Québec Energy Update: Government Announces its Intent to Relaunch “Small Hydro”
On May 21, 2014, Mr. Philippe Couillard, Premier of Québec, presented his inaugural speech at the National Assembly (available here in French only). This was Mr. Couillard’s first inaugural speech which laid out the priorities and guiding objectives that his newly-elected government intends to follow and implement within the next four years.
Below are selected highlights from the inaugural speech that are of interest for the Québec energy sector.
The Government announced its intent to relaunch the private hydroelectricity procurement program. This program involved purchases of electric power by Hydro-Québec from privately-owned 50 MW and less hydroelectric projects (often referred to as “small hydro”). This program had been cancelled early last year by the former Government on the basis that Hydro-Québec had significant electricity surpluses and therefore had no need for additional electric power procurement. Mr. Couillard also mentioned that the participation of First Nations in the “small hydro” projects would facilitate governmental and other regulatory approval process.
Use of Electricity
Mr. Couillard announced his Government’s intention of strategically using electricity surpluses to secure industrial investments and reinforce the manufacturing industry in Québec. Additionally, the Government intends to continue its efforts for generally electrifying transports, including public transport in Québec. The Government also wishes to benefit from increasing demand for aluminum and availability of renewable energy generated in Québec to implement an industrial strategy to further develop and maintain the aluminum industry in Québec.
Oil and Gas
The Government intends to use the review of the tax and financial regime for Québec’s municipalities to address the sharing with local communities of oil, gas and mining royalties derived from resources within their respective territories.
The Government also wishes to initiate a thorough strategic and environmental review of the hydrocarbon industry in Québec.
Mr. Couillard further announced that the Government would pursue the implementation of its climate change action plan with an objective of reducing, before 2020, Québec’s GHG emissions by 20% below their 1990 level.
With respect to Québec’s sustainable development, the Government intends to support the following initiatives:
- Continue the project of electrifying transportation;
- Intensify the energy efficiency efforts;
- Favor the usage of natural gas instead of diesel and heavy oil;
- Continue the development of the carbon emission trading exchange.
These announcements are, in substance, in line with the recommendations of the Commission sur les enjeux énergétiques du Québec. See our blog post on the report of the Commission discussing those recommendations here.
Mr. Couillard will relaunch the “Plan Nord”, Québec’s major northern resources development plan (notably mining, infrastructure and energy). The “Plan Nord” had been adopted by the previous Liberal Government, but was modified by the former Parti Québecois Government. In addition to specifically assign a minister to oversee the “Plan Nord”, the Government will also create a “Plan Nord” secretariat that will coordinate the implementation of the “Plan Nord”, the sharing of the benefits with the regions involved and the respect of First Nations’ rights.
The Government also promised improved stability and predictability for the mining industry, including the implementation of better practices.
We will closely monitor further developments with respect to these announcements.
climate change Electricity Hydro-Québec mining Oil and Gas Philippe Couillard plan nord Province of Quebec provincial Quebec Québec National Assembly small hydro sustainable development