Paraguay looks to renegotiate Brazil energy deal

By San Francisco Chronicle


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Paraguay's new President Fernando Lugo visited Brazil with one goal: launching talks to earn his poor country more money from a dam on the nations' shared border, the largest hydroelectric project in the world.

Brazil has resisted new terms for distributing electricity and profit from the Itaipu dam, established by a 1970s-era treaty between the neighboring countries. But Lugo said Brazilian President Luiz Inacio Lula da Silva is willing to debate the issue.

"Who said you can't change a treaty?" Lugo told reporters in Sao Paulo before heading to Brasilia to meet Silva. "You can change anything when there's a will, when (the current situation) doesn't fit the challenges of the modern world."

After meeting for three hours, Lugo and Silva ordered high-ranking officials to discuss Paraguay's complaints soon. Brazilian Foreign minister Celso Amorim told reporters that Brazil won't change the terms of the treaty, but is open to "creative solutions" he did not describe in detail.

The treaty now gives each nation half the electricity the dam generates. Paraguay, whose population is less than 4 percent the size of Brazil's, sells most of its share back to Brazil for US$100 million a year — ensuring that the dam provides 20 percent of electric power consumed by Latin America's largest economy.

Lugo's leftist administration, which took office last month ending 61 years of one-party conservative rule, wants to increase those charges by as much as US$2 billion a year.

Brazil — which sorely needs all the energy it can get to fuel its booming economy — financed the dam's entire construction, spending US$12.2 billion. Still, most Paraguayans think they should charge market prices for its electricity, or be allowed to sell it to other nations at a higher cost.

The treaty, signed in 1973 when dictators ruled both countries, expires in 2023. Both nations can agree to modify it, but Brazilian officials have insisted they won't.

The Itaipu dam has been the world's top hydroelectric producer since it started operating in 1980, although it will lose that distinction next year when China's Three Gorges dam begins generating power.

Paraguay has 6.7 million citizens compared to Brazil's nearly 190 million, and would never be able to use the excess energy now flowing to Brazil. The landlocked, mostly rural country even lacks transmission lines to boost consumption, which has stalled economic growth. Brazil offered a US$200 million loan to build that infrastructure, but many Paraguayans dismissed that gesture as an insult.

Lugo refused to say whether he shared his countrymen's sentiment, saying such discussion would start negotiations with Silva out on the wrong foot.

One of Lugo's political rivals, retired Paraguayan Gen. Lino Cesar Oviedo, was quick to criticize Lugo's trip. The president "is wasting his time because Brazil has already announced it won't renegotiate the treaty," Oviedo said.

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Massive power line will send Canadian hydropower to New York

Twin States Clean Energy Link connects New England to Hydro-Quebec via a 1,200 MW transmission line, DOE-backed capacity, underground segments, existing corridors, boosting renewable energy reliability across Vermont and New Hampshire with cross-border grid flexibility.

 

Key Points

DOE-backed 1,200 MW line linking Hydro-Quebec to New England, adding clean capacity with underground routes.

✅ 1,200 MW cross-border capacity for the New England grid

✅ Uses existing corridors; underground in VT and northern NH

✅ DOE capacity contract lowers risk and spurs investment

 

A proposal to build a new transmission line to connect New England with Canadian hydropower is one step closer to reality.

The U.S. Department of Energy announced Monday that it has selected the Twin States Clean Energy Link as one of three transmission projects that will be part of its $1.3 billion cross-border transmission initiative to add capacity to the grid.

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Twin States is a proposal from National Grid, a utility company that serves Massachusetts, New York, and Rhode Island, and also owns transmission in England and Wales as the region advances projects like the Scotland-to-England subsea link that expand renewable flows, and the non-profit Citizens Energy Corporation.

The transmission line would connect New England with power from Hydro-Quebec, moving into the United States from Canada in Northern Vermont and crossing into New Hampshire near Dalton. It would run through parts of Grafton, Merrimack, and Hillsborough counties, routing through a substation in Dunbarton and ending at a proposed new substation in Londonderry. (Here's a map of the Twin States proposal.)

The federal funding will allow the U.S. Department of Energy to purchase capacity on the planned transmission line, which officials say reduces the risk for other investors and can help encourage others to purchase capacity.

