In a recent decision (pdf), the FERC granted preliminary approval to a single transmission line, proposed by Hydro-Quebec, NStar and NE Utilities. The line will be a high-voltage direct current (DC) line, bringing 1,200 MW of hydropower from Canada to the ISO-New England region via a southern New Hampshire tie-in. The project is proposed as a participant-funded project, meaning the proposal does not seek to socialize the costs among the ISO-New England states. Instead, the project will essentially be funded by a long-term contract for the energy it’s designed to transmit.
Canadian officials cheered this decision by the FERC; in their view, this is the first FERC approval of a major long-term contract for Canadian hydropower since the 1980s and marks the first time hydro power has been acknowledged by a federal agency as a clean source of power. Canadian hydropower developers – on both coasts – are cheering these developments, too, concluding that Canadian hydropower will now be a welcome player under the Obama Administration’s energy policy.
But south of the border, several developers of smaller renewable projects in northern New Hampshire claim the Hydro-Quebec transmission project will have a chilling effect. These wind and biomass projects face a host of technical, regulatory and financial hurdles, but they also require transmission upgrades in order to be viable, and interconnection with the Hydro-Quebec line is not an option. The Hydro-Quebec line would be a high-powered direct current line, requiring expensive transformers to change it into alternating current that goes to people’s homes. Developers in New Hampshire worry that the massive Hydro-Quebec line would make improvements to the existing transmission system seem unnecessary to NH officials and ISO-New England, and they can’t afford the upgrades without socializing the costs or receiving financial support from the state.
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