DPU rejects criticism from Healey, enviros, power generators
THE MASSACHUSETTS DEPARTMENT OF PUBLIC UTILITIES on Tuesday approved massive hydro-electricity contracts between the state’s three utilities and Hydro-Quebec, rejecting arguments from a broad range of skeptics questioning the environmental benefits of the deal.
The hydro-electricity will be produced in Quebec and shipped across the border into Maine, where a transmission line built by Central Maine Power will carry it to Lewiston, Maine, where it will feed into the New England power grid.
The power is firm (meaning it will run reliably and constantly all year long), large (the equivalent of 1,000 megawatts of capacity), and relatively cheap (5.9 cents a kilowatt hour versus the Vineyard Wind offshore wind contract price of 6.5 cents a kilowatt hour). The project is a perfect replacement for the many power plants retiring over the next few years across the region. Pilgrim Station in Plymouth, which closed at the end of May, had a generating capacity of 690 megawatts.
But the decision to approve the contracts was not without controversy. A wide spectrum of diverse critics, from Attorney General Maura Healey to the New England Power Generators Association, criticized the contracts for not guaranteeing that the hydro-electricity delivered into New England will represent net new power delivering an actual reduction in greenhouse gas emissions across the region.Critics said the power being delivered by Hydro-Quebec will come from dams that are already operating, so the deal with the Massachusetts utilities won’t actually result in a net reduction in greenhouse gas emissions. Much of the DPU’s 153-page decision focused on how to measure whether Hydro-Quebec is upping hydro-electricity production or just shipping electricity in a new direction.
Healey claimed that contracts negotiated by Eversource Energy and Unitil could allow Hydro-Quebec to decrease its overall electricity imports into New England relative to the historical average and still comply with the terms of the deal.
“The order entirely side-steps the requirement that this contract be incremental to historical deliveries by Hydro Quebec into New England,” said Dan Dolan, the president of the New England Power Generators Association. “That means that any hopes that this would help reduce greenhouse gas emissions will be little more than an accounting trick.”
Baker administration officials steered clear of the broader emissions debate, and focused on the procurement of clean energy that will technically lower emissions in Massachusetts (on paper) and buttress the reliability of the power grid.
As part of its decision, the DPU authorized the three utilities to collect 2.75 percent of the 20-year contract’s value as remuneration. The DPU took a similar stance in approving utility contracts with Vineyard Wind.
As currently envisioned, the power from Canada is scheduled to start flowing into Maine in December 2022. The project now has its financing in place, but it still requires a series of regulatory approvals from Maine environmental and land use agencies as well as the Army Corps of Engineers and President Trump.