Posts Tagged ‘65 year contract’

Beware NP, Hydro Quebec’s Way of Going

March 23, 2017

To understand reservations New Hampshire people have for Hydro Quebec/Eversource’s Northern Pass on our health, we need to know the story of Hydro Quebec’s takeover of Hydro power in Labrador at Churchill Falls. See “The Churchill Falls Contract and why Newfoundlanders can’t get over it” by James P. Feehan, Melvin Baker, 9/1/2010.

Here’s the history: Quebec was uncomfortable when Labrador’s water rights were established in 1927, and would not allow Labrador hydropower to be transmitted across Quebec territory to markets in Ontario or the US.

In 1958, the British Newfoundland Corp. (BRINCO) received extensive land and water rights to Newfoundland and Labrador and created the Hamilton Falls Power Co (HFPCo), later renamed Churchill Falls Labrador Corp. (CFLCo) as a federally incorporated subsidiary. The Shawinigan Engineering Co. bought a 20 percent interest.

In 1962, the Quebec government decided to nationalize all privately-owned electricity generating companies in the province. As a result, Shawingan Engineering’s 20 percent stake became the property of Hydro Quebec.  Later, HQ drew up a pivotal contract with CFLCo to snag Churchill Falls.

How? Here is the HQ 65 year Contract, agreed to through a corrupt political finesse in 1976 as follows:  From 1976-2016: CFLCo would sell to Hydro Quebec approximately 31 billion MWh/year for a period of 40 years. The price would be 3 mills (3 tenths of a cent) per KWh for the first 5 years, then decline to 2.5 mills for the last 15 years. At the end of 40 years, the contract would “automatically” be renewed for 25 years at 2 mills/KWh.

In 1974, the Quebec government purchased BRINCo’s  65.8  percent of shares. All attempts to renegotiate the contract’s terms failed as energy prices escalated in the 70s and CFLCo had increasing difficulty funding the CF generating station. Hydro Quebec turned a titanic profit on the deal.

2016-2041 – When the contract was renewed at 2 mills (2 tenths of a cent) per KWh for 25 more years, Hydro Quebec could resell its energy for 85 mills (8.5 cents) per KWh.

It does not take rocket science to recognize how HydroQuebec makes its money. Or how ruthless is its way of going within the province it shares with Newfoundland. Or how senseless NH would be to allow HQ to cross New Hampshire territory to markets in MA and NY.

The new HQ moneymaker would be to strap New Hampshire with the albatross of the Northern Pass and stifle further development of clean energy such as solar and yet to be developed other forms of bona fide renewable energy. New forms of energy could potentially save our forests, our culture, our watersheds, our wildlife, our tourist industry, our real estate, our lives.

Please read and consider the following link and mark your calendar: https://manchesterinklink.com/northern-pass-foes-plan-circle-state-house-april-23

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