Opponents of 1,250-MW power line into New York City cite winter deliverability

Major New York electricity consumers, merchant power generators and environmentalists are opposing a proposed 1,250-MW underground transmission line from Québec to New York City, largely citing potential winter deliverability concerns, while supplier Hydro-Québec refuted these claims.

The New York State Energy Research and Development Authority in November 2021 approved two contracts to deliver solar, wind and hydropower into New York City through new transmission lines, with an expected average Tier 4 renewable energy credit cost of $28.29/MWh for both projects. Stakeholders have been submitting comments regarding the two contracts as part of a New York Public Service Commission proceeding (15-E-0302).

The 1,250-MW Champlain Hudson Power Express project has been under development for many years and would involve building a high-voltage direct current line from the Canadian border into the city that would primarily run under the Hudson River and existing rail lines. CHPE is being developed by Transmission Developers, backed by private equity firm Blackstone. The project would be supplied with hydropower from provincially-owned Hydro-Québec's reservoir system.

"The Hydro-Québec Project does not guarantee delivery of Tier 4 RECs in the winter, despite the fact that [New York Independent System Operator] modelling predicts that New York's peak electricity demand will shift to the winter as building electrification progresses," the Alliance for Clean Energy New York said in comments posted Feb. 8 to the NYPSC website. ACE NY is a member-based organization that promotes using clean, renewable electricity technologies and energy efficiency in New York.

Other commenters echoed what they said were winter deliverability concerns related to the CHPE project.

The selected Hydro-Québec bid includes summer-only unforced delivery rights, meaning there are "no specific delivery obligations during the winter peak, which will become increasingly constraining during the term of the proposed contract," the Sierra Club said.

Merchant power generator trade group Independent Power Producers of New York said it "stands by the rejection" of the Hydro-Quebec US project because it will only help meet the New York state's summer peak demand for electricity.

"It is concerning that the HQUS project was selected despite being only able to provide capacity during nearly half the life of the proposed 25-year contract, raising serious questions regarding the reliability benefits of the project," the power generators group said.

Hydro-Québec, for its part, contends the transmission line will help support intermittent in-state renewables and that its capacity will be split evenly between summer and winter.

"The reliability associated with deliveries of Québec hydropower over CHPE is considerably higher than projects using intermittent resources," spokesperson Gary Sutherland said in a Feb. 8 email. "HQ is committed to delivering over CHPE 10.4 TWh, half in winter and half in summer, and has economic incentive to deliver up to the full capacity of the line, including all winter," he said.

HQ's continuously available baseload renewable energy supply, delivered through the CHPE project, "will ensure that renewable energy is delivered during peak hours, thus substantially reducing the need to dispatch high-emitting resources," according to the company's PSC comments.

'Clean Path New York'

The second contract picked by NYSERDA is for a project called "Clean Path New York." It combines a 1,300-MW, 174-mile underground HVDC transmission line with over 3,400 MW of new wind and solar projects in upstate New York, with availability and reliability maximized by the existing Blenheim-Gilboa pumped hydro storage facility, according to a statement. The project is a partnership of the state New York Power Authority and private companies Invenergy and energyRe.

IPPNY and the environmental groups said they prefer the Clean Path project because it would be supplied with in-state renewable energy resources, thus benefitting local companies and economies.

Inclusion of a New York converter station in the Hydro-Québec Project, which was included in one of their alternate bids, would have allowed "upstate renewable energy developers to benefit from the project and would have alleviated current grid constraints in New York," according to ACE NY.

IPPNY echoed these comments, saying one "major downside to the HQUS proposal is that the project would bypass both existing and new upstate renewable generation."

A group of 50 large New York power consumers known as "Multiple Intervenors," expressed concerns to the NYPSC regarding cost increases associated with both projects.

Under certain scenarios, Department of Public Service staff and NYSERDA say the first-year bill impacts of the proposed contracts could be as high as 5.7% statewide, the group said, which includes both power delivery and commodity costs.

"The fact that these two contracts could cause electricity bills to increase by as much as 5.7% statewide should be a huge concern to the Commission," the Multiple Intervenors said.

The group said the PSC needs to carefully evaluate the "exceedingly-high costs" that the contracts would impose on electric customers and act to "materially ameliorate" the cost impacts.

The next step is for the commission to review the comments. Reply comments due Feb. 21 and a decision date has not been set or announced.