Hydro-Québec is the Best Corporate Citizen 2022 – Corporate Nights Magazine

Hydro-Québec’s ambition is to become the “battery” for renewable-energy-powered grids in northeastern North America, but its first order of business is closer to home: ensuring that the province maintains its economy with clean, reliable and affordable electricity. to decarbonize. ,

The provincial-owned utility is pursuing two of the continent’s biggest decarbonization projects that will supply hydropower to Massachusetts and New York City while displacing natural gas in those markets. In both cases, the transmission projects needed to complete the deals have faced local opposition that could derail Hydro-Québec’s export plans.

It is also participating in talks on a project called the Atlantic Loop. The regional grid would bring in marine hydropower to displace coal-fired electricity and avoid the need for new natural gas plants to supplement the growing supply of wind power.

If all parties can agree, the new transmission lines would flow power south and east from Quebec to provide baseload power and intermittently produce renewable energy. In return, they would allow American and Atlantic Canadian producers of renewable energy to sell to Quebec when there was a surplus of wind power.

However, even with its neighbours, Hydro-Québec faces a major challenge in serving as the linchpin for the province’s ambitious decarbonization plans, resulting in There could be 50% more electricity demand in 2050.

The utility’s original focus was on selling hydroelectric power to Quebecers and keeping rates low for the province’s industrial and residential consumers. While that remains the core mandate, says Hydro-Québec chief executive Sophie Brochu, the corporation is now determined to advance regional cooperation in decarbonization while investing more in energy efficiency, wind power and new, smart grid technology.

Brochu says the “North Star” for all power systems operators and utilities in North America is to provide their customers with a low-carbon energy transition at the lowest cost.
“We have a responsibility, obviously, to serve our respective markets,” she said. “We [also] It is a collective responsibility to see how we can work together with our respective infrastructure and means of production to reach this North Star. ,

For the third year running, Hydro-Québec ranked first among the Best 50 Corporate Nationals of Corporate Knights in Canada. Its ranking was based not only on the low-carbon nature of its massive electricity business, but also on water productivity, taxes paid, CEO-than-average-worker salaries, executive and board gender diversity, and clean revenue.

Brochu itself is a hallmark of both the progress of Hydro-Québec and its deep ties to the province’s business culture. When she took office in 2020, she became the first female CEO of Hydro-Québec. The appointment interrupted the sabbatical period he had planned for when he resigned after serving 12 years as chief executive officer at Montreal-based nergir, formerly Gaz Metro.

keeping house fires clean

In March, Hydro-Québec released its strategic plan for 2022 to 2026. It laid out the challenges ahead and warned that pricing structures would have to be changed to encourage energy efficiency and conservation. In other words, if Hydro-Québec is to succeed in its ambition to become a renewable “battery” for a large part of North America’s northeast, it must prevent Quebec from ruining it, especially during peak hours. I have to raise my rates. lot of power

Between 2020 and 2029, it is projected that Quebec’s demand for clean electricity will increase by 20 terawatt-hours (TWh), or about 10% of current levels. By 2050, decarbonization efforts – which include a dramatic increase in electric vehicles – will result in an increase of 100 TWh, or 50%.

Brochu says they expect to meet 2029 demand through an aggressive energy efficiency program; Renovation of existing hydroelectric facilities; and growth in wind power, including 3,000 MW of capacity provided by a recently announced partnership between Hydro-Québec, Energier and Borealis.

Even with that high demand in Quebec, the utility firm is pursuing deals to increase exports to the United States by about 20 TWh annually under contracts. (By comparison, Nova Scotia’s electricity demand in 2019 was 10 TWh.)

vision extension to the south

American politicians and systems planners – and many power sector analysts – are looking to Quebec to provide relatively low-cost, low-carbon power to help states drive their decarbonization plans. Hydro-Québec is moving forward on two separate deals: the 9.45 TWh New England Clean Energy Connect to serve Massachusetts, and the New York City-bound Champlain Hudson Power Express, with a capacity of 10.5 TWh. The $4.5 billion New York project was approved by state regulators in April, but further legal battles are possible.

A study by the Massachusetts Institute of Technology in 2020 concluded that a reliance on hydropower from Quebec provides the most cost-effective route for decarbonization for northeastern states, especially when combined with a bidirectional trade in which the Canadian province buys additional renewable energy. When production is high but demand is low.

In the long term, Quebec could serve a battery function, recharge its reservoirs when there is a surplus of renewable energy and flow hydroelectricity when intermittent renewables cannot meet demand, authors of the MIT study. Emil Demanchev said in an email.

Brochu says Hydro-Québec is keen to expand the combined benefits of wind and hydro. However, existing agreements with Massachusetts and New York are for a stipulated capacity, which will flow regardless of wind power availability.

Proposals for Quebec to expand electricity exports to Ontario have long failed, as the Hydro-Québec firm seeks to sell capacity and its neighbor seeks more flexible purchases of energy to backstop renewables. The Quebec utility could face better reception in the United States if it “remodels” its New England and New York projects “on the lines of the battery concept by bundling new transmissions with massive renewable expansion in the US”. Yes, Demanchev says.

Opposition to US expansion plans is brewing

Anyway, Hydro-Québec is facing stiff opposition from the large-scale transmission projects needed to complete the US deals.

In Maine, voters rejected a US$1 billion transmission plan to bring power from Quebec in a non-binding referendum last November. Hydro-Québec’s contractor is continuing with some construction as a utility and its allies seeking a court ruling that would allow completion.

Several groups unsuccessfully opposed the New York transmission line buried under the Hudson River. They include environmental group Riverkeeper, which presented a succinct argument that Quebec’s hydropower is not as low-carbon as Hydro-Québec claims and that the utility is disregarding indigenous concerns.

Dams and flooding over large areas can actually cause the release of methane and carbon dioxide as vegetation dies. Hydro-Québec argued that Riverkeeper analysts cherry-pick the data by focusing on near-term impacts, while for the life of the project, its hydropower has one of the lowest carbon intensities in the world.

The riverkeeper submission included statements from a handful of indigenous representatives who complained that Hydro-Québec’s hydropower damaged their traditional territory.

Brochu acknowledges that Hydro-Québec has long had problems acknowledging and addressing indigenous concerns, but says the utility is working to address its flaws.

“Things need to improve, and we are improving them,” she says, while there are many different perspectives within Indigenous communities. Brochu recently attended a ceremony that marked Hydro-Québec’s commitment to bringing electricity to the village of Kitisaquique, the last indigenous community unconnected to the grid. “Powering up Kitsisic is as thrilling as [bring it to] Queens in New York,” she says.

Hydro-Québec is also working with a Mohawk community as partners to invest in a transmission line that crosses its traditional territory on its way to New York. However, Hydro-Québec faces numerous lawsuits and other challenges from indigenous groups, stemming from its long history of damming rivers throughout the province and Labrador, which led to the development of Churchill Falls in the 1960s and 70s. As in dating back.

Indigenous complaints have so far not derailed Hydro-Québec’s export plans.

Energy expert Pierre-Olivier Pino of Montreal’s HEC business school says a rejection of Quebec electricity will only hurt American consumers. At the same time, loss of export sales would mean less supply pressure and lower prices at home, he says.

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