Quebec’s decarbonization of New York state
Hydro-Québec’s Champlain Hudson Power Express (CHPE) project, with its American partner Transmission Developers, has been selected by the State of New York to provide the state with a significant amount of clean energy for the next quarter century. This historic partnership will allow Quebec’s public utility to be at the centre of the biggest energy transition project in North America.
The Champlain Hudson Power Express Project (CHPE)
On 20 September 2021, after years of negotiations, the State of New York finally chose Hydro-Québec’s CHPE for the delivery of hydroelectricity, a clean and renewable energy. Hydro-Québec is one of largest producers of hydroelectricity in Canada and this deal is the biggest electricity export contract in its history.
Quebec’s public utility will supply 10.4 terawatt hours of electricity to New York state starting in 2025 and continuing for 25 years and could provide for the electricity consumption of more than one million homes. This major export contract would significantly reduce greenhouse gas (GHG) emissions in a context where New York state’s decarbonization plan is aiming for 70% of its energy to be produced by renewables by 2030.
The CHPE project involves the construction of approximately 545 kilometers of underground and sub-riverine transmission lines between the Canada/US border and New York state. The Quebec public utility company has partnered with Transmission Developers Inc. to develop the CHPE project. The 60 kilometres Quebec section will be built in partnership with the Indigenous community of Kahnawake, which will co-own 10% to 20% of the project and will benefit from the economic spin-offs for a 40-year period.
Hydro-Québec’s clean energy gains ground in the US market
While the supply of clean, renewable electricity to New York state by Quebec is not new, this cooperation has historically been limited to energy sales on the spot market. These transactions have been based on auction mechanisms during the consumption point periods. The advantage for Hydro-Québec of a firm export contract is that it can monetize its surpluses over a long period at a stable and higher price. And New York will benefit from a clean, renewable, secure and reliable link to the Quebec hydroelectric market.
With the significant potential of its huge reservoirs and hydroelectric dams, Hydro-Québec, in the current climate crisis, is becoming a major strategic partner for New York state in its search to decarbonize. New York has taken several concrete measures to make this contract possible, including the recognition by New York authorities on 16 October 2020 that all forms of hydroelectricity, including Quebec’s, are clean and renewable sources of energy that can help the state with GHG reduction.
While Hydro-Québec is only able to deliver electricity to upstate New York, this contract represents a symbolic development partnership for the Quebec public utility company. Quebec is well on the way to becoming ‘the battery of the Northeast United States’.
However, the contract will have to be negotiated and submitted to the New York Public Service Commission (PSC) for review and approval. Moreover, the project completion will require all necessary licences and approvals to supply green electricity.
 Prime minister François Legault pitches Quebec as ‘battery of North America’