The project has gotten support from local officials in Vermont and New Hampshire, but there are still hurdles to cross. The contract negotiation process is beginning, National Grid said, and the proposal still needs approvals from regulators before construction could begin.

First Nations communities in Canada have opposed transmission lines connecting Hydro-Quebec with New England in the past, and the company has faced scrutiny from environmental groups.

What would Twin States look like?
Transmission projects, like the failed Northern Pass proposal, have been controversial in New England, though the Great Northern Transmission Line progressed in Minnesota.

But Reihaneh Irani-Famili, vice president of capital delivery, project management and construction at National Grid, said this one is different because the developers listened to community concerns before planning the project.

“They did not want new corridors of infrastructure, so we made sure that we're using existing right of way,” she said. “They did not want the visual impact and some of the newer corridors of infrastructure, we're making sure we're undergrounding portions of the line.”

In Vermont and northern New Hampshire, the transmission lines would be buried underground along state roads. South of Littleton, they would be located within existing transmission corridors.

The developers say the lines could provide 1,200 megawatts of transmission capacity. The project would have the ability to carry electricity from hydro facilities in Quebec to New England, and would also be able to bring electricity from New England into Quebec, a step toward broader macrogrid connectivity across regions.

“Those hydro dams become giant green batteries for the region, and they hold that water until we need the electrons,” Irani-Famili said. “So if you think about our energy system not as one that sees borders, but one that sees resources, this is connecting the Quebec resources to the New England resources and helping all of us get into that cleaner energy future with a lot less build than we otherwise would have.”

Irani-Famili says the transmission line could help facilitate more clean energy resources like offshore wind coming online. In a report released last week by New Hampshire’s Department of Energy, authors said importing Canadian hydropower could be one of the most cost-effective ways to move away from fossil fuels on the electric grid.

National Grid estimates the project will help save energy customers $8.3 billion in its first 12 years. The developers are constructing a $260 million “community benefits plan” that would take some profits from the transmission line and give that money back to communities that host the transmission lines and environmental justice communities in New England.

 

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Annual U.S. coal-fired electricity generation will increase for the first time since 2014

U.S. coal-fired generation 2021 rose as higher natural gas prices, stable coal costs, and a recovering power sector shifted the generation mix; capacity factors rebounded despite low coal stocks and ongoing plant retirements.

 

Key Points

Coal output rose 22% on high gas prices and higher capacity factors; a 5% decline is expected in 2022.

✅ Natural gas delivered cost averaged $4.93/MMBtu, more than double 2020

✅ Coal capacity factor rose to ~51% from 40% in 2020

✅ 2022 coal generation forecast to fall about 5%

 

We expect 22% more U.S. coal-fired generation in 2021 than in 2020, according to our latest Short-Term Energy Outlook (STEO). The U.S. electric power sector has been generating more electricity from coal-fired power plants this year as a result of significantly higher natural gas prices and relatively stable coal prices, even as non-fossil sources reached 40% of total generation. This year, 2021, will yield the first year-over-year increase in coal generation in the United States since 2014, highlighted by a January power generation jump earlier in the year.

Coal and natural gas have been the two largest sources of electricity generation in the United States. In many areas of the country, these two fuels compete to supply electricity based on their relative costs and sensitivity to policies and gas prices as well. U.S. natural gas prices have been more volatile than coal prices, so the cost of natural gas often determines the relative share of generation provided by natural gas and coal.

Because natural gas-fired power plants convert fuel to electricity more efficiently than coal-fired plants, record natural gas generation has at times underscored that advantage, and natural gas-fired generation can have an economic advantage even if natural gas prices are slightly higher than coal prices. Between 2015 and 2020, the cost of natural gas delivered to electric generators remained relatively low and stable. This year, however, natural gas prices have been much higher than in recent years. The year-to-date delivered cost of natural gas to U.S. power plants has averaged $4.93 per million British thermal units (Btu), more than double last year’s price.

The overall decline in electricity demand in 2020 and record-low natural gas prices led coal plants to significantly reduce the percentage of time that they generated power. In 2020, the utilization rate (known as the capacity factor) of U.S. coal-fired generators averaged 40%. Before 2010, coal capacity factors routinely averaged 70% or more. This year’s higher natural gas prices have increased the average coal capacity factor to about 51%, which is almost the 2018 average, a year when wind and solar reached 10% nationally.

