Canadian hydro groups seek credit for US CO2 rule

The US Environmental Protection Agency (EPA) should better credit the low-carbon electricity imported from Canadian hydroelectric plants in its proposed Clean Power Plan, utility officials from Canada and Minnesota said today.

The utilities say imported hydropower could play a key role in helping US states achieve the emission targets in the proposed rule, displacing carbon-intensive coal generation with a resource that has no direct emissions of CO2. Another benefit of hydropower is storing large amounts of energy that can be quickly dispatched, helping integrate growing amounts of wind generation in the US.

Canada derives about 60pc of its electricity generation from hydropower and is adding more, with about 4,000MW under or nearing construction and 7,000MW more in early stages of development. But it is unclear if imported hydropower could count toward meeting the CO2 targets in the Clean Power Plan.

EPA has not said how it plans to treat imported hydro but has taken public comments on the issue. The agency declined to comment further on the issue today.

Minnesota Power executive vice president David McMillan said it was "vital" that EPA provide enough credit for renewable energy imported across state lines, as states might find the cheapest way to cut CO2 could be from distant renewable projects. He spoke today in Washington, DC, at a Wilson Center event highlighting the role Canadian hydro could have in the Clean Power Plan.

The Minnesota utility has proposed building the 500kV Great Northern transmission line that would run from the northern part of the state to Canada. The line would provide 883MW of capacity and import 383MW of hydro from the province-owned utility Manitoba Hydro, which expects it could develop about 5,000MW more hydroelectric capacity.

EPA could decide to treat hydro that crosses international borders the same way it plans to treats new hydro that crosses state borders by crediting its zero-carbon energy, Center for Climate and Energy Solutions senior fellow Kyle Aarons said.

Another option would be for EPA to provide no credit for hydro imported from Canada, though Aarons said this would be difficult to justify. Aarons' policy think tank released a study today about the role Canadian hydropower could have in the Clean Power Plan that was funded by the electric and hydropower industries in Canada.

Given the 10-year lead time it typically takes to develop a large hydroelectric project, Manitoba Power power sales division manager Andrew Cormie said that work needed to begin soon to count toward the final deadlines for emission targets in the Clean Power Plan.

"If you just think about 2030, we are running out of time," Cormie said.

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