Hydro-Québec TransÉnergie and Hydro One Networks have signed an agreement for the construction of a new 1250 MW Québec-Ontario interconnection. Pierre Corbeil, Québec's Minister of Natural Resources and Wildlife, and the Honourable Dwight Duncan, Ontario's Minister of Energy, made the announcement yesterday.

"As stipulated in Québec's Energy Strategy, and thanks to the flexibility that our government is striving to restore, Québec will be able to meet its own energy needs, create wealth and take advantage of export opportunities," said Corbeil. "Ontario, for its part, wants guaranteed access to clean energy sources in order to meet its electricity needs. The agreement for the construction of an interconnection between the two provinces is therefore extremely meaningful."

"The project will help meet the needs of more than 400,000 average homes in Ontario," said Duncan. "By modernizing and strengthening the province's transmission lines, we can be sure of always having enough electricity to meet the demand. Under the new agreement, Ontario will have access to a form of energy produced without greenhouse gas emissions, and will also improve its infrastructures."

By exporting energy that is surplus to requirements, Québec will obtain additional revenues for the Generations Fund and help pay down the debt for future generations. Exports will also help reduce greenhouse gas emissions, since the clean, renewable energy from Québec will replace fossil fuel sources. "This new agreement clearly illustrates the ties that bind Québec and Ontario," said Benoît Pelletier, MNA for Chapleau, Minister for Canadian Intergovernmental Affairs. "Not only is it of interest in terms of cooperation and environmental conservation, but it also illustrates the effectiveness of the agreements signed by our two governments last June."

"In its Energy Strategy, the Québec Government clearly states its desire to increase the volume of transactions between Québec and Ontario," said Corbeil. "The proposed interconnection will not only allow Hydro-Québec Production to export its surplus energy to Ontario, it will also improve local load reliability by providing access to an additional supply source."

The project will generate investments totalling $684 million for Québec and $124 million for Ontario. It will add an important new connection between the two grids, as well as fostering exchanges of energy and enhancing the overall supply security of Québec's grid.

The first phase of the project - the new connection with Ontario - will come into service on May 1, 2009, and will have a capacity of 900 MW. The second phase - the addition of a reinforcement line - will be brought into service in the spring of 2010, and will increase the connection's capacity to 1250 MW. The line will be built in the Outaouais region.