Transmission line for Canadian imports advances

A proposed high-voltage direct current transmission line designed to import Canadian power into the New England grid has received a favorable environmental recommendation from the U.S. Department of Energy. 

The New England Clean Power Link is a high-voltage, direct-current transmission project proposed by TDI New England, a subsidiary of private transmission developer Transmission Developers Inc. and ultimately part of the Blackstone Group.

Designed to feed the New England market with up to 1,000 megawatts of electricity, the proposed $1.2 billion New England Clean Power Link project would feature two parallel cables approximately 5” in diameter, operating at a voltage of approximately 300 to 320 kV.  These HVDC lines would run about 154 miles.  Originating at a DC converter station in Quebec, the U.S. portion of the line would start at the international border in Alburgh, Vermont.  It would run beneath the bottom sediments of Lake Champlain for about 98 miles, then turn east and run over land (but underground, mostly under roadway rights-of-way and railway beds) to a terminal converter station in Ludlow, Vermont, where the power could flow onto the New England grid.

Federal law requires most infrastructure development for international trade in energy to apply for and receive a Presidential Permit before the project may be built.  TDI New England applied for the presidential permit in May 2014, and applied to the state of Vermont for permits in December 2014.

As part of the Presidential Permit process, the federal National Environmental Policy Act or NEPA requires the U.S. Department of Energy to evaluate the potential environmental impacts in the United Statesof the proposed action and the range of reasonable alternatives.  In this case, the proposed federal action is the issuance of a Presidential permit to the applicant, Champlain VT, LLC, doing business as TDI - New England, to construct, operate, maintain, and connect a new electric transmission line across the U.S.-Canada border in northern Vermont.

On June 3, the Department of Energy released its final draft Environmental Impact Statement or EIS for the New England Clean Power Link.  In that document, the Department found relatively minimal and short-term adverse environmental impacts from project construction, operation and maintenance. 

Once notice of the draft EIS is published in the Federal Register, the public will have 60 days to comment on its analysis.  The Department will also hold public informational meetings in Vermont regarding the project.  According to the EIS, TDI New England expects permitting will continue through mid-2016, with construction and in-service dates as early as 2018 and 2019 respectively.

Meanwhile, TDI is simultaneously pursuing other HVDC transmission lines from Canada into the Northeastern US, most notably the Champlain-Hudson Power Express -- another HVDC line beneath Lake Champlain but continuing on overland and under the Hudson River to a converter station in New York City.   The Champlain-Hudson Power Express won a Presidential Permit in 2014.

Champlain Hudson Power Express gets Army Corps permit

The Champlain Hudson Power Express, an electric transmission line proposed from Quebec to New York, has completed its federal permitting process according to project developer Transmission Developers Inc.

Project developer TDI is a Blackstone portfolio company, with an apparent focus on HVDC lines.  First proposed in 2008, the current incarnation of the Champlain Hudson Power Express is a 333-mile high voltage direct current (HVDC) transmission line to be installed underground and underwater, from the U.S.-Canada border to New York City, running down Lake Champlain and parts of the Hudson River.  The line is slated to be able to import up to 1,000 megawatts of power from Canada to the U.S. 

In a press release issued last month, TDI announced that the U.S. Army Corps of Engineers has issued a permit that allows the Champlain Hudson Power Express project to be placed in waters of the United States along its proposed route.  The permit authorizes TDI to construct the project pursuant to Section 10 of the Rivers and Harbors Act and Section 404 of the Clean Water Act.

According to TDI, the Army Corps permit represents the final federal or state permit necessary to begin construction.  According to the permit, the work authorized must be completed by December 30, 2019.

US Presidential Permits for cross-border infrastructure

As the U.S.'s international trade in energy grows, so too has interest in the process for securing a federally required approval known as a Presidential Permit.

A marker shows the route of a natural gas pipeline in Utah.

The construction, operation, and maintenance of infrastructure that crosses the U.S.'s border with Mexico or Canada -- think pipelines, transmission lines, and bridges -- generally requires prior authorization by the federal government in the form of a Presidential Permit.  How you obtain a Presidential Permit depends on the type of facilities in question, as permits may be issued by several federal agencies under different legal authorities.

