The relaunch of negotiations with New York City could bring big returns for Hydro-Quebec, including a potential contract for the sale of electricity of $ 10 billion over 20 years.
“We are now moving from a stage of discussion to that of negotiation,” said yesterday to the Journal a spokesperson for Hydro-Québec, Lynn St-Laurent.
It must be said that New York and Hydro-Quebec had already discussed in the past a large so-called long-term supply contract without however being able to come to an agreement.
On Monday, the mayor of New York, Bill de Blasio, unveiled an ambitious green plan in several parts, which includes the construction of a power line to connect his city to the Hydro-Quebec network.
“Negotiations will begin immediately, with the aim of signing an agreement by the end of 2020 and to fully supply the City’s facilities with renewable sources within five years,” summarizes the City’s New Green Accord. of New York disclosed by Mayor de Blasio.
- LISTEN to the interview on QUB radio with Jonatan Julien, Minister of Energy and Natural Resources and Member of Parliament for the riding of Charlesbourg:
The project with New York (which could take effect in 2025) would consist of the construction of a transmission line of nearly 1,100 megawatts (MW) in the state of New York. The construction cost is estimated at more than 2.5 billion Canadian dollars.
Hydro-Québec will also have to build a high voltage line from Hertel substation in Estrie to the United States. A project estimated at more than 500 million dollars.
The final supply contract (nearly 9 terawatt-hours) with Hydro-Quebec could bring up to $ 10 billion in its coffers over 20 years.
This is roughly the same amount that Hydro-Quebec will receive for its contract signed with Massachusetts last year (9.45 terawatt-hours). The State of New England will pay an average of 6.6 US cents (8.8 CA cents) per kilowatt hour for Quebec electricity.
A line under Lake Champlain
The contract with New York could materialize quickly. The Champlain Hudson Power Express (CHPE) high-voltage line project has already obtained all authorizations in the United States to proceed.
The cables of this line would be buried, underground and under water, over a distance of more than 570 kilometers in American territory.
The export of electricity to New York would be carried out using the future Champlain Hudson Power Express line.
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“This is very good news for Hydro-Quebec, which has significant energy surpluses,” said University of Ottawa energy professor Jean-Thomas Bernard.
Due to a surplus not to know what to do with, last year Hydro-Quebec discharged the equivalent of 10 terawatt-hours (TWh) of water from its dams across Quebec.
A new dam
The Minister of Energy, Jonatan Julien, yesterday evoked a scenario in which the government could lean towards the realization of “new major projects” for Hydro-Quebec.
“We think that for these two contracts [avec la ville de New York et le Massachusetts], a good part of the surplus would be assumed. I think that in 2021-2022, we will have, with Hydro-Quebec, to look in terms of development what is in front of us in order to deal with the eventuality that our surpluses are all used up, ”he explained. .
With this contract, Hydro-Québec could generate up to 16% of the electricity consumed by New York City while reducing its greenhouse gas (GHG) emissions by 5%.
Other Hydro-Québec contracts in the United States
Contract with Vermont
- Duration: 26 years
- Start of contract: 2012
- Power : 225 megawatts (MW)
- Price: 4.5 cents per kilowatt hour
Massachusetts contract
- Duration: 20 years
- Start of contract: 2022
- Power : 1100 megawatts (MW)
- Price: 6.6 US cents (8.8 CA cents) per kilowatt hour
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