Hydro One to Reconnect 1,400 Customers Cut-Off for Nonpayment

Hydro One-Avista Acquisition secures U.S. antitrust clearance under Hart-Scott-Rodino, pending approvals from state utility commissions, the FCC, and CFIUS, with prior FERC approval and shareholder vote supporting the cross-border utility merger.

Key Points

A $6.7B cross-border utility merger cleared under HSR, still awaiting state, FCC, and CFIUS approvals; FERC approved earlier.

✅ HSR waiting period expired; U.S. antitrust clearance obtained

✅ Approvals pending: state commissions, FCC, and CFIUS

✅ FERC and Avista shareholders have approved the transaction

Hydro One Ltd. says it has received antitrust clearance in the United States for its deal to acquire U.S. energy company Avista Corp., even as it sought to redesign customer bills in Ontario.

The Ontario-based utility says the 30-day waiting period under the Hart-Scott-Rodino Antitrust Improvements Act expired Thursday night.

Hydro One announced the friendly deal to acquire Avista last summer, amid customer backlash in some service areas, in an agreement that valued the company at $6.7 billion.

The deal still requires several other approvals, including those from utility commissions in Washington, Idaho, Oregon, Montana and Alaska.

Analysts also warned of political risk for Hydro One during this period, reflecting concerns about provincial influence.

The U.S. Federal Communications Commission must also sign off on the transaction, and although U.S. regulators later rejected the $6.7B takeover following review, clearance is required by the Committee on Foreign Investment in the United States.

The agreement has received approval from the U.S. Federal Energy Regulatory Commission as well as Avista shareholders, and it mirrored other cross-border deals such as Algonquin Power's acquisition of Empire District that closed in the sector.

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Russia-Ukraine Energy War disrupts infrastructure, oil, gas, and electricity, triggering supply shocks, price spikes, and inflation. Global markets face volatility, import risks, and cybersecurity threats, underscoring energy security, grid resilience, and diversified supply.

Key Points

It is Russia's strategic targeting of Ukraine's energy system to disrupt supplies, raise prices, and hit global markets.

✅ Attacks weaponize energy to strain Ukraine and allies

✅ Supply shocks risk oil, gas, and electricity price spikes

✅ Urgent need for cybersecurity, grid resilience, diversification

Russia's targeting of Ukraine's energy infrastructure has unleashed an "energy war" that could lead to widespread price increases, supply disruptions, and ripple effects throughout the global energy market, felt across the continent, with warnings of Europe's energy nightmare taking shape.

This highlights the unprecedented scale and severity of the attacks on Ukrainian energy infrastructure. These attacks have disrupted power supplies, prompting increased electricity imports to keep the lights on, hindered oil and gas production, and damaged refineries, impacting Ukraine and the broader global energy system.

Energy as a Weapon

Experts claim that Russia's deliberate attacks on Ukraine's energy infrastructure represent a strategic escalation, amid energy ceasefire violations alleged by both sides, demonstrating the Kremlin's willingness to weaponize energy as part of its war effort. By crippling Ukraine's energy system, Russia aims to destabilize the country, inflict suffering on civilians, and undermine Western support for Ukraine.

Impacts on Global Oil and Gas Markets

The ongoing attacks on Ukraine's energy infrastructure could significantly impact global oil and gas markets, leading to supply shortages and dramatic price increases, even as European gas prices briefly returned to pre-war levels earlier this year, underscoring extreme volatility. Ukraine's oil and gas production, while not massive in global terms, is still significant, and its disruption feeds into existing anxieties about global energy supplies already affected by the war.

Ripple Effects Beyond Ukraine

The impacts of the "energy war" won't be limited to Ukraine or its immediate neighbours. Price increases for oil, gas, and electricity are expected worldwide, further fueling inflation and exacerbating the global cost of living crisis.  Additionally, supply disruptions could disproportionately affect developing nations and regions heavily dependent on energy imports, making targeted energy security support to Ukraine and other vulnerable importers vital.

