Each year, the Canadian federal government lays out its policies in a parliamentary event known as the Throne Speech.
Last week, just two words in that speech set off what could be an energy revolution for the four Atlantic Canada provinces and Quebec. The words were “Atlantic Loop.” Prime Minister Justin Trudeau followed up with a more detailed explanation.
The Atlantic Loop would be a new series of electric transmission interconnections tying all five provinces together, allowing Labrador and Quebec hydropower to reach other provinces and eliminate their use of coal.
The map of the Atlantic Loop is interesting. Like all loops, it must be a closed circuit. But part of it lies outside the five provinces. The Atlantic Loop, backed by the Canadian federal government, would pass through Maine.
The project is to be financed with the Canadian federal government’s Clean Power Fund. It will give eastern Canada far more access to renewable power and increase markets for Quebec and for the costly Muskrat Falls project in Labrador.
It could promote massive new hydro in Labrador at Gull Island and help resolve a decades-long dispute between Quebec and Newfoundland-Labrador.
Hydropower would flow south to Maine, likely using the proposed new transmission line. That line would connect with the New England grid in Maine. Other lines north, from Maine to New Brunswick, would complete the Loop.
The economies of scale and the displacement of fossil fuel power by hydro could lower electric rates. Maine could get the same kind of benefits as the Atlantic provinces.
Right now, this project is in the planning stage, but the Throne Speech seems have turned it into a realistic possibility.
There are two dangers for Maine.
The first is that Hydro-Quebec and Central Maine Power’s Spanish parent will try to seize the initiative to turn economic gains to their own coffers rather than for Maine customers. There’s little reason to doubt that Hydro-Quebec will try to make itself the leader of the project.
The second is that Maine will delay in getting into the project planning and find itself facing a done deal. It might be able to wheedle some breaks, but would have had little role in shaping it for maximum state advantage.
The best way to avoid both dangers is for Maine state government to get involved now. Talks should begin with Ottawa and with the neighboring provinces. Inevitably, there will be a multi-jurisdiction committee and Maine should be a member.
Maine should be treated equally with the Canadian provincial participants, because Maine would be in exactly the same position. There is a good history of regional cooperation on electricity, so this is a reasonable expectation.
Not only could the Loop give Maine greater access to Canadian hydropower, but it would no longer be considered merely an arm’s-length U.S. market. That could bring economic advantage.
What’s more, the market for Maine-based generation using a potentially economic transmission path could boost the development and availability of renewables in Maine and economic activity here. Transmission costs for off-shore wind power from Maine might be attractive.
Ultimately, it could give Maine access to an alternative to the costly and complex ISO-New England arrangement. Maine now pays a big share of transmission costs elsewhere in the region. It’s possible the Atlantic Loop market could be simpler and less burdensome, thanks partly to government participation in capital costs. At least the Loop option could give Maine some bargaining leverage in New England.
The fate of the western Maine corridor is still unknown. If it were to happen despite strong opposition in Maine, it might be exploited as part of the Loop for the direct benefit of Mainers.
When I worked with Gov. Joe Brennan on energy policy, together we had good, direct and regular contact with the premier of Quebec and the energy minister of Canada. For Gov. Mills, these people are just a phone call away. Those are calls now worth making.
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