Carillon Hydro-electric Dam, Pointe Fortune, Quebec. Photo by Mac Armstrong.
Legislation introduced in the House and Senate could open the door for a flood of “renewable” energy from Quebec.
Bills introduced by Rep. Tony Klein, D-East Montpelier, and Sen. Virginia Lyons, D-Chittenden, would establish a binding renewable portfolio standard, which would mandate that utilities buy a certain percentage of electricity from renewable sources.
Currently, the state operates what is called the Sustainably Priced Energy Enterprise Development program. The SPEED program promotes renewable energy development by encouraging long-term contracts for electricity from renewable sources.
The big question is: What is “renewable?”
Under current Vermont law, “renewable” means “energy produced using a technology that relies on a resource that is being consumed at a harvest rate at or below its natural regeneration rate.” Basically, if the resource replenishes itself faster than it is used, it is renewable under Vermont law. Enter Hydro-Quebec.
In 2010, Gov. Jim Douglas signed a bill designating large-scale hydroelectric power “renewable.” Previously, hydroelectric generating facilities had to produce less than 200 megawatts to achieve that label. The new designation takes effect in July 2012. This year, the Vermont Public Service Board approved a certificate of public good for 20 utilities to collectively purchase between 218 and 225 megawatts of energy from Hydro-Quebec starting in 2012 and continuing through 2038.
The “renewable” label never made much of a difference, until now.
Without careful planning, environmental groups fear electricity from Hydro-Quebec and other large-scale hydroelectric projects could essentially flood the market for renewable energy and eliminate the purpose of creating incentives for small-scale, local energy sources.
Klein said his proposed legislation has a lot of moving parts, but one of the major points is the renewable portfolio standard.
“What we’re doing is rolling the SPEED program into a renewable portfolio standard,” Klein said.
The SPEED program, started in 2005, set a goal of achieving 20 percent of statewide electric retail sales from small-scale local generation by July 2017. If the Public Service Board determines that those goals are not met, utilities will be required to meet a binding renewable portfolio standard.
Klein says his bill is a culmination of years of policy decisions to shift toward more renewable energy.
“All of these things are moving us forward on a policy that over the years Vermonters have supported,” he said.
Klein’s bill would require utilities to produce or at least own credits for renewable energy for 80 percent of the electricity they produce by 2025.
Both bills would, by creating a renewable portfolio standard, be the first time the rubber hits the road and utilities acknowledge Hydro-Quebec as a renewable source in an RPS.
Both Klein’s bill and Lyons’ bill address the potential for large-scale hydro to squeeze out other forms of lower impact, renewable energy sources. They both have tiers for what constitutes “renewable” and “new renewable” generation sources.
Klein’s bill separates existing and new renewable energy into two categories. New renewable projects are separated further into tiers based on the dates the projects go on line.
Tier one new renewable energy in Klein’s bill includes plants that come into service after Dec. 31, 2004, and before Jan. 1, 2013. Tier two renewable energy would include plants that begin operating in 2013.
Although Hydro-Quebec broke ground on the Romaine Complex project in 2009, it would not be a “tier 1″ but rather “tier 2″ under the first draft of the renewable portfolio standard legislation. The 1,550-megawatt complex would be classified as “new renewable” under tier two because it is set to come online in 2014. Hydro-Quebec also plans to add another 3,000 megawatts of large-scale hydro in its Northern Plan, which extends through 2035.
Lyons’ bill breaks it down into tiers as well. Her bill also will have language that will ask for tiering of environmental attributes, she said.
“You can’t ignore where you are getting it [energy] and how you get it,” Lyons said.
She said things like large-scale hydro generation facilities would be in a different tier from things like small-scale solar projects. Lyons admits the bill will need to go through some ironing.
“The bill is a skeleton of the discussion that will happen,” she said.
While environmental groups have commended the legislators for trying to ensure local renewable energy, concerns abound as to what will happen with large-scale hydro.
Sandra Levine, senior attorney with the Conservation Law Foundation, said the biggest challenge for both bills is determining how Hydro-Quebec fits in.
“The challenge going forward is how do we manage the rest of our renewable energy supply in a way that fairly treats renewable energy in the rest of New England?” Levine said. “We don’t want power from Hydro-Quebec to drown out all the other renewables in the region.”
While large-scale hydro power is a renewable resource, building massive dams can affect ecosystems by destroying wildlife habitat and releasing mercury into the environment, Levine said. Projects can also release significant amounts of greenhouse gases like methane during the first years of development, Levine said.
Levine said it makes sense to have different tiers, but how those tiers are defined is critical.