Vulnerability of Energy Infrastructure

The attacks on Ukraine highlight the vulnerability of critical energy infrastructure worldwide, as the country prepares for winter under persistent threats. The potential for other state or non-state actors to use similar tactics raises concerns about security and long-term stability in the global energy sector.

Strengthening Resilience

Experts emphasize the urgent need for global cooperation in strengthening the resilience of energy infrastructure. Investments in cybersecurity, diverse energy sources, and decentralized grids are crucial for mitigating the risks of future attacks, with some arguing that stepping away from fossil fuels would improve US energy security over time. International cooperation will be key in identifying vulnerable areas and providing aid to nations whose infrastructure is under threat.

The Unpredictable Future of Energy

The "energy war" unleashed by Russia has injected a new level of uncertainty into the global energy market. In addition to short-term price fluctuations and supply issues, the conflict could accelerate the long-term transition towards renewable energy sources and reshape how nations approach energy security.

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Hydro-Québec Northeast Clean Energy Transmission delivers surplus hydropower via HVDC interconnections to New York and New England, leveraging long-term contracts and projects like CHPE and NECEC to support carbon-free goals, GHG cuts, and grid reliability.

Key Points

An initiative to expand HVDC links for Quebec hydropower exports, aiding New York and New England decarbonization.

✅ 37,000 MW hydro capacity enables firm, low-carbon exports

✅ Targets NY and NE via CHPE, NECEC, and upgraded interfaces

✅ Backed by long-term PPAs to reduce merchant transmission risk

With roughly 37,000 MW of installed hydro power capacity, Quebec has ample spare capacity that it would like to deliver into Northeastern US markets where ambitious clean energy goals have been announced, but expanding transmission infrastructure is challenging.

Register Now New York recently announced a goal of receiving 100% carbon-free energy by 2040 and the New England states all have ambitious greenhouse gas reduction goals, including a Massachusetts law requiring GHG emissions be 80% below 1990 levels by 2050.

The province-owned company, Hydro Quebec, supplies power to the provinces of Quebec, Ontario and New Brunswick in particular, as well as sending electricity directly into New York and New England. The power transmission interconnections between New York and New England have reached capacity and in order to increase export volumes into the US, "we need to build more transmission infrastructure," Gary Sutherland, relationship manager in business development, recently said during a presentation to reporters in Montreal.

TRANSMISSION OPTIONS

Hydro Quebec is working with US transmission developers, electric distribution companies, independent system operators and state government agencies to expand that transmission capacity in order to delivery more power from its hydro system to the US, as the province has closed the door on nuclear power and continues to prioritize hydropower, Sutherland said.

The company is looking to sign long-term power supply contracts that could help alleviate some of the investment risk associated with these large infrastructure projects.

"It`s interesting to recall that in the 1980s, two decade-long contracts paved the way for construction of Phase II of the multi-terminal direct-current system (MTDCS), a cross-border line that delivers up to 2,000 MW from northern Quebec to New England," Hydro Quebec spokeswoman Lynn St-Laurent said in an email.

Long-term prices have been persistently low since 2012, following the shale gas boom and the economic decline in 2008-2009, St-Laurent said. "As such, investment risks are too high for merchant transmission projects," she said.

Northeast power market fundamentals "remain strong for long-term contracts," on transmission projects or equipment upgrades that can deliver clean power from Quebec and "help our neighbors reach their ambitious clean energy goals," St-Laurent said.

NEW ENGLAND

In March 2017 an HQ proposal was selected by Massachusetts regulators to supply 9.45 TWh of firm energy to be delivered for 20 years. HQ`s proposal consisted of hydro power supply and possible transmission scenarios developed in conjunction with US partners.

The two leading options include a route through New Hampshire called Northern Pass and New England Clean Energy Connect through Maine.

