Does Hydro-Québec Sell Electricity To The Us?
Hydro-Québec is one of the largest electric utilities in North America and is responsible for producing and distributing the majority of electricity used in the Canadian province of Québec. While primarily focused on domestic electricity supply, Hydro-Québec also generates revenue through electricity exports to neighboring markets, especially the northeastern United States.
The company has significant hydroelectric generation capacity and has exported electricity to American utilities since the 1960s. While exports fluctuate year-to-year based on market conditions, Hydro-Québec currently sends billions of kilowatt-hours of electricity over interconnections to New York, New England, Ontario, and New Brunswick annually. These growing exports have become an important revenue source but also a point of contention regarding energy policy and Québec’s natural resources.
Hydro-Québec’s Electricity Production Capacity
Hydro-Québec (HQ) is one of the largest electric utilities in North America, with a total electricity generation capacity of over 37,000 megawatts (MW). The vast majority of HQ’s generation comes from hydroelectricity, owing to Québec’s abundant hydropower resources.
Specifically, HQ operates 61 hydroelectric generating stations with a total installed capacity of 36,671 MW. This includes mammoth facilities like the Robert-Bourassa generating station, which alone has a capacity of 5,616 MW. Hydroelectricity makes up over 98% of Hydro-Québec’s total generation portfolio.
Beyond hydro, HQ operates a small number of other electricity generation assets. This includes 7 thermal generating stations fueled by natural gas and diesel, with a combined capacity of 117 MW. HQ also owns and operates 3 wind farms in Québec with installed wind power capacity of 364 MW. Overall, hydroelectricity dominates HQ’s generation mix at over 98%, with thermal and wind making up the remainder.
Electricity Demand in Québec
Québec has seen steady growth in electricity demand over the past decades due to population growth, economic development, and the electrification of various sectors. Total electricity demand in Québec was around 174 TWh in 2021. However, electricity demand fluctuates significantly between seasons.
Winter heating needs drive up electricity demand during the colder months. Québec’s winter peak demand can reach around 40,000 megawatts (MW), with domestic heating accounting for a large share. By comparison, summer demand ranges from 18,000 MW to 25,000 MW. To meet winter peak demand, Hydro-Québec has to utilize its full production capacity, import electricity from neighboring systems, and rely on energy conservation measures by consumers. The seasonal swing in demand is a defining feature of Québec’s electricity landscape.
Hydro-Québec forecasts that electricity demand will continue to grow at around 1% per year over the next decade, driven by data centers, greenhouses, electric vehicles and other new uses of electricity. Managing seasonal fluctuations in demand will remain an ongoing priority.
Transmission Infrastructure
Hydro-Québec has developed a vast high-voltage transmission network to transport electricity from its hydroelectric generating stations to load centers. The transmission system consists of over 34,000 km of lines, including 22,000 km of 735 kV extra-high-voltage lines.
Hydro-Québec’s transmission network is interconnected with the power grids of neighboring systems in Canada and the US. There are several major interconnections between Québec and the US:
- The Radisson-Nicolet-Des Cantons 735 kV line connects to New England via a 1,200 MW HVDC back-to-back converter at the Québec-New England border.
- The Outaouais 735 kV lines connect to Ontario and New York State.
- The Châteauguay and Cadillac 735 kV lines connect to New York State.
- The 450 kV DC transmission line to New England has a capacity of 2,000 MW.
These interconnections allow Hydro-Québec to export large amounts of electricity to neighboring markets. The transmission network continues to be expanded and reinforced to accommodate increasing power transfers.
Electricity Exports to the US
Hydro-Québec first began exporting electricity to neighboring US states in the early 1980s. At the time, Hydro-Québec had built up a large electricity generation capacity through major hydroelectric projects like the La Grande complex completed in the 1970s. Meanwhile, demand within Québec was lower than anticipated. This allowed Hydro-Québec to start selling its surplus electricity to US utilities.
Over the past few decades, electricity exports to the US have steadily grown. In 2000, Hydro-Québec exported over 16 TWh of electricity to the US market. By 2010, this figure grew to more than 30 TWh as Hydro-Québec signed new long-term export contracts. Currently, Hydro-Québec exports more than 20% of its electricity production to neighboring US states.
Some of Hydro-Québec’s major export deals include:
- 1,000 MW contract with Vermont starting in 1986
- 450 MW contract with New York starting in 1990
- 1,200 MW contract with Massachusetts starting in 1986
- 225 MW contract with New Hampshire starting in 1990
These long-term contracts have provided over $10 billion in revenues for Hydro-Québec over the years. Exports to the US continue to make up a significant portion of Hydro-Québec’s electricity sales.
