Hydro-Québec to face off against industry actors like Google in data centre hearing

A Hydro-Québec proposal to double energy costs for data centres will be examined at a public hearing in Montreal. The hearing will pit tech giants like Google against the provincial utility. Hydro-Québec seeks to have the Régie de l’énergie, Quebec's energy regulator, implement a new electricity rate for data centres exceeding five megawatts.

This would raise energy prices to approximately 13 cents per kilowatt hour, roughly double the current rate for large-power customers. The hearing, set to continue until October 9, will include participants from various sectors, such as the Canadian Federation of Independent Business. Hydro-Québec argues that higher rates could mitigate the effect of increasing data centre energy demand on residential rates.

Currently, energy costs for data centres in Quebec are around six cents per kilowatt hour, significantly lower than in most other regions. Energy analyst Jean-François Blain explained that this lower rate benefits Quebec as long as it can supply companies at an affordable price. However, with growing energy demand and costs, Blain cautioned that Hydro-Québec may struggle to maintain this advantageous price for data centres indefinitely.

The new rate would align their costs more closely with those of other areas. Data centres subject to the new rate currently consume 190 MW at peak demand and could reach 1,000 MW by 2035. The provincial energy regulator will determine if the new rate is fair and sustainable.