“Hydro-Quebec is a massive, government-owned utility,” she said. “To put them in the same class with small projects is unreasonable.”
One of the primary issues with large-scale hydro is the sale of renewable energy certificates. When utilities purchase renewable power, they receive certificates that they can then sell to other buyers.
In New England, Vermont is the only state that would qualify energy from large-scale dams as “renewable.” For example, under New Hampshire’s renewable portfolio standard, existing small-scale hydro projects must produce less than 5 megawatts of electricity. Under Maine’s RPS, projects must produce less than 100 megawatts. Existing hydro in Massachusetts must produce more than 5 megawatts.
Levine said the concern is with what are called “alternative compliance payments,” which utilities submit in lieu of purchasing renewable energy. A situation could arise where “renewable” energy is so cheap from large-scale hydro, that prices could dip to a point where utilities just buy credits from Vermont instead of more expensive in-state renewables. If Vermont were able to sell renewable energy certificates based on large-scale hydro to other New England states, it could undermine the regional market for renewable energy, Levine said. This is currently not allowed, since other states do not recognize the power in the same way Vermont does, but it is a real potential problem, she said.
“It would be an environmental disaster for Vermont’s renewable power statute to destroy markets for renewable power in the rest of New England,” Levine said.
In comments to the Department of Public Service on the state’s Comprehensive Energy Plan, both the Vermont Natural Resources Council and the Vermont Public Interest Research Group expressed concerns with including large-scale hydro in an RPS.
At a press conference releasing the final plan, however, Gov. Peter Shumlin said he is supportive of including energy from Hydro-Quebec as part of a renewable portfolio. He said he supports getting renewable energy from Quebec into Vermont and southern New England as a means of getting off our “addiction to oil.”
Shumlin said New England is a viable market for the renewable energy from Quebec. According to the Montreal Gazette, Hydro-Quebec predicts a 20 terawatt-hour surplus of electricity by 2020. One terawatt equals one trillion watts. A decrease in the energy needs of the utility’s industrial clients played a significant role in the predicted energy needs.
Or as Gov. Shumlin put it, “They can’t burn all the juice.”
A spokeswoman for Hydro-Quebec utility backs up the push for more large-scale hydro in New England.
In a written statement, Hydro-Quebec spokeswoman Ariane Connor wrote: “Hydro-Québec supports emerging renewable energy sources. Indeed, hydroelectricity is the only renewable baseload energy able to complement intermittent renewable energies such as wind and solar.”
She wrote that when there is no wind to power turbines, hydroelectricity can fill that gap. In acting as a back-up, Québec hydroelectricity supports the development of other renewable energy sources.
“There is room for both,” she wrote.
Editorial note: This story has been modified to reflect the following clarification: The Romaine Complex is set to come online in 2014. Although Hydro-Quebec broke ground on the project in 2009, it would not be a “tier 1″ but rather “tier 2″ under the first draft of the renewable portfolio standard legislation.
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This article only scratches the surface of the emerging disaster we are facing with Hydro-Quebec and its potential impact on renewables, along with utility-scale wind development and new transmission lines, all of which are really a package deal.
Business interests to the south of us in Massachusetts and other states are not really interested in having their states just purchase RECs for HQ power delivered to our local region, as the article suggests.
They are quietly driving efforts to have new power lines built down through Vermont and New Hampshire to bring actually HQ power down to those states, which they are betting will be significantly cheaper than other sources. At the same time, they are quietly opposing incentives for local renewable energy development, especially solar power because they believe the incentives for this source are too costly.
In conjunction with this, the NE-ISO is actively seeking to build 4000+ miles of new transmission in this region to accomplish all this and more. Specifically, the NE-ISO is seeking to provide transmission to support several thousand more megawatts of wind power and import several thousand more of HQ power to the Northeast. This is secret: Just peruse the documents on the NE-ISO website.
The new Vermont State Energy Plan and the initial legislative proposals discussed in the article are just a small part of this, but are perfectly consistent and apparently coordinated with this overall plan. For this reason the article is far to Vermont-only-focused, and misses the larger context almost completely.
The net effect of all of full regional development that is being sought will be tremendous environmental impact to Vermont, Maine, and New Hampshire, from both utility-scale wind and transmission development, with very little benefit for the development of truly serious and sustainable renewable electricity generation.
Specifically, due to the small size of onshore wind resources in this region, which are estimated by the National Renewable Energy Laboratory to be equivalent to less than 16 GW of conventional generation on average (more than half of which is in NY), the total amount of onshore wind generation will forever remain only a few percent at very best of the energy requirements of the Eastern United States. The resource to more simply doesn’t exist (average US electricity generation is roughly 450 GW).
