Energy bill opens the door to Hydro-Québec charging more for peak hours (2024)

QUEBEC — At the same time as saying the increase in residential hydro rates will stay capped at three per cent through 2026, the Legault government has opened the door to allowing Hydro-Québec to charge consumers different power rates depending on the time of day.

Economy and Energy Minister Pierre Fitzgibbon included the idea of variable daily rates in a sweeping bill on the governance of energy resources tabled Thursday, as Quebec tackles the challenge of reducing consumption and doubling its power production in the next 25 years.

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The province has already set a goal of becoming carbon neutral by 2050. That requires more power to replace fossil fuels.

“We will encourage people (to save power) with a carrot, not a stick,” Fitzgibbon said at a news conference to explain the legislation, called Bill 69.

Quebec could save between 2,000 and 4,000 megawatts of power a year by staggering rates and cutting its consumption, the equivalent of two hydro dams that would not have to be built, Fitzgibbon added.

“In the final analysis, the best future supply of energy is the power we don’t consume,” he said, insisting the issue will be up for debate in the fall when hearings are held on the new bill.

Fitzgibbon floated the idea of variable daily rates with a certain self-deprecation, releasing a promotional video in which he is seen loading his dishwasher in the dark. The video is a reference to his pitch last year for Quebecers to show some power “sobriety” by running their dishwashers during off-peak hours in the middle of the night.

But Article 130 of his legislation covering rates is clearly worded.

It states that as of April 1, 2026, the independent Régie de l’énergie must set “one or more electric power distribution rates … in such a manner as to promote the reduction of electrical power consumption during peak periods.”

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The language suggests Quebecers would pay more for power at certain times of day as a way to discourage waste.

This is the third time since the Coalition Avenir Québec was elected in 2018 that the government has tried to alter hydro rate structures. In 2019, it used closure to adopt a bill bypassing the Régie’s decision-making process, pegging rate increases to the level of inflation.

That plan blew up in the government’s face during the COVID-19 pandemic when inflation soared, much to the grief of citizens. Quebec then scrapped that law, adopting another bill setting the rate of increase to a maximum of three per cent per year.

Moving to deflect citizen concerns, Fitzgibbon’s new bill includes the creation of a financial aid program that would limit the effect of any residential hydro increase after the 2026 deadline, which is also the year of the next election.

Industrial clients, however, are not included in the three per cent ceiling, a situation that has many large power consumers concerned.

In tabling the bill, the last major piece of legislation to be presented by the government before the house recesses for summer on Friday, Fitzgibbon wants to set in motion a public debate on Quebec’s energy future — a theme that goes beyond the eternal debate about rates.

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Fitzgibbon said everything is on the table, including dams, wind farms, solar power and beyond.

“We want to have an integrated resources plan, one that Quebec has never had to produce given that we had surpluses and nobody was really concerned,” he said. “We are setting the table for Quebecers to discuss.

“Do we want to decarbonize? Yes. Do we want Churchill Falls, yes or no? If not, we need 25 dams. If it’s yes, maybe we need 15 dams. If there are no dams, we’ll do more wind power, but some will say ‘not in my backyard.’

“So that’s the debate we need to have.”

Quebec gets about 15 per cent of its power from the Newfoundland and Labrador Churchill Falls project. The original deal between the two provinces, set to expire in 2041, is currently being discussed by the two governments to see if Quebec can get more power from the project so it can produce less itself.

The bill takes certain immediate steps to deal with the looming power crunch by loosening and speeding up the approval process to get projects of all kinds off the ground. Hydro-Québec, for example, would no longer have to issue a call for tenders for its supply contracts.

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In some cases, projects will not have to go before the Régie for approval.

Private industrial power producers will also be allowed to distribute their surpluses to other clients on the same territory without going through Hydro-Québec, which is another way to reduce demand on the public power grid.

While the government is mostly concerned about large projects, the bill opens the door to relaunching private mini-generating stations such as municipal dams and those owned by Indigenous communities by increasing the maximum legal generating capacity to 100 megawatts.

The government is giving itself a year to present an integrated plan detailing its objectives and targets.

“It’s ambitious, but we’re doing it for future generations,” Fitzgibbon says in his video. “We are doing it for our planet. We are doing it for a more prosperous Quebec, a greener Quebec, a prouder Quebec.”

Reaction to Fitzgibbon’s bill was mixed starting with business saying it is concerned it will end up paying higher rates to make up for the modest increases residential users pay.

“This choice aggravates and is to the detriment of small and medium sized business and will put pressure on Quebec’s public finances,” the Canadian Federation of Independent Businesses said in a statement.

The Conseil du Patronat, the province’s largest employer group, agreed. The prospect of rate increases is a source of concern to its members because “it risks undermining their ability to compete,” it said.

But the Manufacturers and Exporters of Quebec welcomed the bill, saying it will modernize the management and planning of Quebec’s energy needs.

Greenpeace said the bill appears to open the door to more energy privatization, which could be bad for the environment. It would also be a betrayal of the “rich heritage,” the nationalization of energy produced for all Quebecers.

pauthier@postmedia.com

twitter.com/philipauthier

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