The New Hampshire Site Evaluation Committee in March 2018 voted unanimously to deny approval of the $1.6 billion Northern Pass Transmission project, which is a joint venture between HQ and Eversource Energy`s transmission business. Eversource has been fighting the decision, with the New Hampshire Supreme Court accepting the company`s appeal of the NHSEC decision in October.

Briefs are being filed and oral arguments are likely to begin late spring or early summer, spokesman William Hinkle said in an email Tuesday.

After the Northern Pass permitting delay, Massachusetts chose the New England Clean Energy Connect project, which is a projected 1,200 MW transmission line, with 1,090 MW contracted to Massachusetts, leaving 110 MW for use on a merchant basis, according to St-Laurent.

NECEC is a joint venture between HQ and Central Maine Power, which is a subsidiary of Avangrid, a company affiliated with Spain`s Iberdrola. The NECEC project has received opposition from some environmental groups and still needs several state and federal permits.

NEW YORK

"The 5% of New York`s load that we furnish year in and year out ... is mostly going into the north of the state, it`s not coming down here," Sutherland said during a discussion at Pace University in New York City in 2017.

One potential project moving through the permitting phase, is the $2.2 billion, 1,000-MW Champlain Hudson Power Express transmission line being pursued by Transmission Developers -- a Blackstone portfolio company -- that would transport power from Quebec to Queens, New York.

Under New York`s proposed Climate Leadership Act which calls for the 100% carbon-free energy goal, renewable generation eligibility would be determined by the Public Service Commission. The PSC did not respond to a question about whether hydro power from Quebec is being considered as a potential option for meeting the state`s clean energy goal.

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Community Solar for Low-Income Homes expands energy equity by delivering renewable energy access, predictable bill savings, and tax credit benefits to renters and energy-insecure households, accelerating distributed generation and storage adoption nationwide.

Key Points

A program model enabling renters and LMI households to subscribe to off-site solar and save on utility bills.

✅ Earn bill credits from shared solar generation.

✅ Expands access for renters and LMI subscribers.

✅ Often paired with storage and IRA tax credit adders.

On a square-foot basis, the issue of inequality is made worse by higher costs for energy usage in the nation. Efforts like community solar programs such as Maryland community solar are underway to boost low-income participation in the cost benefits of renewable energy.

The Energy Information Administration (EIA) shows that households that are considered energy insecure, or those that have the inability to adequately meet basic household energy costs, are paying more for electricity than their wealthier counterparts. 

On average in the United States in 2020, households were billed about $1.04 per square foot for all energy sources. For homes that did not report energy insecurity, that average was $0.98 per square foot, while homes with energy insecurity issues paid an average of $1.24 per square foot for energy. This means that U.S. residents that need the most support on their energy bills are stuck with costs 27% higher than their neighbors on square-foot-basis.

EIA said energy-insecure households have reduced or forgone basic necessities to pay energy bills, kept their houses at unsafe temperatures because of energy cost concerns, or been unable to repair heating or cooling equipment because of cost.

In 2020, households with income less than $10,000 a year were billed an average of $1.31 per square foot for energy, while households making $100,000 or more were billed an average of $0.96 per square foot, said EIA. Renters paid considerably more ($1.28 per square foot) than owners ($0.98 per square foot). There were also considerable differences between regions, with New England solar growth sparking grid upgrade debates, ethnic groups and races, and insulation levels, as seen below.

The energy transition toward renewables like solar has offered price stability, amid record solar and storage growth nationwide, but thus far energy-insecure communities have relatively been left behind. A recent Berkeley Lab report, Residential Solar-Adopter Income and Demographic Trends, indicates that even though the rate of solar adoption among low-income residents is increasing (from 5% in 2010 to 11% in 2021), that segment of energy consumers remains under-represented among solar adopters, relative to its share of the population.

Community solar efforts

As such, the United States is targeting communities most impacted by energy costs that have not benefitted from the transition, highlighting “Energy Communities” that are eligible for an additional 10% tax credit through funds made possible by the Inflation Reduction Act.