Presidential permits for oil, petroleum products, and other liquids pipelines have been issued by the U.S. State Department since since the promulgation of Executive Order 11423 in 1968.  Executive Order 11423 provided that, except with respect to cross-border permits for electric energy facilities, natural gas facilities, and submarine facilities:

The Secretary of State is hereby designated and empowered to receive all applications for permits for the construction, connection, operation, or maintenance, at the borders of the United States, of: (i) pipelines, conveyor belts, and similar facilities for the exportation or importation of petroleum, petroleum products, coal, minerals, or other products to or from a foreign country; (ii) facilities for the exportation or importation of water or sewage to or from a foreign country; (iii) monorails, aerial cable cars, aerial tramways and similar facilities for the transportation of persons or things, or both, to or from a foreign country; and (iv) bridges, to the extent that congressional authorization is not required.

The State Department's Bureau of Energy Resources Office of Energy Diplomacy receives and processes permit applications for liquid product pipelines, including water and petroleum products.  The standard by which the Secretary of State reviews applications for presidential permits is prescribed by an executive order issued in 2004.  Executive Order 13337 directs the Secretary of State to authorize those border crossing facilities that the Secretary has determined would “serve the national interest."

By contrast, cross-border natural gas pipelines are regulated by the Federal Energy Regulatory Commission, while electric transmission infrastructure is regulated by the Department of Energy.  Section 3 of the Natural Gas Act requires any person desiring to export any natural gas from the United States to a foreign country or to import any natural gas from a foreign country to the United States to obtain an order from the Federal Power Commission authorizing it to do so.   Section 202(e) of the Federal Power Act requires any person desiring to transmit any electric energy from the United States to a foreign country to obtain an order from the Federal Power Commission authorizing it to do so.

Executive Order 10485 designated the FERC's predecessor agency, the Federal Power Commission, to receive applications for natural gas and electricity facilities.  When the Department of Energy Organization Act of 1977 eliminated the Federal Power Commission, it shifted most of the FPC's responsibilities to the FERC, but Section 402(f) of that act specifically reserved import/export permitting functions for the Department of Energy.  For facilities governed by the Department of Energy, the Presidential Permit process is governed by Part 205 of the Department's rules.  In 2006, the Department delegated its authority to issue Presidential Permits for natural gas pipeline border crossings to FERC, via DOE Delegation Order No. 00-004.00A.

Infrastructure projects subject to the Presidential Permit process range widely in type, scope, and controversy, from the proposed Keystone XL oil pipeline from Canada to the proposed Champlain Hudson Express high-voltage direct current electric transmission line.

Feds approve Quebec-to-NY power line

A proposed electric transmission line connecting Quebec to New York will receive a key federal approval, according to the U.S. Department of Energy.  The Energy Department's decision to issue a Presidential permit to Champlain Hudson Power Express, Inc. focuses attention on the nation's international trade in electricity, and may suggest increased reliance on power imports.

Pursuant to two Executive Orders -- EO 10485 (September 9, 1953), as amended by EO 12038 (February 7, 1978) -- no electricity transmission facilities may be constructed, operated, maintained, or connected at the U.S. border without first obtaining a Presidential permit from the Department of Energy.  In 2010, Champlain Hudson Power Express, Inc. applied to DOE for a Presidential permit to construct, operate, maintain, and connect a 1,000-megawatt (MW), high-voltage direct current (HVDC) merchant electric power transmission system across the U.S./Canada border.

As currently envisioned, the Champlain Hudson Power Express project would cross the U.S./Canada border near the town of Champlain in northeastern New York State.  From there, the line would extend southward about 336 miles to the Consolidated Edison Company of New York, Inc. Rainey substation in Queens, New York.  Notably, the aquatic portions of the transmission line would primarily be buried in sediments of Lake Champlain and the Hudson, Harlem, and East rivers, while the terrestrial portions of the line would be buried within existing roadway and railroad rights-of-way.

The Department may issue or amend a permit if it determines that the permit is in the public interest and after obtaining favorable recommendations from the U.S. Departments of State and Defense.  In making this determination, DOE considers factors including the proposed project's potential impacts on the environment and electricity reliability.

In the case of the Champlain Hudson Power Express, the Department of Energy's record of decision states that its decision to grant the Presidential permit was based on "consideration of the potential environmental impacts, impacts on the reliability of the U.S. electric power supply system under normal and contingency conditions, and the favorable recommendations of the U.S. Departments of State and Defense."  With the Presidential permit in hand, the project developer will be one step closer to success -- but additional steps remain, including both securing regulatory approvals and completing the commercial arrangements necessary for project development.