Drivers of Québec’s Electricity Exports
There are several key factors that have enabled Hydro-Québec to generate large surpluses of electricity for export to neighboring US states:
Abundant hydropower resources – Québec benefits from massive hydroelectric potential due to its numerous large rivers and favorable geography. Hydro-Québec operates a network of hydroelectric generating stations and reservoirs that produce over 95% of the electricity in the province. This gives Québec a plentiful, renewable source of power.
Lower electricity demand – Québec has a much lower population density compared to neighboring provinces and states. It also has a colder climate which reduces electricity demand for air conditioning in the summer. This means there is less pressure on Hydro-Québec’s generation capacity to meet domestic demand.
Interconnection infrastructure – Hydro-Québec has invested heavily in transmission lines and interconnections with neighboring markets. This allows the company to transmit its surplus power to major load centers in the US like New York, New England, and the Midwest.
Deregulation of US electricity markets – The deregulation of wholesale electricity markets in parts of the US in the 1990s allowed independent power producers like Hydro-Québec to sell into these markets. This provided new export opportunities.
Criticisms and Controversies of Electricity Exports
Québec’s electricity exports to the United States have not been without controversy. Critics have raised environmental and social concerns.
Environmental Concerns
Some argue that exporting electricity encourages further hydro development in Québec, resulting in flooding and habitat destruction. New dams and reservoirs can negatively impact ecosystems and indigenous lands.
There are also carbon emissions associated with reservoir creation, from the decomposition of flooded soil and vegetation. And long-distance transmission results in line losses.
However, exporting clean hydropower to the US also displaces fossil fuel generation there. Proponents argue the environmental benefits outweigh the impacts.
First Nations Issues
Several First Nations groups have opposed hydro development in Québec, citing lack of consultation and impacts on their lands and rights. Flooding has displaced some indigenous communities.
There are concerns that electricity exports to the US benefit utility companies while indigenous communities bear environmental burdens without shared economic gains.
Some First Nations are seeking revenue sharing and equity stakes in hydro projects on their territories as conditions for approval. Meaningful consultation remains an ongoing issue.
Economic Impact
Electricity exports to the US have had a significant positive economic impact for Quebec. Hydro-Quebec earns billions in revenue annually from electricity sales to the US. In 2021 alone, Hydro-Quebec reported earning over $3 billion CAD from exports to neighboring US states and provinces. These export revenues represent a major source of income for the provincial government.
The export of electricity has also stimulated job creation and investment in Quebec. Hydro-Quebec estimates that hydroelectric projects built in the last decade have created over 50,000 jobs. Additional jobs have been created to maintain transmission lines connecting Quebec to export markets. Going forward, Hydro-Quebec projects investing $25 billion in the next 10 years which will create thousands of jobs in construction and engineering.
Future Outlook
Hydro-Québec has plans to further strengthen its position as a major electricy exporter in the coming years. The utility is currently developing several new hydroelectric projects that will add over 3,000 megawatts of additional capacity to the existing system.
The Romaine River complex, currently under construction, will be completed in 2022 and will add 1,550 MW of capacity. Two other large-scale projects at theMagpie River (885 MW) and Petit-Mécatina River (230 MW) have received environmental approvals and could begin construction soon.
These new hydroelectric resources will allow Hydro-Québec to increase electricity exports, especially to neighboring US states. The company is actively pursuing new long-term export contracts and looking to expand transmission connections to access new markets in the Northeast US and Midwest.
Major initiatives include the proposed New England Clean Power Link that would allow 1,000 MW of exports via an underwater transmission line to Vermont, and the proposed Champlain Hudson Power Express line with a capacity of 1,000 MW to deliver electricity downstate to New York City.
With abundant hydro resources and strategic investments in new projects and transmission infrastructure, Hydro-Québec seems poised to grow its electricity exports substantially in the coming decades.
Conclusion
Hydro-Québec’s vast hydroelectric capacity allows it to produce large surpluses of renewable electricity. With limited growth in domestic demand, Hydro-Québec has developed transmission connections to export electricity to neighboring US states. These exports provide a major revenue source for Hydro-Québec and offer American states access to clean energy. However, Hydro-Québec’s exports have also been controversial, with concerns raised over environmental impacts and sending Quebec’s resources abroad. Looking ahead, Hydro-Québec plans to continue expanding exports to the US market. With many US states seeking to increase their renewable energy mix, there is significant potential for increased exports. However, uncertainty remains around future domestic demand in Quebec and the balance between retaining electricity for provincial needs versus expanding exports. Overall, Hydro-Québec’s electricity exports illustrate the opportunities and challenges of balancing local and export markets for resources.
