Hydro-Québec's "Shared Ownership" of Power Lines with Blackstone Hedge Fund
On April 4, Bill 13, An Act respecting the Hertel-New York interconnection line, was passed in the National Assembly of Quebec and received royal assent on April 6. The law makes official the agreement between Hydro-Québec and the Mohawk Council of Kahnawà :ke (MCK) for what has been dubbed a "partnership" to build a direct current high-voltage transmission line linking Montreal's South Shore to the Canada-U.S, border near Champlain, New York.
From there, the line will connect to the remaining 530 kilometres of an underground/aerial transmission line running to the Astoria substation, located in New York City's Queens borough, by 2026. It is part of the signed agreement between Hydro-Québec and the New York State Energy Research and Development Authority (NYSERDA) for the annual delivery of 10.4 terawatt-hours of electricity to New York City by way of the Champlain Hudson Power Express (CHPE) line. This energy will be taken from already existing hydro dams in Quebec and Newfoundland.
Map showing location of the Hertel-Champlain 55-kilometre
power transmission line.
Private Supranational Interests Behind the Building of the
Power Transmission Lines
A November 30, 2022 announcement from the Governor of New York State's office confirmed that Transmission Developers Inc. (TDI) has been awarded the contract to manage the building and operation of the U.S. portion of the transmission line. In a similar statement April 14, 2022, Hydro-Québec said that its "U.S. partner, Transmission Developers Inc. (TDI), will begin construction of the line in summer 2022, with commissioning scheduled for 2025." What the statement doesn't mention is that in 2021, the building of the Canadian section was also awarded to TDI, a "wholly-owned portfolio company" of Blackstone, part of the $975 billion in assets of that same hedge fund.
In an article entitled "Quebec Institutions' Partnership with Blackstone Hedge Fund," Pierre Soublière references a Journal de Montréal, article noting that "Blackstone played a first-rate role in renegotiating free-trade with the United States and Mexico. The article points out that in 2017, [Blackstone CEO Stephen] Schwarzman – who is said to have had close ties to Trump – came to Canada to meet with then Quebec Premier Philippe Couillard and Prime Minister Justin Trudeau."
It is noted that "there are close ties between Blackstone and Quebec's Caisse de dépôt et placement (CDPQ), identifying Blackstone as CDPQ's most important 'partner' in the private investment and real estate sectors. In 2020, the CDPQ held $4.4 billion in investments in 25 of the company's funds, which was 13 per cent higher than two years earlier."
The article points out that in the agreement between Blackstone and Hydro-Québec, the transportation cost of electricity along the Hertel-Champlain transmission line "remains confidential because of the sensitive trade information involved. Still, according to government sources, Blackstone will receive close to $10 billion in revenue over a 25-year period – one-third of the $30 billion global contract."[1] So much for the " $30 billion sale" benefits for Quebec that the Legault government's Minister of Energy Pierre Fitzgibbon boasted about, related to the need to export "clean" electricity to the United States.
Another article, entitled "NYC's Big Clean-Energy Project Poses a Major Climate Test for the Country," published on Huffpost, informs that: "The Biden administration, which backs Champlain Hudson [CHPE] and listed it among top priority projects, has taken some steps to make building transmission lines easier. The newly passed bipartisan infrastructure law [the Infrastructure Investment and Jobs Act], directs billions to transmission issues and gives the [U.S.] federal government more power to designate a national interest in certain projects and routes to build them, making it easier for developers to overcome opponents."[2]
In other words, the Biden administration, like the Trudeau government, is facilitating the plunder of the public treasury in the name of high ideals while ensuring police powers prevail when it comes to energy corridors, as was the case with the expansion of the Trans Mountain oil pipeline and the building of the Coastal GasLink pipeline in BC and now, the power transmission lines to export electricity to the U.S.
Hydro-Québec Fishing in Trouble Waters
The contract signed between Hydro-Québec and NYSERDA, for the export of electricity to the U.S., stipulates that the government-owned corporation cannot sell electricity from dams built after the signing of the deal. This clause was put in place to address concerns about Hydro-Québec never having signed agreements with many Indigenous Peoples -- such as the Innu, Atikamekw and Anishinabek First Nations -- before building dams in the 1940s, 1950s and thereafter, on their unceded lands.
Map showing Hydro-Québec transmission line network in relation
to adjacent provinces and U.S. states.
Still, the Legault government is now contemplating building more hydro dams because Hydro-Québec faces an energy shortage before the end of the 2020s. It has to do in part with the Legault government's promises to supply cheap "clean" electricity to big foreign private interests such as Rio Tinto, with its Sorel-Tracy smelter, and General Motors (GM), BASF and Vale, who want to set up shop in the Bécancour area, dubbed the "battery hub" of Quebec.
