This year, the government was forced to reject nearly half of the major development projects it was due to consider due to lack of electricity.
Entrepreneurs have submitted projects to the Ministry of Energy for which they would be responsible for finding the financing themselves. This category of projects would require at least 5 megawatts each of electrical power.
In total, they filed enough projects to need 21,000 megawatts of power capacity. These are greenhouses, manufacturing companies and other potential employers.
The problem is that there would only be 1,000 megawatts of unallocated power left in Hydro-Québec facilities.
The Minister of Energy, Pierre Fitzgibbon, was therefore forced to reject many of these projects due to lack of power capacity. Far from being the engine of development that we were once promised, Hydro-Québec is becoming an obstacle to the development of the province.
In other words, Hydro-Québec expects to lack power during winter peaks from 2027 based on its current installations. This means greater periods of downtime on production lines in our factories subject to the interruptible tariff, costing our economy millions of dollars per hour, with the expected effects on our competitiveness and our ability to attract investments. This also causes fears about the ability of the state monopoly to meet the needs of an electrified Quebec.
Faced with this situation, we understand why Mr. Fitzgibbon sees a certain urgency in massively increasing Hydro-Québec’s production capacity. According to him, it would be necessary to build the equivalent of a second Hydro-Québec — or add 200 terawatt hours of annual production — to meet the growing needs of the province by 2050.
We understand that the needs are important. We also understand, like the minister, that Hydro-Québec will not succeed alone.
This is where the issue of independent electricity producers comes into play. These producers are already building and operating production facilities in Quebec and elsewhere — ranging from small hydroelectric dams to enormous fields of wind turbines and solar panels.
Boralex, for example, the Kingsey Falls, Quebec-based company, operates more than a hundred electricity production and storage facilities around the world. With these independent installations, this Quebec flagship sells the energy it produces to various local consumers or distributors, such as the University of California.
However, in Quebec, companies are forced by law to only sell their electricity to Hydro-Québec. However, even if some of their dams have a higher production potential, Quebec law requires them to have a maximum production capacity of 50 megawatts.
By freeing the hands of independent producers like Boralex — both by allowing them to increase the production capacity of their operations and by giving them direct access to industrial customers — the government would help stimulate investment in electricity production and , ultimately, to reduce, or even cancel, the limiting effect on our development of a lack of Hydro-Québec production capacity.
Reviewing the regulatory environment to unlock the potential of independent producers is one of the elements in the minister’s toolbox that would increase the province’s electricity capacity.
As usual, this offends certain large organizations which benefit from the current monopoly. The major unions, for example, unanimously deplored the fact that the arrival of the bill “will facilitate the privatization of energy production methods and their diversification by creating favorable conditions for new energy sectors” .
Far from being negative, the creation of new energy sectors will precisely complement Hydro-Québec’s offer. No offense to the various Hydro-Québec unions, the state-owned company needs reinforcement to respond to the challenge facing Quebec.
To ensure a full contribution from independent producers, liberalization of the sector will necessarily have to be at the heart of the energy reform bill.
This approach would allow a full entrepreneurial contribution to the energy sector, and ultimately promote a prosperous and resilient Quebec economy.
After all, it would cost far too much to put the development of Quebec and the creation of quality jobs on hold because our state monopoly can no longer meet the demand for electricity.