If the project is built, New York consumers may soon have increased access to electricity generated from Canadian hydropower and other resources across their northern border.  Will the U.S. soon import more power from Canada?  If so, how much, and at what cost?  How will market forces and regulatory agendas combine to affect Canadian exports of electricity to the U.S.?

New England Clean Power Link proposed

A developer of electric transmission lines has proposed a new line that would connect New England to Quebec.  The so-called New England Clean Power Link would run about 150 miles from the U.S.-Canadian border to Ludlow, Vermont.  While the line shares some features with other proposed ties to the Canadian power grid -- including its development team -- the New England Clean Power Link differs from prior proposals in several regards.

Demand for electricity in the northeastern United States, and in particular for renewable power, has led to interest in developing several transmission lines to Canada.  Provincial crown corporation Hydro-Quebec has many large hydroelectric dams, and continues to develop Quebec's rivers for power production.  Meanwhile, Newfoundland utility Nalcor is developing gigawatt-scale hydropower on the Churchill River in Labrador, with aims to export the power to eastern Canada and the U.S.

This relative surplus of Canadian hydropower has led developers to propose transmission lines connecting Quebec resources to New England consumers.  These lines include the Champlain-Hudson Power Express from Canada to New York City, and the Northern Pass from Canada into New Hampshire.

The $1.2 billion Clean Power Link would have a capacity of 1,000 megawatts, roughly equal to the size of a nuclear power plant.  Like previous proposals, the newly-proposed line is motivated by the perceived opportunity to sell Canadian power in New England.  The Clean Power Link also shares features in common with other proposals, in that it would be a high-voltage direct current or HVDC line.  Notably, it would also be developed and financed by TDI New England, a Blackstone Group subsidiary led by the team behind the Champlain-Hudson Power Express.

Like that line, it would run about 100 miles under Vermont's Lake Champlain.  South of the lake, the Clean Power Link proposal features lines buried underground.  This contrasts with the Northern Pass, whose traditional wires-on-towers architecture has drawn significant opposition in New Hampshire.

The Clean Power Link faces a regulatory process including environmental and energy permitting, and is also dependent on the market forces that motivated its proposal.  It is unclear whether any of the proposed transmission lines to Canada will actually be built, let alone which one.  For now, TDI aims to build the line and place it in service by 2019.

Champlain Hudson Power Express debated

As policymakers seek to secure energy supplies for the future, how far abroad should they cast their nets?  In addition to cost, reliability, and energy mix goals like renewable electricity standards, should decisions be made based on other factors such as local economic development?

New York legislators debated these questions yesterday in hearings over a proposed transmission line that would connect New York City to Canadian hydroelectric generation.  The $2.2 billion high-voltage direct current line, known as the Champlain Hudson Power Express, would run from the U.S.-Canadian border to the New York metro area. The line would run underwater through Lake Champlain, the Hudson River, and East River for much of its route, with the remainder of the line buried underground.

The Champlain Hudson Power Express was first proposed in 2010, and has been the subject of controversy.  New York Governor Andrew Cuomo has launched the N.Y. Energy Highway program, a public-private initiative to upgrade and modernize New York State’s energy system.  The Champlain Hudson Power Express's developer, Blackstone Group, L.P. subsidiary Transmission Developers Inc., is promoting the line as part of that solution.  It would connect over 1,000 megawatts of Canadian generation - primarily Hydro-Quebec's hydropower projects, as well as some wind - to power-hungry consumers in the New York City area.

Some stakeholders question the effects of the line on existing and new generation in New York.  Older domestic power plants may be unable to compete with the Canadian power; if imports are priced just below what domestic generation needs to operate, the result could be a loss of jobs and tax revenues without significant consumer savings.  Stakeholders such as the International Brotherhood of Electrical Workers Local 97, representing more than 4,000 workers in electric generation and utility jobs in New York, have publicly opposed the project on these grounds, while calling for growth of domestic generation projects.

The Canadian power might also compete with existing and proposed indigenous renewable power projects.  New York has adopted a renewable portfolio standard of obtaining 30 percent of its electricity from renewable sources by 2015.  New York currently excludes large-scale hydropower projects from qualification for its RPS, but Canadian imports could dampen market demand for in-state renewable generation.

The Champlain Hudson Power Express reportedly featured prominently in a public hearing held yesterday by the New York Senate Standing Committee on Energy and Telecommunications to "consider and analyze the long-term base load energy generation and transmission needs of the State of New York".  Debate over the proposed line is likely to continue, with economics and regulation likely to play key roles in its fate.