Referendum in US deals blow to Hydro-Qubec

Democrats weren't the only losers in elections held Tuesday in the U.S. So was a Canadian-led energy project, rejected by voters in one state referendum.

This spurned project doesn't involve oil, or pipelines, or Western Canada.

It involves a Hydro-Québec corridor to New England â€" and now its future is in doubt.

Voters in Maine voted about 60-40 to halt construction of the project and force its backers to obtain two-thirds support in the state legislature if they want to complete it. 

That's after the most expensive referendum campaign in state history, where ads for and against the plan lined highways and bombarded television viewers.

Legal fights are likely. 

The line is already being built and worth billions of dollars to the Quebec public utility and to its American partners. 

But on Tuesday night, project opponents hugged and cheered. At a party held amid fire pits at an outdoor beer garden in Farmington, they demanded a pause on ongoing work while state politicians weigh their response. 

"We're going to certainly be demanding that they stop construction right away," said Sandi Howard, a teacher who organized opponents against the project.

"If they're wanting to take that financial risk [of building], that's on them. This is a strong message to them that we really don't want this project."

Opponents viewed the project as providing too little benefit considering the damage to their state's forests; they accused two foreign corporations, Hydro-Québec and its partner, the Spanish-owned Central Maine Power, of using their state as a conduit to the project's main customer, Massachusetts.

Opponents of the Hydro-Québec/Central Maine Power line through Maine celebrate their referendum win at an outdoor party in Farmington, Me., on Tuesday. (Alexander Panetta/CBC News)

Known as the New England Clean Energy Corridor, the 233-kilometre project would cut a new path down through northern Maine and increase Hydro-Québec's energy exports to the U.S. by roughly one-third by connecting to an existing line on its way to Massachusetts.

It is projected to generate $10 billion US for Hydro Quebec over 20 years.

Yet it crashed into clamorous resistance along the route from a consortium of unlikely allies â€" just as it had in an earlier ill-fated effort to cross New Hampshire.

That unusual alliance seeking to stymie the project included nature-lovers and fossil fuel companies, which funded the campaign against their common hydroelectric foe.

The project would cut a new path from the Quebec border through 85 kilometres of Maine's forest, before widening an existing hydro route for another 148 kilometres and connecting to the grid. (Sködt McNalty/CBC)

So now, in a week where world leaders are gathering to discuss climate change, a project that promised major emissions reductions is in severe peril.

The Maine Public Utilities Commission had said this project would reduce greenhouse gas emissions by up to 3.6 million metric tons per year, or the equivalent of removing about 700,000 cars from the road.

Tuesday's referendum occurred alongside a limited number of elections held across U.S. cities and states in odd-numbered years â€" votes often seen as an early gauge of the political landscape ahead of next year's congressional midterms.

But this hydro campaign in Maine was not a standard partisan story about Democrats versus Republicans.

Tucker Carlson teams up with greens

On one side, Hydro-Québec and Massachusetts had the support of the Biden administration in Washington, which touted the potential green benefits of the project.

The government of Maine also supports the project, which not only promises revenue for the partner-utility, Central Maine Power, but its conditions included cash to Maine for broadband Internet, home retrofits and electric vehicle-charging stations.

Drone of Maine hydro project11 hours agoCutting of the forest path is well underway, as seen from this drone footage shot in June at Johnson Mountain, Maine, and supplied by project opponents with the Courtesy of Yes on 1 campaign. 0:50

On the other side, people worried about the damage to forests found themselves aligned with fossil fuel companies and Fox News host Tucker Carlson, who devoted a segment to hammering the project as a "green energy scam."

In a financial slugfest of campaign funding, public spending documents show Hydro-Québec and its allies outspent opponents, doling out more than $50 million US through political committees.

The <a href="https://twitter.com/NECEC_ME?ref_src=twsrc%5Etfw">@NECEC_ME</a> transmission line will bring clean energy to New England and reduce carbon emissions equivalent to taking 700k cars off the road. I hope Mainers vote NO on ONE to keep this project moving and reliable, affordable, <a href="https://twitter.com/hashtag/CleanEnergy?src=hash&amp;ref_src=twsrc%5Etfw">#CleanEnergy</a> flowing!<br> <br>Here's what's at stake ðŸ'‡1/3 <a href="https://t.co/Cl2DFmbPa9">pic.twitter.com/Cl2DFmbPa9</a>

&mdash;@SecGranholm

Companies with fossil fuel interests â€" competitors to Hydro-Québec â€" bankrolled the biggest opposition group; opponents spent some $26 million US, led by a company with an oil-fired power plant near Portland, a natural gas and geothermal company, and a coal, natural gas and renewables company.

"It's made for some really odd bedfellows," said Lincoln Jeffers, the economic and community development director of Lewiston, Maine.

Potential revenue loss for one town

Lewiston is filled with French-Canadian descendents and stands to financially benefit more than most from the project.

It's the site of a planned converter station whose construction is already underway and which has already begun contributing to the municipal tax base.

As a result, the municipality has been able to cut taxes for residents and Jeffers estimates the project will ultimately expand municipal revenues by around 12 per cent.

"That's not chump change," he said.

That new revenue would help the working-class community of old mills and textile plants further lower property taxes or improve services, Jeffers said.

Project supporter Lincoln Jeffers13 hours agoLincoln Jeffers, the economic director for Lewiston, Maine, says the Hydro-Québec project would be great for his town’s finances and more importantly for the planet. 2:46

But he said his main motivation for supporting the project wasn't even financial: It was environmental.

