(Quebec) The Legault government will subsidize consumers of green hydrogen and biofuels to stimulate this sector in which it plans to inject 1 billion by 2026.
Posted yesterday at 4:30 p.m.
“If we want to develop expertise in Quebec, and this sector, momentarily, in a cyclical way, we will come to support a cost difference, it can be for green hydrogen, as for biochar or pyrolytic oil”, says the Minister of Energy, Jonatan Julien, in an interview with The Press.
Mr. Julien is presenting today his strategy on green hydrogen and bioenergies. Quebec will invest $1 billion by 2026 to help businesses that produce these renewable energies, to support businesses that want to convert their machinery to use these new fuels. In its arsenal, the Legault government provides for “grants, tax credits, loans, loan guarantees, debentures, equity investments”, and wants to “transitionally cover the operating costs for the conversion to renewable electricity, at green hydrogen or bioenergy”.
He also wants to outright subsidize the price of these fuels. The strategy provides for the establishment of “financing mechanisms to reduce the price differentials with respect to gray hydrogen or fossil alternatives”.
Uncompetitive price
“Hydrogen costs between two and five times more expensive than gray hydrogen. People agree that this gap will narrow. Companies say: ‟I would be interested, but the bioenergy molecule is more expensive.” We say: yes, but it will reduce over time. We will bear this cost difference so that the demand [de bioénergie] meets the cost of the offer,” says Mr. Julien.
The government document presented by the Minister emphasizes that “certain energy sectors with a low carbon footprint, including green hydrogen and bioenergies, are not very competitive compared to their fossil competitors. Beyond the investments related to the replacement of equipment, the additional costs of certain renewable energies constitute one of the main obstacles to the energy transition”.
Mr. Julien’s plan also relies mainly on biofuel technologies. Nearly 80% of the sums provided for in its strategy are devoted to them, the rest being allocated to green hydrogen, which has yet to prove itself.
Not for export
While Minister Julien is very happy to export Quebec hydroelectricity to help the United States decarbonize, he is much more reluctant to create a hydrogen industry for export.
“We do not intend to promote the export of green hydrogen outside of Quebec or ammonia. For us, we have a competitive advantage: Hydro’s competitive rates. The production of green hydrogen will be used to decarbonize Quebec. The competitive advantage we have with our hydroelectricity, we are not going to use it to decarbonize another nation,” he says.
As for biofuels, the government strategy is broad. It will be able to help municipalities that wish to transform their waste into biogas, as well as the agricultural sector. But it is the forestry sector, which “has the greatest potential for producing bioenergy”.
The idea is to transform logging residues, as well as “wood without takers, such as pulpwood, small stems or low quality wood” into bioenergy. “These woods would have been abandoned on the harvest beds, had it not been for the outlets for bioenergy. »
According to the Legault government, this strategy will reduce the consumption of petroleum products by 1 billion liters annually, or 16% of its reduction target, which is 40% by 2030. This would cause a drop in GHG emissions. of 4 megatons in 2030.
Quebec will also invest nearly $125 million in research related to biofuels and green hydrogen.