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Hydro-Québec has begun exporting electricity to New York City under a long-term contract that critics say comes at an awkward time, as Quebec grapples with growing demand at home and lower-than-usual reservoir levels.
The Crown corporation officially activated its new transmission line June 1 and has committed to delivering 10.4 terawatt-hours of electricity annually to New York City — more than the entire output of Quebec’s La Romaine hydroelectric complex — from its Hertel post in La Prairie, Que.
At the National Assembly earlier this month, Parti Québécois energy critic Pascal Paradis questioned the wisdom of exporting electricity while Hydro-Québec has warned of tighter supply conditions.
“Let’s summarize: the reservoirs are empty, and we’ve been handing out our electricity blocks left and right,” Paradis said. “Hydro-Québec says, ‘I’m going to import electricity from the United States so I can sell electricity to the United States at a high price.'”
Economy, Innovation and Energy Minister Bernard Drainville said he trusts Hydro-Québec to properly manage its energy reserves.
He said the situation underscores the importance of improving energy efficiency and developing new sources of electricity.
The export agreement comes as Hydro-Québec is managing some of its lowest energy reserves in decades after several years of below-average precipitation in northern Quebec.
Radio-Canada recently reported that Hydro-Québec expects to declare energy stocks of 86 terawatt-hours (TWh) in 2026, down from 91 TWh in 2025 and 97 TWh in 2024. The utility has previously indicated it is comfortable operating with reserves above 100 TWh.
Increase in electricity demand
The Hertel‑New York interconnection line project aims to supply clean, renewable energy to New York City, according to the utility’s website. In Quebec, the line is 57.7 kilometres long, with 56.1 of that underground and the rest underwater.
Experts say the situation reflects not only drier conditions but also a rapid increase in electricity demand as Quebec pursues economic development and electrification initiatives.
Pierre-Olivier Pineau, an energy policy professor at HEC Montréal, said the export agreement remains a good deal despite the tighter constraints facing Hydro-Québec.
“I was really pleased. I thought it was a very good contract for Hydro-Québec, for New York, for decarbonization,” Pineau said. “I still think the benefits of the contract are much greater than what the constraints represent.”
He said lower water inflows in recent years and faster-than-expected growth in Quebec’s electricity demand have made the annual export commitment more challenging than when the agreement was reached.
Even so, Pineau said Hydro-Québec has sufficient flexibility to manage the contract without directly affecting consumer electricity rates, although broader pressures on the system could contribute to future increases.
Hydro-Québec puts province first
Hydro-Québec spokesperson Lynn St-Laurent said meeting Quebec’s electricity needs continues to take precedence.
“There’s one thing that needs to be very clear: Quebec’s electricity needs remain the priority,” she said.
St-Laurent said the new line gives Hydro-Québec additional flexibility because it is bidirectional, allowing electricity to flow both to and from neighbouring markets.
The utility can import electricity when prices are favourable and conserve water in its reservoirs, then increase exports when demand and prices rise elsewhere, she said.
The transmission line, which Hydro-Québec says is the longest underground and underwater high-voltage direct current line in North America, was ready by mid-May after roughly a decade of work.
The project also includes an ownership agreement with Kahnawà:ke, whose territory the line crosses southwest of Montreal.
Grand Chief Cody Diabo said the community is in the process of acquiring a 49-per-cent ownership stake in the line after being offered between 10 and 49 per cent participation.
“It definitely was a step in the right direction towards true reconciliation and working together,” Diabo said. “The community needed to see a benefit for going through our territory.”
Diabo said he hopes the arrangement encourages other Indigenous communities to seek similar partnerships on projects affecting their traditional territories.
Hydro-Québec estimates electricity sales under the New York agreement will generate about $34 billion US in revenue over the life of the contract.
St-Laurent said the project positions Quebec as an important player in North America’s energy transition by linking its hydroelectric system directly with one of the continent’s largest urban centres.