Canada: Hydro-Québec Distribution Issues Call For Tenders For The Purchase Of A 450 MW Block Of Wind Power

Last Updated: January 16 2014
Article by Mylany David, Anne-Frédérique Bourret and Charles Côté-Lépine

On December 18, 2013, Hydro-Québec Distribution ("HQD") officially launched call for tenders A/O 2013-01 for the purchase of a 450 MW block of wind power ("A/O 2013-01"). Eagerly awaited by the industry, A/O 2013-01 comes on the heels of the Quebec Government's adoption, on November 6, 2013, of the Regulation respecting a 450 MW block of wind energy (Order-in-Council 1149-2013) (the "Regulation") and Order-in-Council 1150-2013 respecting the economic, social and environmental concerns mentioned to the Régie de l'énergie in connection with a 450 MW block of wind energy (the "Order"). We have published, previously, an overview of the highlights of the foregoing and some of its related issues (including more stringent rules concerning guaranteed regional and Quebec content and requirements for project participation by the local community), which can be found in our September 18, 2013 and November 22, 2013 newsletters.


To begin with, the A/O 2013-01 documents repeat the requirements contained in the Regulation and the Order.

We note that the A/O 2013-01 documentation published by HQD is substantially similar to that published in connection with the previous wind power call for tenders, namely call for tenders number A/O 2009-02 for the purchase of two 250 MW blocks of wind power, for which the electricity supply contracts were executed in the spring of 2011. Therefore, most of the requirements contained in the latter still apply under A/O 2013-01.

However, we would point out certain differences from A/O 2009-02:

  • Contract term

A/O 2013-01 specifically states that the term of the electricity supply contracts can be either 20 or 25 years, at the bidder's option. This is new, since each of the three previous wind power calls for tenders that HQD issued had set the term of the electricity supply contracts at 20 years.  A/O 2013-01 does not differentiate in its treatment of the proposals based on the bidder's option for the term of the electricity supply contract.

  • Ineligible projects

In addition to the generating facilities or wind farms that were ineligible under the previous call for tenders, A/O 2013-01 adds a new ineligibility stipulation for generating facilities or wind farms "that share the same delivery point, the same interconnection point or the same switchyard with an existing wind farm which the generation is under contract and that the contractual capacity will not been fulfilled at the start of delivery of the project being submitted." We find this sentence ambiguous, for it is hard to assess this criterion at the proposal filing stage.

  • Eligible price formulas

While the previous call for tenders allowed bidders to submit their financial proposals based on (a) a 100% CPI price formula, (b) a 20% CPI price formula, (c) a price formula with a CAD/Euro exchange rate, or (d) a price formula with a CAD/USD exchange rate, A/O 2013-01 limits the eligible price formulas to 100% CPI and 20% CPI only.

  • Switchyard reimbursement

A/O 2013-01 still provides for a contribution by Hydro-Québec TransÉnergie to the reimbursement for the switchyard, and we notice an increase in the contribution for projects of less than 250 MW.

  • Variants

Unlike the conditions of call for tenders A/O 2009-02, which permitted the filing of four (4) variants of a proposal in addition to the main proposal, HQD now limits the filing of separate variants to two (2), for any main proposal. The differences the variants involve are still the same as those permitted under the previous call for tenders, namely, price, installed capacity, or the wind turbine manufacturer. Note that a different site does not constitute a variant and must instead be the subject of a separate proposal.

  • Terms of Reference

A/O 2013-01 also contains a revised version, as of October 31, 2013, of the Terms of Reference for the Siting of Wind Farms on Farmland and in Woodlands (the "Terms of Reference"). It would seem that the Terms of Reference repeat, almost integrally, the principles set out in the 2007 revised version of the Terms of Reference, although certain payments, such as payments for the execution of an option contract, have been revised upwards.

At this stage, there is still some uncertainty as to whether the Terms of Reference are a mandatory condition for proposal eligibility. Indeed, the A/O 2013-01 documents only mention that HQD "is urging bidders to apply the Terms of Reference," while the standard electricity supply contract (appended to the call for tenders documents) contains a schedule where the supplier makes a specific undertaking to comply with the Terms of Reference. On this issue, it should be noted that under the previous call for tenders, HQD gave extra weighting to bidders that undertook to comply with the Terms of Reference. No such extra weighting is currently provided for in A/O 2013-01.

  • Financial contributions 

As provided in the Regulation, all accepted projects must pay the local municipality, the regional county municipality (or MRC) or the Native community an amount of $5,000 per MW installed in the territory of such local municipality, RCM or Native community. The A/O 2013-01 documents stipulate that every bidder must provide a copy of the agreements signed with the municipality, MRC or Native community to its proposal.

