From 1.9 billion US when it was proposed, the cost of the interconnection under Lake Champlain to transport electricity from Quebec to New York is now estimated at 4.5 billion US.
Posted at 9:00 a.m.
The project known as the Champlain Hudson Power Express is a 545 kilometer link between the Quebec border and New York City, piloted by Transmission Developers Inc., a private developer partner of Hydro-Quebec and financially supported by Blackstone . It has already obtained all the necessary permits and is awaiting the final authorizations from the State of New York before starting work.
Originally, the developers expected the interconnector to be commissioned in 2015. The start of deliveries in New York is now expected 10 years later, in 2025. In the meantime, the costs to build and bury the transmission line have more than doubled and now totals US$4.5 billion, or more than C$5.7 billion.
By comparison, the interconnection project between the Quebec border and Massachusetts, which is now paralyzed due to Maine’s opposition, is estimated at 1 billion US. It is a shorter link (233 km) and built above ground rather than buried.
Expensive technology
Champlain Hudson Power Express will be partly subsea and partly buried underground. “It’s a more expensive technology,” confirms Lynn Saint-Laurent, spokesperson for Hydro-Québec.
The Crown corporation must finance the construction of the Quebec portion of the interconnection, ie a 57.7 km link between the Hertel substation, near La Prairie, and the border. Most of the link will be buried underground, and the final 1.6 km stretch will pass under the Richelieu River to connect to the Champlain Hudson Power Express.
The investment required for the construction of the portion on Quebec soil has not yet been made public. The Mohawk Council of Kahnawake should pay part of it, since it will be co-owner of the line with Hydro-Quebec and will collect part of the revenues related to the transmission of energy during the term of the contract with New York.
This is the first time that the government corporation has shared ownership of one of its transport infrastructures. The share of the Mohawk community in the transmission line is not yet publicly known. A new entity will be created to oversee this unique partnership in the history of Hydro-Québec, the company said.
The contract between Hydro-Québec and New York provides for the delivery of 10.4 terawatt hours of electricity for a period of 25 years, which corresponds to 20% of the city’s consumption. The starting price was set at 9.75 US cents per kilowatt hour. This price should be adjusted each year to reach 17.64 US cents per kilowatt hour in 2050. The contract should generate revenues of 30 billion US for Hydro-Québec, or more than 38 billion CAN.