Long-distance transmission of Canadian hydropower is a cost-effective complement to U.S. renewable energy transitions

October 13, 2020

Department of Population Health Sciences faculty member and Global Change Center affiliate Ryan Calder released today a policy report evaluating economic and environmental costs and benefits of diverse scenarios for renewable energy transitions for the New York City Area. The report found that a proposed long-distance transmission line, the Champlain-Hudson Power Express, would likely pay for itself in terms of avoided direct and environmental costs.

Long-distance transmission lines could bring hydropower generated in Canada to markets in the US. These projects have large upfront costs, but the study demonstrates that these costs are lower than those for wind and solar.

While New York State has ample renewable energy resources, these are concentrated Upstate. Statewide demand is driven by the New York City area where fossil fuel generation predominates. While New York State has recently pledged to decarbonize its electricity sector by 2040, this has been complicated by the early closure of Indian Point Energy Center, a nuclear power plant roughly 40 miles north of New York City.

Calder and colleagues at Duke University’s Department of Civil and Environmental Engineering, Mark Borsuk and Celine Robinson, undertook a comprehensive assessment of the options available to replace generation supplied by Indian Point, which will be fully decommissioned in 2021.

Proposed Champlain Hudson Power Express Route. Image credit: chpexpress.com

The study assembled all publicly available information on environmental and direct costs and benefits for the relevant technological options (including existing legacy generators) and modeled a variety of scenarios using probabilistic simulation. Options evaluated include no action, development of a new gas plant, development of long-distance transmission from Canada and build-out of local wind and solar.

Indian Point will likely accrue roughly $17 billion in costs associated with increased output of legacy fossil fuel generators. While long-distance transmission represents an upfront investment of upwards of $3.7 billion, savings in direct and environmental costs more than outweigh this such that total costs are more than $4 billion less than no action. When paired with planned build-out of solar and wind projects, savings of long-distance transmission rise to more than $10 billion, driven in part by greenhouse gas emissions that are avoided during the many years of buildout of offshore wind.

Quantified environmental impacts include emissions of greenhouse gases and criteria air pollutants. Economic values were calculated for both of these endpoints for each of the energy scenarios evaluated. Both long-distance hydropower transmission and development of wind and solar have large climate and local air pollution benefits. Long-distance transmission of hydropower avoids roughly 100 million tonnes of CO2 equivalents by 2050 (economic value of approximately $4.5 billion) and thousands of tonnes per year of diverse air pollutants (economic value of approximately $100 million).

Indian Point Energy Center, located on the Hudson River, is scheduled for decommission in 2021.

The study also quantified likely local economic activity associated with different energy scenarios. All energy investments are likely to stimulate on the order of billions of dollars of economic output and thousands of jobs. Long-distance hydropower would likely generate over 5,000 job-years, while development of offshore wind would likely generate over 25,000 job-years.

The report will be published by the Nicholas Institute of Environmental Policy Solutions at Duke University. An advance copy has been made available by the authors on ResearchGate.

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