The electricity sales contract with Massachusetts would bring in revenue of 10 billion over 20 years for Hydro-Québec.
Hydro-Quebec's plan to deliver power to New York state won't face the same hurdles as the tie line in Maine, the government believes. chief operating officer of the US subsidiary of the state corporation, Serge Abergel.
One reason is that New York State does not have a referendum process that can challenge a bill, as it does in Maine, explains the leader of Hydro-Quebec Energy Services in an interview, on the sidelines of a presentation at the Conference of Montreal, Tuesday.
He also points out that the New York project has all the necessary permits to carry out the construction, which would allow commissioning in 2025.
Mr. Abergel does not cry victory for all that for this contract which could generate revenues of 20 billion dollars over 25 years and supply the equivalent of a million homes with electricity. I have fears for all the projects, he admits.
“I want to be clear, it's not because there is a specific threat, but it's our job to be proactive. We take nothing for granted.
— Serge Abergel, Head of Hydro-Quebec Energy Services
The Hydro-Québec project also enjoys strong support from communities who are suffering the effects of air pollution linked to the production of fossil fuels that the State of New York wants to replace with clean sources of supply, says Abergel.
He gave the example of auxiliary thermal power plants around New York City. The air pollution they produce particularly affects the Queens borough in the south of Manhattan Island. The population has given the name of asthma corridor to certain disadvantaged areas.
It is the place in the United States with the highest rate of asthma due to local air pollution, Abergel said during his presentation. People have mobilized and said they are tired of this environmental discrimination.
Serge Abergel, Chief Operating Officer of the American subsidiary at Hydro-Québec
The situation is more uncertain for the Maine tie line project. The 336 kilometer project that would cross Quebec and the United States to bring electricity to Massachusetts was rejected by 59% by the citizens of Maine in a referendum last November. /p>
The future of the project is in the hands of the Supreme Court of Maine which will have to determine if the result of the referendum is unconstitutional, as claimed by Hydro-Québec and its partners. Until then, work is suspended.
The Supreme Court of Maine must also decide another determining cause for the project. Permits for a portion of the 1.6 kilometer line are also in dispute. A Maine Superior Court judge struck down the permits in question granted by the government in 2014. The judgment is under appeal.
Hydro-Québec anticipates a judgment by the end of July for the two cases, which would probably be rendered at the same time. Mr. Abergel says he is hopeful of winning the case.
“We will let the Court make its decision, but we remain convinced that a project that has obtained its permits with four years of process deserves to move forward. »
—Serge Abergel, Head of Hydro-Quebec Energy Services
Hydro-Québec's partner in Maine, NECEC, has already spent nearly US$450 million, or 43% of anticipated costs, according to court filings. If the project were to be abandoned, Hydro-Québec estimates, for its part, that it will have to record a charge of $536 million in its results, according to its annual report.
The power sales contract with Massachusetts would bring in $10 billion in revenue over 20 years for Hydro-Quebec. It would reduce greenhouse gases by 3 million metric tons, the equivalent of taking 700,000 cars off the road.
Pending of the judgment, the state-owned company has not identified an alternative solution to carry out its export project to Massachusetts. Doing another route would require another Massachusetts bidding process, in Mr. Abergel's understanding. There is no flexibility to recycle this tender to have another project.