And there will be essentially no significant onshore wind power development in the Southeastern US. So none of this massive development will help bring renewable energy generation to the region of the US which is most dependent on coal.
At the same time, the billions of dollars invested in new transmission and wind in the Northeast will use up the little remaining “headroom” in electricity rates that might otherwise have been used 5-10 years from now to fund the one renewable electricity source that really could have made a difference – solar power. I say this because 1) solar is in fact the only onshore renewable power source with anywhere close to the potential to do the job, and 2) solar appears to have a much better long term cost outlook than wind, including offshore wind.
So the path that Vermont, Maine, and New Hampshire are currently on is one of a historic folly, and little more than a quick corporate grab at inappropriate renewable energy sources in the absence of careful energy planning. And it will likely set back meaningful progress in solar power development for decades, leaving coal-fired generation firmly in place in the Eastern US for decades longer than might have otherwise occurred.
And groups that have supported utility-scale wind development in Vermont without having first done the basic research on the regional resource bases and cost trends will have contributed as much as anyone to this debacle.
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The story states incorrectly that the Romaine hydro complex would be qualified as tier 1 new renewable. The first unit at Romaine-2 (2 X 320 MW = 640 MW) won’t feed the Quebec grid before Q3-2014. Romaine-1 (270 MW) will follow in
2016, Romaine-3 (395 MW) in 2017 and Romaine-4 (245 MW) in 2020.
However, these recent additions to Hydro-Québec’s hydroelectric generation fleet would fit nicely in the 2004-2013 timeframe for the so-called tier 1: Toulnustouc (526 MW, 2005), Peribonka (405 MW, 2008), Mercier (50 MW, 2008), Chute-Alllard and Rapide-des-Coeurs (138 MW, 2009), Eastmain-1 (507 MW, 2007), Eastmain-1-A (768 MW, 2011-2012) and Sarcelle (150 MW, 2012), for a total of 2,544 MW.
Second point. The writer seems to be mixed up with energy units. A terawatt-hour (TWh) is equal to a trillion ***watt-hour*** (not “one trillion watts” as the story incorrectly states) or a billion kilowatt-hour (kWh), or a million megawatt-hour (MWh) or 1,000 gigawatt-hour (GWh).
If you want to give your reader a useful point of reference, the total electric demand in Vermont in the year 2009 was 6 TWh according to the December 2011 CEP (volume 2, page 32, exhibit 3-1). So 1 TWh is enough electricity to meet the total electric demand in the Green Mountain State for two months.
Last point. If the state is serious with its plan to go 90% renewable by 2050, electric demand will inevitably displace some of the oil and gas you currently use to fill your cars and heat your homes. If you want to become America’s Denmark, you’ll need a Norway.
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Cloude,
Your comments are priceless and rational. I assume you are a power systems engineer/analyst.
Rep. Klein is pushing Vermont to become like Denmark and Germany, both of which are renewables mavens, both of which have the highest household electric rates in Europe.
New England is very lucky to have low-cost, 5 to 6 c/kWh, 24/7/365, hydro-electric energy available from Hydro-Quebec under long-term contracts. Renewables promotors would like to roll their high-cost, variable, intermittent energy into the rate schedules for their personal business and tax-sheltering benefit, at the expense of all other households and businesses and the New England economy. Per Economics 101, an economy with high-cost energy will not perform as well as one with low-cost energy.
Ben,
The least-costly, c/kWh, and most effective (maximal CO2 reduction/kWh) way to reduce CO2 emissions in New England is with as much hydro-electric energy as possible from Hydro-Quebec. We should not be concerned with renewables business development being reduced in New England as a result of the Hydro-Quebec energy, because the renewables energy is far more expensive per kWh; why shoot oneself in the foot for ideological/emotional reasons?
Some PV solar energy is generated at the user level and therefore competes with user rates of about 14c/kWh, but it would only be a tiny fraction of our TOTAL energy needs.
Spain (good for solar, an economic basket case) and Germany (bad for solar, actual CF = 0.095, dismal) have had massive build-outs of PV solar at great cost, and their PV solar energy production is STILL a tiny fraction of their TOTAL energy needs.
PV solar is variable and intermittent, minimal in the morning, maximal at noon 3-4 hours before the daily peak demand, minimal in the evening, zero at night and minimal with snow/ice on the panels. The useful service life of PV solar systems is about 25 years.
