Hydro-Québec’s industrial customers are not happy. They have inherited what appears to be the worst news in Minister Pierre Fitzgibbon’s energy bill. The freeze which partially protected Rate L from Hydro-Québec’s annual increase has been eliminated.
“This is very worrying for the future competitiveness of our companies,” reacted Jocelyn Allard, president of the Quebec Association of Industrial Electricity Consumers.
Hydro-Québec’s largest industrial customers fear paying dearly for the government’s desire to significantly increase electricity production to attract investments in the battery sector and the energy transition.
In 2014, the Quebec government decided to partially save the industrial rate from Hydro-Québec’s annual increases to maintain the competitiveness of these large companies whose competition is international. A significant part, some 70% of the energy component of Tariff L, had thus been sheltered from tariff increases. It is this protection that the bill abolishes and which will significantly increase the L rate from 2026.
“Everyone is going to pay more, but here we are giving big industry a big blow,” notes Jocelyn Allard.
The spokesperson for industrial consumers is also happy that the government is giving back to the Régie de l’énergie the responsibility for setting Hydro-Québec rates. However, he is concerned that Hydro-Québec will no longer be obliged to make calls for tenders for its new energy supplies.
This additional latitude granted to Hydro-Québec is perhaps necessary to increase electricity production more quickly, but it also raises questions, according to Pierre-Olivier Pineau, professor and holder of the Chair of Energy Sector Management. from HEC Montreal. “We have to go quickly, but we want to go quickly without knowing who will pay for it,” he emphasizes.
The government is announcing an energy resource management plan, but while waiting for the plan, it will move forward immediately with a 60 terawatt-hour increase in electricity supplies. Pierre-Olivier Pineau would have liked the bill to give less space to increasing production and more space to energy sobriety.
The spokesperson for the Regroupement des organisms Environnemental en Énergie, Jean-Pierre Finet, says he was unpleasantly surprised by elements of the bill that went under the radar.
According to him, this change opens the door to the export of green hydrogen manufactured with Quebec electricity. “TES Canada could export hydrogen produced in Shawinigan to Germany, where its parent company is building a terminal,” he illustrated.
The integrated energy resources plan announced without the bill is widely welcomed. The Quebec Association of Renewable Energy Producers believes that it will “direct the right energies to the right place”.
Its president, Luis Calzado, reiterates his concerns about the place of private producers in future wind development, which Hydro-Québec has decided to control. He wants to take a closer look at the articles of the bill which concern supply “because, since the unveiling of Hydro-Québec’s wind strategy, independent producers are concerned about the place that will be given to them in the realization of large wind projects”.