By Guy Page
Ever since Vermont signed its first power contract with Quebec in 1987, its critics have wondered if tensions between Canada and the U.S. might ever threaten the flow of carbon-free, low-cost electricity.
Until recently, such differences with our neighbors to the north were considered highly speculative. However, on February 28, Quebec Premiere Francois Legault, said cutting off Hydro-Quebec electricity to the U.S. is an option if U.S. tariffs on Quebec goods continue.
Legault wrote on X February 28: “And if Mr. Trump implements tariffs, we [with Ontario Premier Doug Ford] do not rule out joint retaliation on, among other things, electricity exported to the United States.”
Ford has explicitly promised to cut off Ontario electricity exports to New York, Minnesota and Michigan if the tariffs proceed.
Legault did not single out Vermont’s power contract, H.Q.’s only long-running fixed-term deal with a U.S. state. The rest of H.Q.’s U.S. power sales are sold on the “spot market,” where prices vary according to supply and demand. Two new contracts with Massachusetts and New York could be cancelled if the tariffs continue.
According to Hydro-Québec, the Canadian electricity provider is connected to the Vermont grid via an approximately 24-km (15-mile), 120-kV transmission line that runs from Bedford substation in Québec’s Montérégie region to Highgate substation in the northwest corner of Vermont. The interconnection also includes a back-to-back converter station to synchronize Hydro-Québec’s energy deliveries with the New England grid. With a maximum capacity of 225 MW, the interconnection was commissioned in 1985, enabling Hydro-Québec to supply Vermont utilities under long-term agreements.
The first long-term contract between Hydro-Québec and Vermont was signed in 1987. In 2010, the parties signed a second contract for up to 225 MW, under which Hydro-Québec committed to deliver approximately 1.3 TWh of energy each year through 2038—a volume equivalent to about 25% of Vermont’s annual electricity needs, H.Q. says.
“Designed to stabilize prices, these long-term contracts are part of the reason why Vermont consumers have not experienced the sharp rate increases that have occurred in other parts of New England in recent years,” H.Q. said.
According to the Globe & Mail report, Quebec Premier Francois Legault said the power restrictions aren’t imminent, but are being weighed among its options. Quebec is also considering legal options for breaking new, as-yet-unimplemented contracts to deliver power to Massachusetts and New York.
While stopping short of threatening a cutoff of electricity, the chief executive of Hydro Quebec suggested the price of energy exports to the U.S. may rise in response to tariffs.
Hydro-Québec chief executive Michael Sabia, who said in a February 19 speech in Montreal that the current administration in Washington, D.C. is a “bully” that must be met “rate to rate.”
“Short-term: In March, we will most likely face tariffs on steel and aluminum. And possibly generalized rates of 25%. Let’s be clear, we are at the beginning of an inevitable and potentially very long [negotiation]. The actions we are taking now set the stage for this negotiation. The only way to negotiate is from a position of strength. Especially when faced with a bully. And the president of the United States is a bully. [We] must show that we are ready to stand up, rate for rate. Strength: this is what people in Washington understand.”