On August 28, 2013, the Government of Québec published a
draft regulation regarding the procurement of an additional 450 MW
of wind energy capacity through a request for proposals (RFP)
process. This is an important step towards the realization of this
procurement, which was originally announced in May 2013 as part of
a plan to procure an additional 800 MW of wind energy
The proposed terms and conditions of this 450 MW procurement,
including maximum price and deadlines for delivery, are reflected
in the draft regulation. It provides that this procurement is
to be through an RFP process, with 300 MW allocated to projects in
the Gaspésie-Îles-de-la Madeleine and Lower St.
Lawrence regions and 150 MW for projects throughout the
The draft regulation sets a maximum price of 9.5¢/kWh for
this block of energy in 2014 dollars, adjusted for Consumer Price
Index, including the cost of balancing service and supplementary
capacity. It should be noted that these costs were excluded
from the calculation of maximum prices in recent RFP's for wind
This 450 MW block of wind energy capacity is reserved for
suppliers who demonstrate that:
The local community holds a participation representing more
than 50% of the control of the project;
The project is recognized by a resolution of the regional
county municipality and any local municipality where the project is
The draft regulation defines "local community" as
being composed of one or more of the following:
regional county municipality;
intermunicipal management board.
These projects must be connected to Hydro Québec's
main network as follows: 225 MW by December 1, 2017 and 225 MW by
December 1, 2018.
This draft regulation may be adopted by the Government of
Québec 45 days after the date of its publication, and is
subject to change in this period. Interested persons may
submit written comments to the Ministry of Natural Resources during
this period. The final regulation will form the basis for the RFP
to be issued by Hydro Québec Distribution, a division of the
province-owned power utility. The terms and conditions of the
RFP will then have to be submitted to the provincial energy
regulator, the Régie de l'énergie, for
The preamble of the draft regulation states that the proposed
delivery dates ensure stability in the increase of wind energy
supply and manufacturing activity. Although the draft
regulation does not mention it, if previous practice is followed,
the upcoming RFP may stipulate regional and provincial content
In addition to this 450 MW block, the Government's
announcement of May 2013 also mentioned a 200 MW block to be
allotted to Hydro-Québec Production, a division of
Hydro-Québec, the province-owned power
This May 2013 annoucement also referred to a 150 MW block
reserved through a dedicated purchase program for the three
Mi'gmaq First Nations of Québec, which are based in the
Gaspé peninsula where many of the province's wind farms
are located. Legislation was subsequently adopted in June
2013 to permit the Government of Québec to exempt Hydro
Québec Distribution, another division of the power utility,
from the RFP requirement of that Act for an energy block of up to
150 MW for supply contracts with "suppliers connected to a
Currently, Québec is Canada's second largest
producer of wind energy, with a total of more than 1,700 MW of
installed wind energy capacity, representing roughly one-quarter of
all wind energy capacity in Canada. This additional
procurement reflects the goal of Québec's 2006-2015
Energy Strategy to have a total of 4,000 MW of installed wind
Investors and prospective market entrants will find
opportunities in this procurement as there will be significant
demand for turbine and balance of plant supply, early and later
stage investment capital and advisory consulting
With regard to future opportunities for wind and renewable
energy development in Quebec, it should be noted that the province
is commencing a broad public consultation process early in the fall
on the province's long-term vision for the energy
industry. This consultation will be carried out through a
Commission (Commission sur les enjeux
énergétiques) that will conduct hearings
throughout the province. Please refer to the
Public Consultation on Energy Issues in
Québec" article for more details on
Among other things, this process will help to shape
Québec's future energy policy which is expected to
reflect the province's commitment to reduce greenhouse gas
emissions. The details of Quebec's new Energy Strategy are
expected to be unveiled in 2014.
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guide to the subject matter. Specialist advice should be sought
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