Where would the other energy come from? From the grid? Emergency diesel-generators? Utility-scale energy storage cost adder is about 23c/kWh, according to David Hallquist, CEO of VEC. Distributed storage is similarly expensive. A massive electric vehicle build-out is far off in the future.
New England is not blessed with the steady, strong trade winds of the Caribbean, or with the steady, strong winds of the Great Plains.
Wind energy in New England is minimal during summer, so-so in spring and fall, most during the winter, at all times it is mostly generated at night. About 10-15 % of the hours of the year there is too little wind (less than 7.5 mph) to turn the rotors or too much wind. That leaves just a few hours of the year that wind energy is actually generated in New England. The environmentally-destructive, highly-visible, adverse-health-impact nature of wind turbine facilities on ridge lines is very well documented by the Maine, Vermont, Cape Cod experience.
Other base-load generators are needed to provide the bulk of our energy needs. It is important to focus on what they are to be.
Even Germany, after its initial irrational exuberance with renewables, is beginning to realize a major increase in energy efficiency and an additional build-out of coal and gas-fired generation is needed before all its existing nuclear plantsa are decommissioned. See URLs.
http://theenergycollective.com/willem-post/67528/german-nuclear-decommissioning-and-renewables-build-out
http://theenergycollective.com/willem-post/69710/will-germany-make-global-warming-difference
http://theenergycollective.com/willem-post/71771/energy-efficiency-first-renewables-later
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“Other base-load generators are needed to provide the bulk of our energy needs. It is important to focus on what they are to be.”
Saranac Power Partners cogen in Plattsburgh is already here and can provide power to Vermont over existing transmission.
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My suggestion to those who want to embrace small scale renewables is go go off grid. I’ve lived off grid for over 27 years. Solar, mostly. Wind doesn’t produce much. One thing is certain; if everyone who wanted to be “green” did this, the reason for using hydro would become immediately clear. Hydro is energy dense. Solar and wind aren’t, and living in the dark on the shortest day of the year is somewhat…dark. But my footprint is small, so that brightens the darkness a bit. A very little bit.
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Steve Wible,
Vermont is the only New England state with ready access to natural gas that does not have a highly-efficient (up to 60%) combined-cycle gas turbine generator (CCGT) plant.
Three 350 MW units would generate 8,000 GWh/yr, more than the 6,000 GWh/yr consumption of Vermont, at a cost of about 7-8 c/kWh. This is steady, 24/7/365, 100%-dispatch-value energy, not the variable, intermittent, no-dispatch-value energy from wind turbine plants.
GE would finance, build, operated and maintain the CCGT plant, as it does with many such plants throughout the world.
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Mr. Post,
Saranac Power already exists just across the lake. There is existing transmission between New York and Vermont between Plattsburgh and South Hero Island. 100 megawatts could be transmitted today, which is enough to alleviate reliability issues in northern Vermont. There is no need to build any power plants or any new transmission.
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Steve,
Even better would be to buy more steady, 24/7/365, pollution-free, CO2-free, hydro energy from Hydro-Quebec at about 5-6 c/kWh under long term contracts, instead of rolling pollution-free, CO2-free, variable, intermittent, zero-dispatch-value energy from tax-sheltered PV solar systems into the rate schedules at about 24c/kWh.
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Wake up folks. The renewable energy mandates are really rigged corporate mandates.
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Mr. Post,
Any new renewable power would require miles of new transmission lines. Saranac Power burns natural gas, has state of the art pollution control equipment, and already exists adjacent to existing VELCO lines that go to Vermont.
Quebec Hydro sounds nice until they start running miles of new transmission lines all over Vermont.
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Alan,
You state that The SPEED program promotes renewable energy development by encouraging long-term contracts for electricity from renewable sources.” This is misleading since the SPEED program does not really promote renewable energy contracts. The only way a Vermont utility can claim to purchase renewable energy is for that utility to acquire the Renewable Energy Credits (RECs) associated with a generation source. The SPEED program encourages Vermont Utilities to sell any RECs from Vermont resources to other states that have Renewable Portfolio Standards such as Massachusetts and Connecticut. Vermont Utilities which participate in the SPEED program and sell their RECs out of state (which is the standard practice in Vermont and consistent with Vermont law) are actually procuring brown power (gas, coal, and nuclear) for Vermont customers and actually increasing Vermont’s carbon footprint compared to an alternative where we had an RPS and retired rather than sold the RECs. In fact the SPEED program is encouraging Vermont utilities to purchase brown power often at significant premiums — which makes no sense. The notion that the SPEED program procures renewables for Vermonters is an illusion and it would be a false claim and illegal to claim that energy associated with SPEED resources is renewable energy for Vermonters when the RECs are sold out of state. Based on my over 20 years experience in the electric power industry the SPEED program is incredibly flawed and perhaps the worst designed renewable energy program in the country. Our legislative leaders should replace it ASAP with a real Renewable Portfolio Standard similar to all of the other New England States and New York.