Although rising natural gas prices have resulted in more U.S. coal-fired generation than last year, this increase in coal generation will most likely not continue as solar and wind expand in the generation mix. The electric power sector has retired about 30% of its generating capacity at coal plants since 2010, and no new coal-fired capacity has come online in the United States since 2013. In addition, coal stocks at U.S. power plants are relatively low, and production at operating coal mines has not been increasing as rapidly as the recent increase in coal demand. For 2022, we forecast that U.S. coal-fired generation will decline about 5% in response to continuing retirements of generating capacity at coal power plants and slightly lower natural gas prices.

 

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New fuel cell concept brings biological design to better electricity generation

Quinone-mediated fuel cell uses a bio-inspired organic shuttle to carry electrons and protons to a nearby cobalt catalyst, improving hydrogen conversion, cutting platinum dependence, and raising efficiency while lowering costs for clean electricity.

 

Key Points

An affordable, bio-inspired fuel cell using an organic quinone shuttle and cobalt catalyst to move electrons efficiently

✅ Organic quinone shuttles electrons to a separate cobalt catalyst

✅ Reduces platinum use, lowering cost of hydrogen power

✅ Bio-inspired design aims to boost efficiency and durability

 

Fuel cells have long been viewed as a promising power source. But most fuel cells are too expensive, inefficient, or both. In a new approach, inspired by biology, a team has designed a fuel cell using cheaper materials and an organic compound that shuttles electrons and protons.

Fuel cells have long been viewed as a promising power source. These devices, invented in the 1830s, generate electricity directly from chemicals, such as hydrogen and oxygen, and produce only water vapor as emissions. But most fuel cells are too expensive, inefficient, or both.

In a new approach, inspired by biology and published today (Oct. 3, 2018) in the journal Joule, a University of Wisconsin-Madison team has designed a fuel cell using cheaper materials and an organic compound that shuttles electrons and protons.

In a traditional fuel cell, the electrons and protons from hydrogen are transported from one electrode to another, where they combine with oxygen to produce water. This process converts chemical energy into electricity. To generate a meaningful amount of charge in a short enough amount of time, a catalyst is needed to accelerate the reactions.

Right now, the best catalyst on the market is platinum -- but it comes with a high price tag, and while advances like low-cost heat-to-electric materials show promise, they address different conversion pathways. This makes fuel cells expensive and is one reason why there are only a few thousand vehicles running on hydrogen fuel currently on U.S. roads.

Shannon Stahl, the UW-Madison professor of chemistry who led the study in collaboration with Thatcher Root, a professor of chemical and biological engineering, says less expensive metals can be used as catalysts in current fuel cells, but only if used in large quantities. "The problem is, when you attach too much of a catalyst to an electrode, the material becomes less effective," he says, "leading to a loss of energy efficiency."

The team's solution was to pack a lower-cost metal, cobalt, into a reactor nearby, where the larger quantity of material doesn't interfere with its performance. The team then devised a strategy to shuttle electrons and protons back and forth from this reactor to the fuel cell.

The right vehicle for this transport proved to be an organic compound, called a quinone, that can carry two electrons and protons at a time. In the team's design, a quinone picks up these particles at the fuel cell electrode, transports them to the nearby reactor filled with an inexpensive cobalt catalyst, and then returns to the fuel cell to pick up more "passengers."

Many quinones degrade into a tar-like substance after only a few round trips. Stahl's lab, however, designed an ultra-stable quinone derivative. By modifying its structure, the team drastically slowed down the deterioration of the quinone. In fact, the compounds they assembled last up to 5,000 hours -- a more than 100-fold increase in lifetime compared to previous quinone structures.

"While it isn't the final solution, our concept introduces a new approach to address the problems in this field," says Stahl. He notes that the energy output of his new design produces about 20 percent of what is possible in hydrogen fuel cells currently on the market. On the other hand, the system is about 100 times more effective than biofuel cells that use related organic shuttles.

The next step for Stahl and his team is to bump up the performance of the quinone mediators, allowing them to shuttle electrons more effectively and produce more power. This advance would allow their design to match the performance of conventional fuel cells, but with a lower price tag.

"The ultimate goal for this project is to give industry carbon-free options for creating electricity, including thermoelectric materials that harvest waste heat," says Colin Anson, a postdoctoral researcher in the Stahl lab and publication co-author. "The objective is to find out what industry needs and create a fuel cell that fills that hole."

