.

In the event of a defeat, "Hydro-Quebec will take the time to assess the result of the referendum and determine the options for the continuation of the project," said its spokesperson.

As the results are shaping up to be tight, a recount of the votes cannot be ruled out.
 
The interconnection through Maine was already Plan B of Hydro-Quebec, which had earlier failed to get New Hampshire to accept a transmission line to Boston. This project known as the Northern Pass was abandoned in 2018, and Hydro-Québec wrote off the expenses related to this project, which amounted to 46 million.

The commissioning of the interconnection to Massachusetts, originally scheduled for 2020, has been postponed until fall 2022.
Hydro-Quebec says it has no back-up plan, if the yes wins. "The NECEC project has successfully passed all the required regulatory steps and thus represents the best option, both economically and environmentally, to meet the requirements of the contract that finances this infrastructure," said the state-owned company.

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  • Sandra Howard
    published this page in News 2021-11-02 05:26:25 -0400