In our November 22, 2013 newsletter, we raised certain issues concerning the application of the requirement to pay financial contributions in the event a project's wind turbines are located at one and the same time in the jurisdiction of a local municipality or RCM and/or lands claimed by a Native community. We see that the A/O 2013-01 documents offer no clarification on the question of sharing financial contributions between several host communities.

  • Attestation from the Revenue Quebec and application of An Act respecting contracting by public bodies

In the wake of the various recent legislative amendments designed to tighten the rules for the awarding of public contracts, the A/O 2013-01 documents stipulate that every bidder that has an establishment in Quebec must attach an attestation from the Agence du revenue du Québec stating that the bidder has filed the returns and reports it was required to file under the tax laws and that it has no overdue accounts owing to the Minister of Revenue of Quebec.

Similarly, the documents stipulate that a bidder that is ineligible or is subject to a prohibition to enter into a public contract under An Act respecting contracting by public bodies or the Election Act cannot submit a bid or sign a contract further to this call for tenders. The standard electricity supply contract contains an undertaking to that effect, which must remain in force throughout the entire term of the project.

  • Control

As required by the Regulation, participation in A/O 2013-01 is reserved for power suppliers that can demonstrate that the local environment has a participation in the control of the project representing 50% or more. The standard electricity supply contract contains, in section 24.7, the following definition of what constitutes control as understood under A/O 2013-01:

"For purposes of this section, the local environment's percentage of the interest in the control of the wind farm is equal to the percentage of votes held directly or indirectly by the local environment in the stock, units or other ownership titles of the Supplier, giving a right to vote on the election of the Supplier's directors or any person in charge of the Supplier's administration. [...]"


Here is the timetable for the A/O 2013-01 milestones:


We invite potential bidders to carefully review the A/O 2013-01 rules. We recommend that the following preliminary steps be taken:

  1. Register promptly for one of the preparatory conferences and the call for tenders process;
  2. Review all previously executed option contracts to ensure that they allow you enough time for your projects to meet the established commissioning dates;
  3. Review the sample deeds of superficies to ensure that the term is long enough in the event of a proposal for a 25-year supply contract;
  4. Enter into agreements pertaining to the control by the local environment in accordance with the requirements of A/O 2013-01;
  5. Enter into written agreements with the relevant municipalities, RCMs or Native communities regarding the payment of the financial contributions, as required by A/O 2013-01; and
  6. Submit any questions as soon as possible, and in any event before August 18th, regarding any requirements you may find ambiguous.

We invite you to consult a Dentons Canada professional for any further questions about A/O 2013-01 or for assistance in preparing your proposal, or on any legal question pertaining to commercial law, real estate law, environmental law, aboriginal law, tax law, or other legal matters.

About Dentons

Dentons is a global firm driven to provide you with the competitive edge in an increasingly complex and interconnected marketplace. We were formed by the March 2013 combination of international law firm Salans LLP, Canadian law firm Fraser Milner Casgrain LLP (FMC) and international law firm SNR Denton.

Dentons is built on the solid foundations of three highly regarded law firms. Each built its outstanding reputation and valued clientele by responding to the local, regional and national needs of a broad spectrum of clients of all sizes – individuals; entrepreneurs; small businesses and start-ups; local, regional and national governments and government agencies; and mid-sized and larger private and public corporations, including international and global entities.

Now clients benefit from more than 2,500 lawyers and professionals in 79 locations in 52 countries across Africa, Asia Pacific, Canada, Central Asia, Europe, the Middle East, Russia and the CIS, the UK and the US who are committed to challenging the status quo to offer creative, actionable business and legal solutions.

Learn more at

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances. Specific Questions relating to this article should be addressed directly to the author.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:
  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.
  • Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.
    If you do not want us to provide your name and email address you may opt out by clicking here
    If you do not wish to receive any future announcements of products and services offered by Mondaq you may opt out by clicking here

    Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

    Use of

    You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


    Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

    The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


    Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

    • To allow you to personalize the Mondaq websites you are visiting.
    • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
    • To produce demographic feedback for our information providers who provide information free for your use.

    Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

    Information Collection and Use

    We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

    We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

    Mondaq News Alerts

    In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


    A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

    Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

    Log Files

    We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


    This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

    Surveys & Contests

    From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


    If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


    From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

    *** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .


    This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

    Correcting/Updating Personal Information

    If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

    Notification of Changes

    If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

    How to contact Mondaq

    You can contact us with comments or queries at

    If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.

    By clicking Register you state you have read and agree to our Terms and Conditions