Hiking Quebec energy exports to Ontario would benefit both provinces: report
Published Friday, July 11, 2014 3:39PM EDT Last Updated Friday, July 11, 2014 5:54PM EDT
Hydro Quebec power lines are shown on Oct. 29, 2009 in Levis Que. (THE CANADIAN PRESS/Jacques Boissinot)
MONTREAL -- Hiking energy exports from Quebec to Ontario would help both cash-strapped provinces, says a report released Friday by two environmental groups.
The study says increasing energy trade between the provinces could generate about $12 billion over 20 years for Quebec, while Ontario could save the same amount over the same period by cutting down on its nuclear-energy production.
The report was released by environmental groups Equiterre and the Ontario Clean Air Alliance.
It says the provinces would benefit by setting a price of 5.7 cents per kWh, nearly double what Hydro-Quebec currently earns for its electricity exports. That price, the study adds, would be lower than the estimated 8.3 cents per kWh it would cost to generate electricity from a refurbished Darlington Nuclear station.
The report states no new infrastructure would be necessary because transmission lines between the two provinces already exist.
Steven Guilbeault of Equiterre said Quebec could use the extra money to invest in infrastructure, social programs or debt reduction. Jack Gibbons of the Ontario Clean Air Alliance said Ontario could also focus on similiar priorities as well as public transit.
The Ontario government has said it's committed to generating about 50 per cent of the province's electricity from nuclear sources.
But a recent federal court ruling stalled plans to refurbish and expand the province's Darlington plant. A judge ruled the plan, in the works since 2006, fell short in its environmental assessment and ordered that it be redone.
Guilbeault believes working together would be a win-win situation for both provinces. He said he hopes a favourable political climate -- majority Liberal governments were recently elected in both provinces -- could lead to a deal.
"If we had the PQ (Parti Quebecois) in Quebec and the (Progressive) Conservatives in Ontario, I'm not sure those two parties would have wanted to enter into negotiations," Guilbeault said.
"Now, I think for both sides, there could be an interest."
Guilbeault said the suggested price structure would immediately boost Hydro-Quebec's export profits because the public utility currently sells electricity to American clients for about 3 cents per kWh.
However, a spokeswoman for Hydro-Quebec said Friday that the numbers in the report were flawed.
Marie-Elaine Deveault said energy-market prices fluctuate far more than what the study indicates. For example, she said the average price for electricity exports from January to March 2014 was 8 cents per kWh, compared to the 3 cents per kWh cited in the report.
"Of course we are always open to new business opportunities," Deveault said.
"Collaboration is already established and Hydro-Quebec will continue to speak with authorities in Ontario."
The environmental groups said they reached their recommended export price by taking a middle ground between U.S. rates and what Ontario Power Generation believes electricity will cost.
A spokeswoman for Quebec Natural Resources Minister Pierre Arcand said the province would like to increase exports. But Veronique Normandin said Friday that Arcand had yet to read the report.