Additionally, a push for community solar development is taking place nationwide to extend access to affordable solar energy to renters and other residents that aren’t able to leverage finances to invest in predictable, low-cost residential solar systems. The Biden Administration set a goal this year to sign up 5 million community solar households, achieving $1 billion in bill savings by 2025. The community solar model only represents about 8% of the total distributed solar capacity in the nation. This target would entail a jump from 3 GW installed capacity to 20 GW by the target year. The Department of Energy estimates community solar subscribers save an average of 20% on their bills.

California this year passed AB 2316, the Community Renewable Energy Act takes aim at four acute problems in the state’s power market: reliability amid rising outage risks, rates, climate and equity. The law creates a community renewable energy program, including community solar-plus-storage, supported by cheaper batteries, to overcome access barriers for nearly half of Californians who rent or have low incomes. Community solar typically involves customers subscribing to an off-site solar facility, receiving a utility bill credit for the power it generates.

“Community renewable energy is a proven powerful tool to help close California’s clean energy gap, bringing much needed relief to millions struggling with high housing costs and utility debt,” said Alexis Sutterman, energy equity program manager at the California Environmental Justice Alliance.

The program has energy equity baked into its structure, working to make sure Californians of all income levels participate in the benefits of the energy transition. Not only does it open solar access to renters, the law ensures that at least 51% of subscribers are low-income customers, which is expected to make projects eligible for a 10% tax credit adder under the IRA.

“The money’s on the table now,” said Jeff Cramer, president and chief executive of the Coalition for Community Solar Access. “While there are groups pushing for solar access for all, and states with strong legislation, there are other pockets of interest in surprising places in the United States. For example, Louisiana has no policy for community solar or support for low-income residents going solar but the city of New Orleans has its own utility commission with a community solar program. In Nebraska, forward-looking co-operatives have created community solar projects.

Community solar markets are active in 22 states, with more expected to come online in the future as states pursue 100% clean energy targets across the country. However, the market is expected to require strong community outreach efforts to foster trust and gain subscribers.

“There is a distrust of community solar initially in LMI communities as many have been burned before by retail energy false promises,” said Eric LaMora, executive director, community solar, Nautilus Solar on a panel at the Solar Energy Industries Association Finance, Tax, and Buyers seminar. “People are suspicious but there really are no hooks with community solar.”

LMI residents are leery to provide tax records or much documents at all in order to sign up for community solar, LaMora said. “We were surprised to see less of a default rate with LMI residents. We attribute this to the fact that they see significant savings on their electric bill, making it easier to pay each month,” he said.

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EIA U.S. Power Outlook 2023-2024 forecasts lower electricity demand, softer wholesale prices, and faster renewable growth from solar and wind, with steady natural gas, reduced coal generation, slight nuclear gains, and ERCOT market moderation.

Key Points

An EIA forecast of a 2023 demand dip, 2024 rebound, lower prices, and a higher renewable share in the U.S. power mix.

✅ Demand dips to 4,000 billion kWh in 2023; rebounds in 2024.

✅ ERCOT on-peak prices average about $35/MWh versus $80/MWh in 2022.

✅ Renewables grow to 24% share; coal falls to 17%; nuclear edges up.

U.S. power consumption is expected to slip about 1% in 2023 from the previous year as milder weather slows usage from the record high hit in 2022, consistent with recent U.S. consumption trends observed over the past several years, the U.S. Energy Information Administration (EIA) said in its Short-Term Energy Outlook (STEO).

EIA projected that electricity demand is on track to slide to 4,000 billion kilowatt-hours (kWh) in 2023 from a historic high of 4,048 billion kilowatt-hours (kWh) in 2022, reflecting patterns seen during COVID-19 demand shifts in prior years, before rising to 4,062 billion kWh in 2024 as economic growth ramps up.

Less demand coupled with more electricity generation from cheap renewable power sources and lower natural gas prices is forecast to slash wholesale power prices this year, the EIA said.