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Kevin,
According to a December 2009 VT-DPS white paper, about 35% of the $228.4 million required to implement 50 MW of renewables would be supplied by Vermont sources, the rest, mostly equipment by foreigners, such as PV panels from China, inverters from Germany, wind turbines from Denmark and Spain There would be spike of job creation during the 1-3 year construction stage (good for vendors) which would flatten to a permanent NET gain of 13 full-time jobs (jobs are lost in other sectors) during the operation and maintenance stage.
Germany and Spain had similar misallocations of capital and net job creation, the fallout of unwise government policies.
The “scrubbed” Vermont Energy Plan wants to expand the flawed SPEED program and roll it into Renewables Portfolio Standard, which would make maters worse on a grander scale. It would be the ultimate kick in the pocket book for already strapped households and business rate payers.
http://publicservice.vermont.gov/planning/DPS%20White%20Paper%20Feed%20in%20Tariff.pdf
http://www.rwi-essen.de/pls/portal30/docs/FOLDER/PUBLIKATIONEN/GUTACHTEN/P_RENEWABLE+ENERGY+REPORT+RWI+FORMAT.PDF
http://theenergycollective.com/willem-post/69710/will-germany-make-global-warming-difference
http://theenergycollective.com/willem-post/71771/energy-efficiency-first-renewables-later
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While Hydro Quebec has been a reliable source of power, it should not be viewed as an “inexpensive” source of power. The new HQ contracts are designed to ride the market. While market prices are low today, due to the ample supply of natural gas, that could change in the future.
The transmission line across the lake to Plattsburgh will need to be upgraded if it is to reliably carry power from Saranac Power (within transmission operability standards). It should not be considered a no-cost propostition.
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David,
It is true new HQ contracts include “riding the market”, albeit not on an hourly or daily basis.
Regarding gas supply, we can safely assume it will be plentiful for many decades and at prices far below those of Vermont’s high-cost, variable, intermittent, no dispatch value wind and solar energy.
Unsubsidized ridge line wind energy about 15c/kWh.
About 50% subsidized ridge line wind energy about 10c/kWh, per GMP.
About 50% subsidized solar energy about 24c/kWh, per SPEED program.
Rolling these costs into rate schedules in greater quantities will adversely affect household and business energy budgets, reduce job creation and standards of living. Vermont’s job creation has been miserable for some years.
A much more economically-viable and environmentally-beneficial measure to reduce CO2 would be increased energy efficiency. A 60% reduction in Btu/$ of GDP is entirely possible with existing technologies. Such a reduction would merely place the US on par with most European nations.
It would be much wiser, and more economical, to shift subsidies away from expensive renewables, that produce just a little of expensive, variable, intermittent energy, towards increased EE. Those renewables would not be needed, if we use those funds for increased EE.
EE is the low-hanging fruit, has not scratched the surface, is by far the best approach, because it provides the quickest and biggest “bang for the buck”, AND it is invisible, AND it does not make noise, AND it does not destroy pristine ridge lines/upset mountain water runoffs, AND it would reduce CO2, NOx, SOx and particulates more effectively than renewables, AND it would slow electric rate increases, AND it would slow fuel cost increases, AND it would slow depletion of fuel resources, AND it would create 3 times the jobs and reduce 3-5 times the Btus and CO2 per invested dollar than renewables, AND all the technologies are fully developed, AND it would end the subsidizing of renewables tax-shelters at the expense of rate payers, AND it would be more democratic/equitable, AND it would do all this without public resistance and controversy.
http://theenergycollective.com/willem-post/46652/reducing-energy-use-houses
http://theenergycollective.com/willem-post/61774/wind-energy-expensive
http://theenergycollective.com/willem-post/64492/wind-energy-reduces-co2-emissions-few-percent
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The transmission line across the lake to Plattsburgh will need to be upgraded if it is to reliably carry power from Saranac Power (within transmission operability standards). It should not be considered a no-cost propostition.
Mr. Hallquist,
That line could handle 100 mw today. That is sufficient for the reliability needs of northern Vermont.
Mr. Post,
Renewables aren’t the polyana you describe, at least not in the short term. Renewables will require new transmission lines taht no one wants. Saranac Power exists today.