U.S. court ruling reverses block of Hydro Quebec power plan in Maine

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Maine’s highest court has sided with Hydro-Québec and its commercial partner, Avangrid Inc., in a high-profile dispute over a new electricity transmission line that would carry Canadian hydropower to New England, giving new spark to the utility’s ambitions to supply the U.S. northeast.

In a long-awaited decision released Tuesday, the state’s Supreme Judicial Court ruled unconstitutional a referendum held last year in which voters rejected Hydro-Québec’s proposed US$950-million New England Clean Energy Connect project. The court agreed with the project’s promoters, who had argued the referendum violated their constitutional rights by superseding regulatory approvals the line had already received. The case will now go to a lower court for further examination.

“The project remains part of Hydro-Québec’s long-term vision, as the company is committed to supporting the transition to a clean energy future,” the provincial-government-owned utility said in a statement. It said it was reviewing the court’s decision so it can determine next steps and assess potential impacts to the line’s construction schedule.

The ruling provides some vindication for Hydro-Québec and Avangrid. The partners have said the project enjoys widespread support among political and business leaders and has obtained all its required permits.

Although the win revives a project that was in danger of dying and bolsters Hydro-Québec’s effort to become a key supplier of clean energy to the U.S., the utility still faces several hurdles to completing the transmission line. A related case is still before the Maine Supreme Court. It concerns the validity of a state lease that allows the line to cross one mile of public land.

Quebec looks beyond hydroelectricity as last planned megaproject nears completion

Hydro-Québec has been trying for years to find a path to get its power to Massachusetts, after the state awarded the government-owned corporation a contract in 2018 to supply 9.45 terawatt hours a year of electricity – enough to power 1.2 million households. The 20-year supply agreement is worth an estimated $10-billion in revenue to Hydro, making it one of the utility’s largest-ever deals.

Clean Energy Connect is the latest proposal for fulfilling that contract. When completed, the line would be a 233-kilometre, high-voltage conduit stretching from the Canadian border through western Maine to its ultimate destination in Massachusetts. Most of the line would be built along existing power corridors.

The project has been deeply divisive. Supporters and opponents have waged intense battles, and the energy companies involved have spent close to US$100-million collectively on attempts to capture public support, trade publication Utility Dive has reported.

The Natural Resources Council of Maine, a leading environmental advocacy organization in the state, has warned that the power line would cut a “permanent gash through Maine’s western mountains, forever harming a globally significant region that supports a vibrant outdoor recreation economy.” Other environmental groups have voiced support for the project, saying it will achieve a higher good: that of replacing fossil fuels, such as natural gas, with cleaner energy.

The referendum happened in November, after critics of the project gathered thousands of signatures. A majority of voters cast ballots in favour of banning the line’s construction. Hydro-Québec and Avangrid have suspended work on the project until its legal challenges are resolved, at the request of Maine’s governor.

Hydro-Québec chief executive Sophie Brochu is trying to boost Quebec electricity exports to nearby U.S. states by striking multiyear supply agreements, which she has said will have environmental benefits. In a separate deal, the utility was chosen last year for a multibillion-dollar contract to deliver renewable power into the heart of New York.

Ms. Brochu’s effort is facing significant resistance, however – particularly in Maine and not only from environmentalists. Hydro-Québec has also become a target of established U.S. oil and gas players.

Ms. Brochu has blasted rival energy companies, especially Houston-based natural gas electricity producer Calpine Corp., for relentlessly trying to block the project and hijacking what she has acknowledged are legitimate concerns by local residents at the grassroots level.

Calpine owns generation facilities in several states, including a gas plant in Westbrook, Me., that supplies the region.

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