4 things that we’re keeping an eye on as Quebec’s energy future is taking shape

Published on February 15, 2024

We’re at an important moment in time for Quebec energy. The era of Hydro-Québec surpluses is coming to an end and the government is preparing significant changes towards its vision for the province’s energy transition.

Without transparency or an overarching strategy, the government’s vision of our energy future remains hazy as it prepares to table legislation to amend the laws governing Hydro-Québec and the Régie d’énergie this winter. There are a number of things that we must keep an eye on as this process unfolds…

Here are four issues that Équiterre is monitoring closely, which concern all Quebecers as well as the economic forces involved.

1. Promoting our hydroelectricity at discount prices to attract businesses to Quebec

Our Minister of Economy, Innovation and Energy, Pierre Fitzgibbon, attends international conferences to promote Quebec as an ideal place for companies who wish to green their operations to set up shop, thanks to our renewable hydroelectricity offered at a low price. It’s therefore not a surprise that there’s a long list of industrial projects on his desk. But the problem (among others) of this strategy is that Hydro-Québec does not have the capacity to meet the demand of all these new industrial customers.

Decisions will have to be made. Who will get priority to use our hydroelectricity? Who will have to pay more? Are there other ways to respond to the demand of these new customers while still being able to meet the needs of existing ones? And if so, what would be the associated socio-environmental impacts, and how can we ensure that they are taken into account in the decision-making process? We’re keeping an eye on it🧐

2. Self-generation of energy by businesses and the possibility of selling surpluses

Increasing the self-generation of energy by businesses is a path that the government seems to be considering in order to meet the industrial demand described above. You’d like to set up shop here, but Hydro-Québec can’t supply you with all the hydroelectric power that you need? You could simply build your own windmills or solar panels to power your operations. This type of self-generation is legally permitted, but has very seldomly been used to date, because Hydro-Québec has largely been able to satisfy the demand. But if many of the businesses on Minister Fitzgibbon’s list were to adopt this model…

The construction of energy infrastructures is no trivial matter. There are major costs and a significant need for material, human and land resources, which often raises social acceptability issues. It’s one thing if the end goal is to supply Quebecers with clean energy and to decarbonize our society, but it’s quite another if the goal is to power a data storage facility, for example.

And it seems that the government is not only encouraging businesses to take this path, but it may also amend the law to allow them to sell their surplus generation to another business… which would put an end to Hydro-Québec’s monopoly.

Is this the best path for Quebec? What would be the impacts of this major change in our electricity distribution model? It’s complicated. We’re keeping an eye on it🧐

3. Weakening regulations to allow new industrial customers to bypass our public participation mechanisms

Northvolt is a much-discussed example of how the Quebec government has been allowing companies to circumvent certain public participation rules in the past year.

At a time when massive new industrial projects are on the table, the fact that the government is weakening our environmental protection and public consultation mechanisms is extremely concerning. Équiterre has been calling on the government to respect these mechanisms – to do better on protecting the environment, and to do so in a more coherent, transparent, participatory and responsible manner. We encourage you to add your voice to ours.

4. The obstacles that the provincial government has created for municipalities who are working to decarbonize their buildings

Many municipalities are taking action on climate by seeking to limit the use of fossil gas in their buildings. To do so, they must be able to count on the availability of hydroelectricity.

But the government and Hydro-Québec (and Énergir, but that’s another story) seem to be wary of these initiatives, given that current hydroelectric surpluses are low. With its Bill 41 on energy efficiency in buildings, the government seems to want to regulate and limit municipal action to get gas out of buildings, arguing that municipalities "don't necessarily have the expertise to determine the impact of their decisions on energy security"(translation).

Here's example from Montérégie, where Hydro-Québec informed the City of Saint-Bruno-de-Montarville that banning natural gas from its future eco-neighbourhood would be a bad idea.

Once again, decisions will have to be made. At a time of dwindling energy surpluses, who should have priority to use our valuable hydroelectric resources? The residents of an eco-neighbourhood or a battery factory? The answer to this question will be decisive. We’re keeping an eye on it🧐

The energy transition is necessary but complicated

There are clearly a host of major issues and diverging perspectives and priorities when it comes to the energy transition. The will and the drive is there, but there isn’t unanimous consensus on the way to get there. And the methods employed so far are not yielding the desired results, mainly because of energy overconsumption.

According to l’État de l’énergie au Québec, prepared by the Chaire de gestion du secteur de l’énergie à HEC Montréal, we still haven’t managed to reduce demand. Quebec is consuming an ever-greater amount of energy – more renewable energy, yes, but we’re also consuming more fossil energy. Renewable energy has unfortunately not yet supplanted fossil fuels. We’re simply adding energy sources instead of transitioning from one to the other.

To properly address these major issues, Quebec needs a proper public debate. The government’s decisions must reflect the will of the citizens. For that to happen, the public needs to be well informed and must be consulted so they can take part in the debate.

Because we can’t have everything. Choices will have to be made.