The on-peak wholesale price at the North hub in Texas’ ERCOT power market is expected to average about $35 per megawatt-hour (MWh) in 2023 compared with an average of nearly $80/MWh in 2022 after the 2022 price surge in power markets.

As capacity for renewables like solar and wind ramp up and as natural gas prices ease amid the broader energy crisis pressures, the EIA said it expects coal-fired power generation to be 17% less in the spring of 2023 than in the spring of 2022.

Coal will provide an average of 17% of total U.S. generation this year, down from 20% last year, as utilities shift investments toward electricity delivery and away from new power production, the EIA said.

The share of total generation supplied by natural gas is seen remaining at about the same this year at 39%. The nuclear share of generation is seen rising slightly to 20% this year from 19% in 2022. Generation from renewable energy sources grows the most in the forecast, increasing to 24% this year from a share of 22% last year, even as residential electricity bills rose in 2022 across the U.S.

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Nordic Power Grid Dispute highlights cross-border interconnector congestion, curtailed exports and imports, hydropower priorities, winter demand spikes, rising spot prices, and transmission grid security amid decarbonization efforts across Sweden, Norway, Finland, and Denmark.

Key Points

A clash over interconnectors and capacity cuts reshaping trade, prices, and reliability in the Nordic power market.

✅ Sweden cuts interconnector capacity to protect grid stability

✅ Norway prioritizes higher-priced exports via new cables

✅ Finland and Denmark seek EU action on capacity curtailments

A spat over electricity supplies is heating up in northern Europe. Sweden is blocking Norway from using its grids to transfer power from producers throughout the region. That’s angered Norway, which in turn has cut flows to its Nordic neighbor.

The dispute has built up around the use of cross-border power cables, which are a key part of Europe’s plans to decarbonize since they give adjacent countries access to low-carbon resources such as wind or hydropower. The electricity flows to wherever prices are higher, informed by how electricity is priced across Europe, without interference from grid operators -- but in the event of a supply squeeze, flows can be stopped.

Sweden moved to safeguard the security of its grid after Norway started increasing electricity exports through huge new cables to Germany and the U.K. Those exports at times have drawn energy away from Sweden, resulting in the country’s system operator cutting capacity at its Nordic borders, preventing exports but also hindering imports, which it relies on to handle demand spikes during winter.

“This is not a good situation in the long run,” Christian Holtz, a energy market consultant for Merlin & Metis AB.

Norway hit back last week by cutting flows to Sweden, this will prioritize better paying customers in Europe, amid Irish price spikes that highlight dispatchable shortages, giving them access to its vast hydro resources at the expense of its Nordic neighbors. 

By partially closing its borders Sweden can’t access imports either, which it relies on to handle demand spikes during the coldest days of the winter. 

In Denmark, unusual summer and autumn winds have at times delivered extraordinarily low electricity prices that ripple through regional markets.

The Swedish grid manager Svenska Kraftnat has reduced export capacity at cables across its borders by as much as half this year to keep operations secure. Finland and Denmark rely on imports too and the cuts will come at a cost for millions of homes and industries across the four nations already contending with record electricity rates this year. 

Finland and Denmark want the European Union to end the exemption to regulations that make such reductions possible in the first place, as Europe is losing nuclear power and facing tighter supply.

“Imports from our neighboring countries ensure adequacy at times of peak consumption,” said Reima Paivinen, head of operation at the Finland’s Fingrid. “The recent surge in electricity prices throughout Europe does not directly affect the adequacy of electricity, but prices may rise dramatically for short periods.”

Svenska Kraftnat says it’s not political -- it has no choice but to cut capacity until its old grids are expanded to handle the new direction of flows, a challenge mirrored by grid expansion woes in Germany that slow integration. That could take at least until 2030 to complete, it said earlier this year. At the same time, Norway halving available export capacity to about 1,200 megawatts will increase risk of shortages. 

“If we need more we will have to count on imports from other countries,” said Erik Ek, head of strategic operation at Svenska Kraftnat. “If that is not available, we will have to disconnect users the day it gets cold.”

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