June 27, 2011 | last updated May 31, 2012 7:17 pm

Power generators: Hydro savings aren't a given

The claim that the Northern Pass transmission line will bring in low-cost hydroelectric power resulting in big savings for New England ratepayers is unsubstantiated, said the regional power generators who oppose the project.

In building the Canada-to-New Hampshire transmission line, Hartford-based Northeast Utilities and Boston-based NStar have said the low-cost hydropower will result in $206 million in savings to the regional power grid in the line's first year of service. Those savings on the power provided by Hydro-Quebec will grow to $327 million by 2024. Those claims come from a report produced by Boston consultant Charles River Associates.

The New England Power Generators Association Inc. — which represents regional power providers such as Dominion, NRG Energy, and Entergy — said any reported cost-savings are based on the unreliable claim that the power coming from Canada will be cheaper than the regional wholesale price of electricity.

Hydro-Quebec "is presenting itself as a presumptive low-cost provider. This claim is simply unsubstantiated," said Sandi Hennequin, vice president of the New England Power Generators Association Inc. "We do not have any information on the actual price of (Hydro-Quebec) electricity under any potential contract."

Regional electric grid administrator ISO New England only contracts with enough power suppliers to meet demand at any given moment. For New England ratepayers to save from the Northern Pass project, Hydro-Quebec will have to sell its 1,200 megawatts of electricity for less than what other power generators are offering.

This shouldn't be a problem for Hydro-Quebec since hydropower is far cheaper to produce than other sources of generation such as natural gas; but — as Hennequin points out — this is not a given.

There are also other costs to consider, Hennequin said. Connecticut Gov. Dannel Malloy wants energy policy that creates jobs, and Northern Pass reduces the need for power plant employees in the state.

"Our current Connecticut companies provide over 1,800 well-paying Connecticut jobs and pay nearly $38 million in state and local taxes," Hennequin said.

If Hydro-Quebec's power pushes out higher-cost power generators or lowers the average wholesale price, the ability of Connecticut companies to provide those jobs will be reduced, Hennequin said.

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