"This is the right thing to do. We need to quit burning fossil fuels. We need to clean up the air.… You're spilling water, unused, out of dams up in Canada. So if we can displace fossil fuel generation with this project, it's better not only for Maine, Lewiston, but the planet."

In the end, voters in Lewiston mostly sided against the project.

The opponents

Fly-fishing guide Todd Towle said he worries about the trout streams zig-zagging through that route and about the deer that herd there in the winter.

He became a staunch opponent after attending a public meeting hosted by the Central Maine Power utility two years ago; he said he left unimpressed by the reassurances he heard.

"I'm afraid that we're going to lose not only habitat â€" which is key to trout sustainability â€" but the visual scarring off this is going to be immense," he said. 

"This is going to be a turnpike-sized strip in the middle of the largest unbroken forest in the eastern U.S."

Signs denouncing a Hydro-Québec project as a 'foreign invasion' are shown on a property near Bingham, Maine. (Alexander Panetta/CBC)

Rodney Porter, a 79-year-old from New Sharon, Maine, recalls coming to northern Maine every year for decades, sneaking down to a river with his brother without their parents' permission.

Now he worries that the sight of hydro lines will change the landscape. "It just cuts a swath right through the middle of it," he said.

In a cabin in the woods, nearly 20 kilometres from any tarred road, Sally Kwan and her husband Duane Hanson lead a largely self-sufficient life; their neighbours include moose, deer, bears and birds.

They first learned of the energy project when they saw surveyors placing pins on the route near their house.

"This is a place where people come to get away from modern life," Hanson said.

Days before Tuesday's referendum, he was annoyed he could still hear the sound of trees being cut despite the impending vote â€" and the ongoing legal battles.

Towle, a fishing guide and photographer, is a staunch opponent of the hydro project because he says the damage to the region is too great. (Alexander Panetta/CBC)

"They keep cutting this thing â€" like they're gonna make it happen.… That's what makes it hard to stomach.… That these foreign corporations can just come here," Hanson said.

"They're just gonna shove it down everyone's throat."

Stewing at 'foreign corporations'

This opposition was bred in a climate of existing distrust of the local power utility, purchased by Spanish giant Iberdrola in 2007.  

Views on Central Maine Power here are essentially the opposite of the prevailing public sentiment in Quebec, where Hydro-Québec is cast as a symbol of nationalist pride, built by leaders like René Lévesque and Jean Lesage.

A sign on a storage shed near Bingham, Maine, protests the Hydro-Québec-led project. (Alexander Panetta/CBC)

For three years in a row, Central Maine Power has been listed in a national survey as the worst electric utility in the United States in terms of customer satisfaction.

Towle resents that a Quebec-owned company is partnering with a Spanish-owned company to carve into the treasured U.S. landscape where he earns his living.

"I think it'd be a totally different animal if it was just a true American project. You know what I mean â€" with American jobs and American profit. But it's not," he said.

"We're getting snowballed by foreign corporations."

Since being nationalized in 1962 by then-minister René Lévesque, centre, and premier Jean Lesage, left, Hydro-Québec has been regarded as a symbol of provincial pride. (Hydro-Québec) What's next: Odds mount against project

The referendum piles an additional layer of uncertainty onto existing legal hurdles. In August, a Maine judge ruled that the project lacked authority to cross a 1.6-kilometre stretch of public land. 

The reason is a clause in the state constitution that says public land cannot be substantially altered without a two-thirds vote in both houses of the legislature.

Signs outside Farmington, Maine, in support of the Hydro-Québec-led project. (Alexander Panetta/CBC)

A final ruling is expected in Maine's state-level Supreme Court next spring. 

Before the vote, Hydro-Québec said in an email that construction was proceeding. It said it would take the time to assess the vote outcome before determining its next move.

The utility and its allies have also been pushing back on one argument popping up among opponents: Hydro power is not as low carbon as advertised.

Project supporters say that flies in the face of other evidence â€" such as Quebec having the lowest greenhouse gas emissions per capita in Canada.

Both sides called each other's messaging misleading. Supporters of the line sent different messages to Republican voters, left, and Democratic voters, right, making different claims about the consequences of a referendum with retroactive application. (Adam Cote)

Eyes will now turn to state politicians.

Barring any legal challenges, the state government has 30 days to certify then proclaim the results; then it becomes law 30 days later.

That would turn the issue over to the legislature in early January. And according to the results, lawmakers would have to approve the project by two-thirds in both legislative chambers, as prescribed in the court decision.

Current and former politicians fighting the line say they're now confident they'll beat it.

Richard Bennett, a Maine state senator and former leader of the state Senate, says the project already had lacklustre support before the vote.

Project opponents including Sandi Howard, right, and Rodney Porter, centre, celebrated the result at the outdoor party in Farmington. (Alexander Panetta/CBC News)

This year he introduced a motion calling its permit unconstitutional and only 6 of 34 colleagues voted with the project.

"I'm guessing there's very little chance [Central Maine Power] can convince the legislature to vote two-thirds," the Republican said at the outdoor party Tuesday.

"Based on my conversations with people across the aisle, of all political persuasions in the Maine legislature, House and Senate, I think it would be a very, very tough row for them. Particularly after the people of Maine have spoken loudly." 

Another well-known former politician working with project opponents said anyone supporting the line now risks career suicide. 

"I would be very cautious if I was a legislator saying, 'I know my home district voted 60-40 against this corridor but I'm going to vote for CMP,'" said Kenneth Fredette, a former Republican leader in the state House of Representatives.

"They're putting their jobs on the line at that point."

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