NYC Plans to Import Canadian Hydropower. Who Benefits?

Lucien Wabononik is sick of people getting rich at his expense. A member of the Nation Anishnabe du Lac Simon, he is fighting alongside members of several other First Nations in the Canadian province of Quebec against a plan to export hydroelectricity to the United States from territory Indigenous peoples have lived on for thousands of years. “There’s nothing offered to us,” he told New York Focus, explaining his opposition to the project. “We don’t benefit at all.”

The utility Hydro-Québec, which is owned by the provincial government, made $780 million in profits in 2017 by sending electricity from its network of hydro plants and reservoirs south of the Canadian border. Construction is expected to begin this year on the Champlain Hudson Power Express, a new 335-mile transmission line from Quebec to New York City.

More than one-third of the electricity for the Champlain Hudson project could come from territories Wabononik and his allies say First Nations never surrendered to Canadian authorities. “We were not even consulted on this project,” Wabononik said of the transmission line. “Again and again, they’re ignoring our people.”

Wabononik’s community of Lac Simon had a median income of just $12,288 in 2015, compared to about $33,000 for the province overall. In the Anishnabe community of Kitcisakik, residents lack sewage systems and running water. They have to use noisy and unreliable generators for their electricity—even though there is a hydro reservoir on the town’s shoreline, operated by Hydro-Québec. It was built to send power elsewhere in the province, not for the Indigenous people living right beside it.

The impact of Hydro-Québec damming rivers to create 4,000 square miles of reservoirs over the past century has been devastating to the region’s original inhabitants, court filings say. “It resulted in the forced and brutal removal of our members from their traditional territories and their settlement on reservations that were not and are still not structured to ensure the economic well-being of our populations,” reads a document sent by some Quebec First Nations in October to the U.S. Department of Energy.

Champlain Hudson, a crucial element of Hydro-Québec’s plan to double revenues to around $27 billion by 2030, could make these disparities even more extreme. Once the transmission line is built, Hydro-Québec’s revenues will soar and the utility will have fewer incentives to negotiate with the First Nations in Wabononik’s coalition, none of whom have been able to reach compensation agreements. “We see this as another project that’s going to have a negative impact to our rights,” he said.

Pressure mounts for clean replacement to Indian Point

In New York, meanwhile, elected officials are under growing pressure from climate advocates to build new clean energy infrastructure. Once the Indian Point nuclear plant closes next spring due to declining revenues and safety concerns, New York City’s reliance on climate-harming energy is expected to soar. Fossil fuels may supply as much as 86 percent of the city’s power needs by 2022, up from 67 percent in 2018.

In these circumstances, and as they look to meet aggressive state climate targets, lawmakers have billed Champlain-Hudson as a relatively quick and easy solution. Calling global temperature rise an “existential threat,” Mayor Bill de Blasio told Crains in late November that “ignoring vast amounts of zero-emission hydropower ready today would be a mistake.”

Champlain Hudson’s developer says it already possesses all the permits necessary to begin building. Transmission Developers recently told a Washington County Board of Supervisors meeting in the state’s north that construction on the transmission line, which will run six miles from the Quebec border under Lake Champlain before continuing due south under the Hudson River to New York City, is likely to begin in late 2021.

Governor Andrew Cuomo is also enthusiastic. “Let’s run the cable, the transmission lines from Canada to New York City to get that power down here and let's stop talking and let's start doing. Let’s invigorate this whole renewable market,” he said last summer.

Yet New York’s major environmental advocacy groups don’t support the proposal. Organizations like Sierra Club and Riverkeeper, along with smaller-scale power producers, criticize the project for crowding out other forms of renewable development—and claim it won’t even decrease emissions.

One reason for their skepticism: Hydro-Québec would source the electricity for the Champlain Hudson project from its existing network of hydro facilities—without building any new hydropower. This means it largely re-routes electricity that is already on the grid, experts and environmental advocates said. It would make New York’s electricity cleaner on a city and state level, climate advocates said, without substantially reducing net global emissions.

Instead of shuffling around existing supplies of clean energy, organizations like the International Energy Agency argue, governments should focus on aggressively building new low-carbon energy sources.

A report earlier this year commissioned by the Independent Power Producers of New York (IPPNY), a trade group representing energy companies competing with Hydro-Québec to supply the state’s electricity needs, questioned whether the project would actually be beneficial for the climate. “Without new power generation,” the study reads, “the purchase of electricity over [the transmission line] would result in no measurable reduction in carbon emissions.”

“It’s true that there are no new hydro generation facilities being built for this project, those have to be built beforehand,” Hydro-Québec spokesperson Gary Sutherland told New York Focus. But if existing hydro produced in Quebec can be used to prevent new fossil fuel power from coming onto the grid in New York City, he said, that would be equivalent to removing one-quarter of the current cars from the city’s streets. “This project will definitely help to reduce emissions,” he added.

Regulators in New Hampshire were not persuaded by similar arguments in favor of hydroelectric re-routing when they rejected a transmission line in 2018 that also would have carried power from Hydro-Québec. In that decision, the state’s siting committee found that “no actual greenhouse gas emission reductions would be realized if no new source of hydropower is introduced and the power delivered by the Project to New England is simply diverted from Ontario or New York.”

