Quebec businesses are not having an easy time these days. After COVID-19, the labor shortage, the inflationary surges and the growing protectionism in the United States, another tile threatens to fall on them: the increase in industrial electricity rates which could increase by 60% within ten years due to the government’s energy reform. Imagine your rent or mortgage suddenly experiencing such a drastic increase. For most of you, moving would become obvious.
Knowing that energy costs often represent between 20% and 60% of the operating or production costs of businesses, this increase directly threatens the economic fabric of Quebec and thousands of jobs, particularly in the regions there. where there is a high concentration of manufacturing companies. For these regions, the anticipated increase amounts to a tax on their jobs.
As the study of energy reform comes back into the news, our seven organizations are uniting their voices to demand a change of direction. Grouped under the banner of the Alliance for Energy Competitiveness of Quebec (ACEQ), we urge the government to change direction and act now to protect the economy of Quebec’s regions.
The Eldorado of electricity prices: a myth to be deconstructed
Quebec has long benefited from cheaper electricity rates than elsewhere, a strategic advantage that has allowed it to build a strong economy, attract investments and position itself internationally. However, those days are over.
While rates are stable or even falling among our neighbors, Quebec is heading in the opposite direction. With what it is proposing in its current reform, the CAQ government is accelerating the erosion of our energy competitiveness. This situation could lead to a spiral of disinvestment and put jobs at risk.
A balance between Hydro-Québec’s profits and Quebec’s economic vitality
Our organizations are not asking for discounted electricity from the government, nor are they asking for favors for businesses. We are aware of the challenges linked to the energy transition and the inevitable increase in prices. There is no point in contrasting residential rates with those of businesses. We all have the same concerns.
What we are demanding is that electricity rates remain competitive and be established in a transparent and predictable manner, based on the real cost for Hydro-Québec, including a reasonable profit, all determined by a third-party and impartial organization, the Energy Authority. The search for revenue for the Quebec government must not be at the expense of Quebec’s economic vitality and its jobs. A fair balance must be found in the best interests of all clienteles and of Quebec as a whole.
The government’s choices regarding electricity rates will have repercussions on the entire Quebec economy, and particularly in regions where businesses of all sizes are often the economic engine. The effects will be felt as much by SMEs that revolve around large industries as by workers and their families.
There is still time for the government to adjust its reform. Because if several factors of business competitiveness escape the direct control of the government, this is not the case for establishing electricity pricing. We extend our hand to collaborate and find solutions that will ensure the sustainability of our businesses.
- Jocelyn B. Allard, president, Quebec Association of Industrial Electricity Consumers
- Karl Blackburn, President and CEO, Conseil du patronat du Québec
- Dimitri Fraeys, Vice-President, Innovation and Economic Affairs, Quebec Food Processing Council
- Yves Hamelin, Regional Director, Quebec, Canadian Chemical Industry Association
- Jean-François Samray, President and CEO, Quebec Forest Industry Council
- Jean Simard, President and CEO, Aluminum Association of Canada
- Julie White, vice-president of public affairs and interim spokesperson, Quebec Manufacturers and Exporters