All energy experts agree that as the 2026 deadline approaches to begin exporting electricity to the city of New York, Hydro-Québec will have to look at ways of generating more electricity before the end of the decade, without counting on new dams being built within such a short time span. So the issue of upgrading existing hydro power generating stations is on Hydro-Québec's agenda, along with the construction of more wind-turbine farms. All the existing wind-turbine facilities in Quebec were built under public-private partnerships during the Charest-Couillard Liberal governments and every indication points to the Legault goverment carrying on the same tradition.
Hydro-Québec`s
energy sources and sales in 2022.
Even Quebec's Office of Public Hearings on the Environment (BAPE) weighed in on the issue of Hydro-Québec supplying enough electricity to meet both domestic demand in Quebec and energy export contracts to the U.S. In BAPE 's March 16 final report on the Hertel-New York Interconnection Line Project, its two commissioners allude to it :
"The 'Optimal GHG reduction trajectories for Quebec – Horizon 2030 and 2050' report prepared for the Ministry of the Environment and the Fight Against Climate Change, concluded that reaching the reduction targets set by Quebec will require a major shift for society, which would have repercussions on Quebec's economy, environment and population. [...] Projections show that, as early as 2026-2027, Hydro-Quebec will need new supplies 'to ensure this "energy transition" towards a "zero-net emission" by 2050,... while exports of 10.4 TWh/year of electricity to New York City will begin in the spring of 2026, according to the contract between Hydro-Québec and the New York State Energy Research and Development Authority."[3]
The concern raised by the BAPE commissioners as well as several organizations dealing with energy issues was also echoed in Quebec's National Assembly on the day Bill 13 was to be adopted. Amongst other things, Québec Solidaire MNA for the Montreal-North riding of Maurice-Richard, Haroun Bouazzi, had this to say :
"I challenge the people here to tell us where the document is that explains the government's strategy for 2030, or even 2050, on energy issues. It simply does not exist. [...] We are in the process of signing a contract for 10.4 Terawatt-hours of electricity over 25 years. If I remember correctly, that corresponds to eight to nine per cent of our Quebec production, [...], a 25-year contract, at a time when we have no plan [...] Regarding wind turbines and the privatization of energy generation in Quebec, there is also business to be done, clearly, in selling our electricity, amongst other things, as can be seen in this contract with New York. It's as if seeing the $30 billion over 25 years gets us ready to sign anything and everything without having decided in advance what our energy plan would be...it's also possible that it's a huge mistake to sign this contract and make this transfer, when we don't even know yet what the plan is to avoid electricity shortages in 2026 or we may even find ourselves buying electricity at an absolutely exorbitant price on the commodity spot markets."[4]
Graphic showing Hydro-Québec forecasts of energy and peak
power demand for the next decade. Purchases on the short-term
(spot) markets (in dark grey) and additional supplies required
(in hatched grey) are steadily increasing as of 2026.
All of this reveals that the people of Quebec cannot be held
hostage to the self-serving plans of government where approval
to build new infrastructure is forced through and pay-the-rich
schemes financed before anything is known about them. Canada's
natural resources must be used in a manner that contributes to
the well-being of the people of Quebec and Canada and the
peoples of the world as set by the people themselves, not
narrow private interests. According to the logic of North
American free trade deals, along with increasing energy
exports to the U.S., comes the edict that this steady flow
cannot be reduced for any reason. This means that more and
more of Canada's infrastructure will be directly claimed by
the U.S. military as critical to its functioning. The actions
of workers and the people of this country will be banned and
criminalized. Elaborating an alternative in which Canada's
vast resources can be used for nation-building in a manner
that makes Canada a zone for peace is an urgent necessity.
Notes
1. "Quebec Institutions' Partnership with Blackstone Hedge Fund," by Pierre Soublière, In the News, April 15, 2022.
2. "NYC's Big Clean-Energy Project Poses A Major Climate Test For The Country," by Alexander C. Kaufman, Huffpost, April 13, 2022.
3. "Projet de ligne d'interconnexion Hertel-New York -- Le BAPE publie son rapport", March 16, 2023, BAPE Report no. 369, pages 29-31
4. "Journal des débats de l'Assemblée nationale du Québec", Vol 47, no 30, Tuesday April 4, 2023.
(With files from: TML, Hydro-Quebec, Quebec National Assembly, Governor of New York State, National Law Review. Translated in part from original French by TML)
This article was published in
Volume 53 Number 4 - April 2023
Article Link:
https://cpcml.ca/Tmlm2023/Articles/M530043.HTM
Website: www.cpcml.ca Email: editor@cpcml.ca