This step in the development of a cheaper alternative could eventually be a boon for companies like Amazon and Home Depot that already use hydrogen fuel cells to drive forklifts in their warehouses.

"In spite of major obstacles, the hydrogen economy, with efforts such as storing electricity in pipelines in Europe, seems to be growing," adds Stahl, "one step at a time."

Financial support for this project was provided by the Center for Molecular Electrocatalysis, an Energy Frontier Research Center funded by the U.S. Department of Energy, Office of Science, Office of Basic Energy Sciences, and by the Wisconsin Alumni Research Foundation (WARF) through the WARF Accelerator Program.

 

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Power firms win UK subsidies for new Channel cables project

UK Electricity Interconnectors secure capacity market subsidies, supporting winter reliability with seabed cables to France and Belgium via the Channel Tunnel, lowering consumer costs, squeezing coal, and challenging new gas plants through cross-border energy trading.

 

Key Points

High-voltage cables linking Britain to Europe, securing backup capacity, cutting costs and boosting winter reliability.

✅ Won capacity market contracts at record-low prices

✅ Cables to France and Belgium via Channel Tunnel, seabed routes

✅ Squeezes coal, challenges new gas; renewables may join market

 

New electricity cables across the Channel to France and Belgium will be a key part of keeping Britain’s lights on during winter amid record electricity prices across Europe in the early 2020s, after their owners won backup power subsidies in a government auction this week.

For the first time, interconnector operators successfully bid for a slice of hundreds of millions’ worth of contracts in the capacity market. That will help cut costs for consumers, given how electricity is priced in Europe today, and squeeze out old coal power plants.

Three new interconnectors are currently being built to Europe, almost doubling existing capacity, with one along the Channel Tunnel and two on the seabed: one between Kent and Zeebrugge and one from Hampshire to Normandy. 

The interconnectors were success stories in this week’s capacity auction, which saw power firms bid to provide backup electricity in the winter of 2021/22. Prices for the four-year contracts hit a record low of £8.40 per kilowatt per year, which analysts described as a shock and well below expectations.

One industry source said the figure was “miles away” from what is needed to encourage companies to build big new gas power stations, which some argue are necessary to fill the gap when the UK’s ageing nuclear reactors close as Europe loses nuclear power across the region over the next decade.

While bad news for those firms, the low price is good for consumers. The subsidies will add about £525m to energy bills, or £5.68 for the average household, compared with £11 for the year before, according to analysts Cornwall Insight.

Existing gas power stations scooped up most of the contracts, but new gas ones lost out, as did several coal plants. Battery storage plants, a standout success in the last auction, fared comparatively poorly after changes to the rules.

Experts at Bernstein bank said the the misses by coal meant that around half the UK’s remaining coal power capacity could close from October 2019, when existing capacity market contracts run out. Chaitanya Kumar, policy adviser at thinktank Green Alliance, said: “Coal’s exit from the UK’s energy system just moved a step closer as coal contracts fell by half compared with last year.”

Tom Edwards, an analyst at Cornwall Insight, said that more interconnectors were likely to bid into future rounds of the capacity market, such as the cable being laid between Norway and the UK. Relying on foreign power supplies was fine, he said, provided Brexit did not make energy trading more difficult and the interconnectors delivered at times of need, where events like Irish grid price spikes illustrate the stress points.

However, one industry source, who wants to see new gas plants built in the UK, said the results showed that the system was not working, amid UK peak power prices that have climbed in recent trading. “That self-sufficiency doesn’t seem to be a priority at a time when we’re breaking away from Europe is a bit weird,” they said.

But the prospects for new gas plants in future rounds of the capacity market look bleak. They will very likely face a new source of competition next year, if energy regulator Ofgem approves a proposal to allow renewables to compete too.

 

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Hydro-Quebec won't ask for rate hike next year

Hydro-Quebec Rate Freeze maintains current electricity rates, aligned with Bill 34, inflation indexing, and energy board oversight, delivering rebates to residential, commercial, and industrial customers and projecting nearly $1 billion in savings across Quebec.

 

Key Points

A Bill 34 policy holding power rates, adding 2020 rebates, and indexing 2021-2024 rates to inflation for Quebec customers.

✅ 2020-21 rates frozen; savings near $1B over five years.

