Why Is Hydro-Québec So Intent on Overselling Its Hydropower?, Part III

Christophe Courchesne

With the stresses that winter places on New England’s electric grid right around the corner, it’s a good time to revisit a crucial issue with increasing our reliance on hydropower imports from Canada—their reliability.

The cause for concern? Last January, a very cold month, Hydro-Québec chose to curtail its exports to New England 24 times, often during times of the day when power needs were spiking on both sides of the border and New England natural gas power plants had difficulty running at full capacity. That’s why the number 24 made my list of three ugly numbers behind the push for more hydropower imports.

As with the numbers on new hydropower costs and pollution, Hydro-Québec cried foul in a press release, calling CLF’s information “erroneous.” In this post, the last in a series of three, I will break down what Hydro-Québec’s defense of its product gets wrong—on the reliability benefits of new hydropower imports.

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In its press release, Hydro-Québec acknowledges CLF’s broader concern and then offers its own statistic, which may be true but by no means contradicts CLF’s number:

In Québec, electricity consumption peaks during winter months, while in New England, it peaks during the summer months. In this regard it is true that Hydro-Québec will likely deliver higher quantities of energy to New England in the summer than in the winter.  This does not mean, however, that on most winter days Hydro-Québec cannot deliver power to New England. In fact, just this past year, from December 23 to January 4, when Québec experienced very high consumption due to cold temperatures, Hydro-Québec was continuously exporting over 2100 megawatts for 90% of the period, even though it has no contractual obligations to do so. Significant energy exports are available from Hydro-Québec in winter and more are coming online in the next several years. The New England region is wise to seek ways to evaluate, and, if beneficial, secure these exports to contribute to its growing winter reliability problems and system needs.

Once again, Hydro-Québec puts words in my mouth: no one is claiming that “on most winter days Hydro-Québec cannot deliver power to New England.” Indeed, power was flowing south to New England over the Phase I/II tie throughout January 2014.

The problem is that the lines weren’t even close to full, not once reaching their physical capacity. This is in part because, for reasons I’ve discussed before, the New England grid limits the amount of power that can be imported. But on those 24 occasions we identified, Hydro-Québec’s exports dropped to levels that make clear that Hydro-Québec chose to curtail the amount of energy it was sending south. (There were, however, several times when Hydro-Québec oddly stopped exporting power to Vermont over the Highgate tie, despite Vermont’s long-term contract with Hydro-Québec for continuous imports.) Hydro-Québec does not dispute these facts.

In its press release, Hydro-Québec cites high levels of exports during a different period—December 23, 2013, to January 4, 2014—as indicative of its winter capabilities. (Notably, Hydro-Québec misleadingly seems to be citing its performance exporting to anywhere outside Québec, not solely to New England.) It then touts the fact that it was under no “contractual obligations” to deliver these exports, as if they were a good will gesture. To the contrary, these exports to New England alone likely made Hydro-Québec tens of millions of dollars in profits because wholesale electric market prices south of the border were unusually high. Indeed, Hydro-Québec capitalized on high New England prices throughout the winter, and its profits from exports soared in the first quarter of 2014. The fact that Hydro-Québec had to curtail its exports so many times in January 2014—and leave so much money on the table—suggests very real supply constraints during the coldest days of winter.

The key reason for these constraints won’t be readily fixed by Hydro-Québec’s ongoing development of massive new dams—it’s because most Québecers heat their homes and businesses with wildly inefficient baseboard electric heat. During last winter’s coldest weather, Hydro-Québec was forced to call for emergency energy conservation by its customers on a number of occasions, something New England’s grid operator didn’t do once.

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ISO-NE presentation at Raab Roundtable, September 19, 2014

Peak electric demands in Québec mean that new imports from Hydro-Québec through the Northern Pass transmission project or otherwise aren’t necessarily a cure for the winter peak challenges that can affect the reliability of New England’s electric system. And you don’t need to make my word for it: grid operator ISO-NE has said much the same thing.

And there are other reasons to scrutinize the reliability of imports. Because Hydro-Québec runs its own independent electric grid, New England has less short-term control than it would like over ensuring that big flows of imports can be counted on in any given hour. For example, on December 14, 2013, a cold Saturday evening, Hydro-Québec unexpectedly curtailed exports to New England because Québec demand was higher than forecast. As a result, New England faced a “capacity deficiency” event, and several oil power plants were turned on, on short notice, to maintain system reliability. Longer-term risks—like shifts in Hydro-Québec’s strategy and capabilities or in the political dynamics of a foreign country—are important considerations, too.

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Unfortunately, Hydro-Québec’s attempts to gloss over its constraints are of a piece with the misleading sales pitches by Northern Pass’s developer over the past four years. If New England is going to get new imports right, as CLF has long said we should, we need honest information. This pattern of overselling Canadian hydropower’s benefits and dodging its limitations shouldn’t fool anyone; instead, the tactics undermine confidence in Hydro-Québec as a trading partner. A real dialogue with our Canadian neighbors about how we can work together to meet our respective energy needs and the climate imperative should begin with transparency and facts, not hype and talking points.

In the end, New England will need more than accurate numbers. Despite the obfuscations, it remains plausible that additional imports from Hydro-Québec (and/or other Canadian hydropower suppliers) could be a significant and important part of New England’s clean energy future; they could help reduce carbon emissions and our use of fossil fuels; they could complement the deployment of zero-carbon energy sources here in New England; they could help affordably diversify our energy portfolio against price volatility and reliability risks.

But proponents of new imports like Hydro-Québec and Northeast Utilities have pretended that all these “could”s are inevitably “will”s. They have not made the essential switch from repeating gauzy generalities to offering hard, verifiable commitments.

Some constructive possible agreements: to replace our region’s dirtiest power plants, like Northern Pass affiliate PSNH’s coal plants in New Hampshire; to facilitate and invest in our own booming renewable energy and efficiency sectors; to achieve real emissions reductions using scientifically sound accounting; to guarantee power delivery at affordable rates at the times of the year when we need it most; and to build advanced transmission lines with minimal impacts on the environment and host communities.

Before New England embarks on long-term power purchases or decides to site or fund costly transmission projects to increase hydropower imports from Canada, we need good faith, specific offers that lay out the terms of what we’d get. Only then can we have a reasoned and well-informed debate on the role of new imports in our region’s energy future.

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One Response to “Why Is Hydro-Québec So Intent on Overselling Its Hydropower?, Part III”

  1. Ivan Quinchia

    The real reason Hydro Quebec is pushing so hard is purely economical as an over abundance og hydro power is available during the summer months and the gap it it’s working to fill is the one created by Vt Yankee, Somerset, Salem etc..
    Only a small minority uses straight talk when talking about energy renewable or otherwise. Efficiencies of delivery, reliability, need, carbon numbers, demand etc.. Are all lied about and data manipulated in a way that on the surface it looks truthfull.
    Wind companies will not share the data on when wind delivers and exactly how much evnthough the data is there all to support their real reason for investment in the technology at the expense of tax payers and rate payers.
    This kind of manipulation is what created a mistrust and a backlash towards all energy producers and the manipulation lies at the federal and state leves as well.
    Look at the numbers of jobs that Massachusetts is claiming were created by renewable technologies. Within these numbers they include 200,000 jobs in the heating and air conditioning field and nothing could be further from the truth. A piece of heating or cooling equipment has to be installed in a new home or in a renovation, high efficiency or not and that does not add any jobs.

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