Hydro-Québec buying U.S. company Great River Hydro for $2B US

A subsidiary of Hydro-Québec has signed a deal to buy U.S. power generator Great River Hydro LLC for $2 billion US — the Crown corporation's largest acquisition since its founding in 1944. 

The U.S. company owns 13 hydropower generating stations with a total installed capacity of 589 megawatts along the Connecticut and Deerfield rivers in Vermont, New Hampshire and Massachusetts.

The assets supply enough energy to power more than 213,000 homes in New England.

"These are high quality assets, and it is rare for these assets to become available on the acquisition market," said Sophie Brochu, president and CEO of Hydro-Québec, in an interview on Radio-Canada's Tout un matin Wednesday.

Brochu says the acquisition will allow Hydro-Québec to combine its know-how in the management and development of hydroelectric resources with Great River Hydro's in-depth knowledge of the New England market.

Lynn St-Laurent, a spokesperson for the provincially owned utility, says it makes "perfect sense" to be acquiring generating stations in the region. 

"We've been exporting there since the 80s and so we have a well-established partnership and it's something we want to build on," she said. 

Great River Hydro, which has approximately 100 employees, is being sold by affiliates of ArcLight Capital Partners LLC.

As Hydro-Québec wants the company to remain a separate entity, it says all jobs will be maintained, as will working conditions.

St-Laurent clarified that the stations will continue to generate energy in New England, for New England.  

"This is not energy for Quebec, this is really Hydro-Québec owning a generation asset in [the region]," she said.

Hydro-Québec is anticipating an average of $171 million US of added revenue per year should the deal go through. 

The transaction is subject to customary closing conditions, including regulatory approvals.

Strategy to revive stalled transmission line in Maine

François Bouffard, a professor of electrical engineering at McGill University, says he's not surprised by the acquisition, especially since the infrastructure is already in place. 

He says acquiring more energy companies outside of Canada— as Hydro-Québec says it is not ruling out doing — is necessary if it wants to keep growing as a company. 

"[Hydro-Quénec has] this amazing engineering and business machine that is very well oiled up and they can definitely bring in more assets, more revenue and sort of diversify their portfolio of assets around the world," said Bouffard.

But the professor also believes the purchase was a strategic move in reviving Hydro-Québec's stalled power line project through Maine.

Maine residents quashed the project after 59 per cent voted to ban the construction of the 233-kilometre hydro corridor in a referendum last November. The project, known as the New England Clean Energy Connect Transmission LLC (NECEC), has been on hold since the historic vote.

But in August, Maine's highest court breathed new life into the NECEC, ruling that the statewide vote against the project was unconstitutional.

"Probably Hydro-Québec's strategy behind this is to have a strong footing in New England to really perhaps swing the deal, to show that they're investing money in New England — not just for Quebec but for New England as a whole," said Bouffard.