✅ $500M rebate: residential, commercial, industrial shares.

✅ 2021-2024 rates index to inflation; five-year reviews after 2025.

 

Hydro-Quebec Distribution will not file a rate adjustment application with the province’s energy board this year, amid a class-action lawsuit alleging customers were overcharged.

In a statement released on Friday the Crown Corporation said it wants current electricity rates to be maintained for another year, as pandemic-driven demand pressures persist, starting April 1. That is consistent with the recently tabled Bill 34, and echoes Ontario legislation to lower electricity rates in its aims, which guarantees lower electricity rates for Quebecers.

The bill also provides a $500 million rebate in 2020, similar to a $535 million refund previously issued, half of which will go to residential customers while $190 million will go to commercial customers and another $60 million to industrial ones.

Hydro-Quebec said the 2020-21 rate freeze will generate savings of nearly $1 billion for its clients over the next five years, even as Manitoba Hydro scales back increases in a different market.

Bill 34, which was tabled in June, also proposes to set rates based on inflation for the years 2021 to 2024, contrasting with Ontario rate increases over the same period. After 2025 Hydro-Quebec would have to ask the energy board to set new rates every five years, as opposed to the current annual system, while BC Hydro is raising rates by comparison.

 

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Imported coal volumes up 17% during Apr-Oct as domestic supplies shrink

India Thermal Power Coal Imports surged 17.6% as CEA-monitored plants offset weaker CIL and SCCL supplies, driven by Saubhagya-led electricity demand, regional power deficits, and varied consumption across Uttar Pradesh, Bihar, Maharashtra, and Gujarat.

 

Key Points

Fuel volumes imported for Indian thermal plants, tracked by CEA, reflecting shifts in CIL/SCCL supply, demand, and regional power deficits.

✅ Imports up 17.6% as domestic CIL/SCCL deliveries lag targets

✅ Saubhagya-driven demand lifts generation in key beneficiary states

✅ Industrial slowdowns cut usage in Maharashtra, Tamil Nadu, Gujarat

 

The receipt of imported coal by thermal power plants, where plant load factors have risen, has shot up by 17.6 per cent during April-October. The coal import volumes refer to the power plants monitored by the Central Electricity Authority (CEA), and come amid moves to ration coal supplies as electricity demand surges, a power update report from CARE Ratings showed.

Imports escalated as domestic supplies by Coal India Ltd (CIL) and another state run producer- Singareni Collieries Company Ltd (SCCL) dipped in the period, after earlier shortages that have since eased in later months. Rate of supplies by the two coal companies to the CEA monitored power stations stood at 80.4 per cent, indicating a shortfall of 19.6 per cent against the allocated quantity.

According to the study by CARE Ratings, total coal supplied by CIL and SCCL to the power sector stood at 315.9 million tonnes (mt) during April-October as against 328.5 mt in the comparable period of last fiscal year.

The study noted that growth in power generation during the April-October 2019, with India now the third-largest electricity producer globally, was on account of higher demand from Pradhan Mantri Sahaj Bijli Har Ghar Yojana or Saubhagya Scheme beneficiary states. Providing connection to households in order to achieve 100% per cent electrification has in part helped the sector avert de-growth, as part of efforts to rewire Indian electricity and expand access.

Large states namely Uttar Pradesh, Bihar, Punjab, West Bengal and Rajasthan have recorded over five per cent growth in consumption of power. These states along with Odisha, Madhya Pradesh and Assam accounted for 75 per cent of the beneficiaries under the Saubhagya Scheme (Household Electrification Scheme). The ongoing economic downturn has led to a sharp fall in electricity demand from industrialised states. Maharashtra, which is also the largest power consuming state in India, recorded a decline in consumption of 5.6 per cent.

Other states namely Tamil Nadu, Telangana, Gujarat and Odisha too recorded fall in power consumed, echoing global dips in daily electricity demand seen later during the pandemic. These states house large clusters of mining, automobile, cement and other manufacturing industries, and a decline in these sectors led to fall in demand for power across these states. - The demand-supply gap or power deficit has remained at 0.6 per cent during the April-October 2019. North-East reported 4.8 per cent of power deficit followed by Northern Region at 1.3 per cent. Within Northern Region, Jammu & Kashmir and Uttar Pradesh accounted for 65 per cent and 30 per cent respectively of the regions power supply deficit.

 

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