Brad Hager, an earth scientist at Massachusetts Institute of Technology, told New York Focus that to measure the actual climate impact of Champlain Hudson, analysts need to consider the wider power system — not just a single city or state’s emissions. “I believe that the regulators reached the correct conclusion,” he said of New Hampshire dismissing Hydro-Québec’s promise of climate gains without building new capacity.

A better way to make New York City’s electric grid cleaner would be to source the power directly from clean energy producers across the state, according to Gavin Donohue, IPPNY’s President and CEO. That would result in actual new projects being built, as well as local investment and jobs. “We have all these renewable assets that are more beneficial,” he told New York Focus.

Transmission Developers, which is owned by Blackstone, the world’s largest alternative asset manager, argues there’s no reason we can’t have both. “The need for renewable power is massive,” Jennifer Laird-White, a vice president at Transmission Developers, told New York Focus, citing New York state’s ambitious goal of 70 percent clean energy by 2030. Even after the Champlain Hudson transmission line is built, she said, there will still be “plenty of room for many additional renewable projects.”

If that scenario plays out, it could be despite Champlain Hudson and not because of it, Donohue said. The transmission line as currently proposed doesn’t have converter stations upstate, which would allow renewable projects in the north to connect and send their power through it. “It’s essentially an extension cord from Montreal to New York,” he said.

The Sierra Club agrees that Champlain Hudson isn’t designed to grow the state’s clean energy sector. While de Blasio has enthusiastically supported Canadian hydropower, the group points out, he so far hasn’t acted on calls from organizations such as NY Offshore Wind Alliance and Alliance for Clean Energy New York to offer a competitive request for proposals for locally-based projects.

“Beyond squeezing out in-state renewables and energy efficiency, Mayor de Blasio refuses to acknowledge the long, devastating impacts Canadian hydro has to Indigenous communities and our environment,” Sierra Club campaign manager Lisa Dix argued this summer. “New Yorkers should not be forced into buying destructive power when we have the ability to build our own clean energy economy right here.”

Given all that, critics say, Champlain Hudson looks less like the pathway to the vision described in New York’s Community Leadership and Community Protection Act—which aims to cut greenhouse gas emissions 85 percent by 2050 while addressing historic racial and economic disparities—and more like a continuation of an existing system where projects of dubious environmental benefit are built on the backs of Indigenous peoples and other disadvantaged communities.

“This project may chip away at fossil fuel emissions,” said Robert Galbraith, a researcher with a Buffalo-based corporate watchdog group called the Public Accountability Initiative. But by primarily benefiting Blackstone, which oversees $584 billion assets and has close ties to Governor Cuomo, as well as a Canadian utility whose revenues comes from hydro-projects on territory First Nations say is unceded, it “will further reinforce and entrench existing economic and political power dynamics,” he said.

The clean energy future that Champlain Hudson represents, Galbraith said, is one in which large politically-connected companies get rich while existing racial and economic disparities stay largely the same.

First Nations await settlement

The Mayor can’t plead ignorance to the concerns of First Nations. Last year, his office sent three delegates to Quebec to meet with Indigenous leaders about Champlain Hudson. Gerald Hervieux, an elected band counsellor with the Pessamit Innu First Nation, took part in that process. “They listened very carefully to what the Pessamit had to say,” the French-speaking Hervieux told New York Focus through a translator.

But listening is one thing and responding is another, Hervieux argued. If de Blasio takes the First Nations’ interests seriously, advocates said, he shouldn’t support the project until Hydro-Québec finds a way to compensate Indigenous peoples for the massive cultural and environmental disruptions caused by decades of constructing unwanted hydro projects on their territories. “People in New York should realize that we never gave any authorization to Hydro-Québec to build these facilities,” he said. “We want them to recognize the suffering of our nation.”

Over the past seven decades, more than a dozen hydro power stations and 11 reservoirs sited on the Pessamit First Nation’s traditional territories have transformed a landscape it has lived on long before European settlers arrived. The 3,170 square miles of hydroelectric reservoirs eroded river banks and destroyed salmon spawning grounds, reducing the amount of fish community members catch on the Betsiamites River from 1,200 per year before the dams to 170 now, a decline also attributed to climate change and commercial fishing. These and other impacts from industrial encroachment broke up communities, made it much harder to hunt and trap and resulted in economic disparities that persist to this day—the median income for Pessamit members is under $16,000.

Hydro-Québec has signed compensation agreements with some First Nations, including a 2002 deal with the Cree First Nation to receive $70 million a year up to 2050. But despite years of negotiation, no settlement has been reached with the Pessamit. “That’s an ongoing back and forth dialogue until we can get to an agreement,” Sutherland said. Nothing has been signed either with the other First Nations who wrote the U.S. Department of Energy earlier this fall.

To Wabononik, the clean energy future New York City leaders envision feels like another dirty chapter in a long colonial history of wealthy and powerful outsiders profiting from his territory. “This isn’t green to us at all,” he said.