Schenectady County

Champlain Hudson power line to pay Schenectady County $85M over 30 years

The Hudson River is seen underneath the Route 4 Bridge.

The Hudson River is seen underneath the Route 4 Bridge.

SCHENECTADY — The long-delayed underground power line from Quebec to New York City will generate $85 million in revenue for Schenectady County and some of its towns and school districts.

The Schenectady County Industrial Development Agency on Wednesday announced a 30-year payment in lieu of taxes agreement with developers of the Champlain Hudson Power Express, which will carry a gigawatt of electricity for roughly 340 miles.

The project was first proposed in 2010. Gov. Kathy Hochul on Monday announced the state had chosen it as part of the infrastructure upgrade needed to move clean energy north to south; construction could begin next year. However, the transmission line still has not received final approval from the Public Service Commission, New York’s regulatory agency for utility infrastructure.

And debate continues between advocates and opponents over its environmental impacts. It is an important part of New York state’s official strategy to reduce its carbon emissions footprint, but some say it would create other problems here and in Canada.

Much of the $2 billion power line will run under Lake Champlain and the Hudson River, as the name suggests. But it will veer inland in the Capital Region, and pass through Glenville, Rotterdam and Scotia on its way to the Hudson River near the village of Catskill.

The Schenectady County Metroplex Development Authority, which administers the county IDA, said placing a value on the power line for purposes of taxation was not as clear-cut as for a new office tower or casino, as it will be entirely underground on railroad grades that already are taxed. 

Cost to construct the 14-mile Schenectady County segment is estimated at $100 million. The IDA and developer Transmission Developers Inc. negotiated a $72 million value and a PILOT worth $85 million over its 30-year lifespan, which would equal 100% of the combined tax bill at current tax rates over 30 years.

It will be split seven ways:

  • Glenville, $4.1 million
  • Niskayuna Central School District, $12.9 million
  • Rotterdam, $4.9 million
  • Schalmont Central School District, $26.1 million
  • Schenectady County, $18.4 million
  • Scotia, $2.6 million
  • Scotia-Glenville Central School District, $16.2 million

The annual PILOT payments will start when electricity begins to flow, which is projected in 2025.

Separately, the county IDA will receive a $1 million fee.

The town of Glenville announced Monday that it had negotiated a host community benefit fee: A one-time payment of $80,000, which it plans to spend on sidewalks on Alplaus Avenue. That money will come as soon as the developer closes on its financing, and is not connected to the PILOT deal announced Wednesday.

Schenectady County leaders on Wednesday thanked Hochul for selecting the project as part of the state strategy.

County Legislator Gary Hughes, chairman of the Schenectady County IDA, said in a news release: “This new green energy transmission line will be located along 14 miles of existing railroad track so the impact here in Schenectady County is minimal yet the financial impact is significant.”

As the state implements policies to phase out carbon-based fuel in favor of renewable energy, population-dense New York City will be relying even more heavily on electricity generated in less-populated areas to the north and northwest.

The electricity carried by the Champlain Hudson line will come from zero-emission hydropower generated in Quebec. Clean Path NY, a separate project also selected Monday, will bring electricity from wind and solar farms in central New York to New York City via the Blenheim-Gilboa pumped hydropower facility, which will help smooth out the spikes and dips inherent in solar and wind power.  

Hochul said these projects will reduce greenhouse gas emissions by 77 million metric tons over the first 15 years, the same impact as taking 1 million cars off the road.

But the potential environmental impact of the Champlain Hudson power line has generated sustained criticism, particularly involving the portion that will run under the Hudson River. And the power line will sustain the market for hydropower projects in Quebec, which critics say harm indigenous people and their lands.

Categories: Business, News

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