Hydro-Québec defends variances

Re: “Group demands $1.4B payback from Hydro-Québec over bills” (Montreal Gazette, April 19)

Hydro-Québec’s earnings variances, also referred to as earnings surpluses, have made the news rounds lately. A great deal of false information has been spread, and the time has come to set the record straight.

Between 2008 and 2015, there was never any overbilling. For each of those years, the Régie de l’énergie set the rates after an analysis period that spanned several months and closely scrutinized by dozens of independent experts.

During this period, HydroQuébec performed better than expected, thanks to better cost controls. Since 2007, Hydro-Québec has decreased its staff by 3,300 employees, while adding 346,000 customers to its network. The earnings variances stem directly from this productivity boost.

Hydro-Québec customers and all Quebecers have benefitted from the earnings variances. First of all, the productivity we gained from improving our processes translate, year after year, into limited rate hikes. For example, the rollout of nextgeneration meters generates $80 million in savings per year.

The earnings variances are also a boon to Quebecers through the dividends paid by Hydro-Québec to the government every year, under the Hydro-Québec Act.

Hydro-Québec submits its rate applications 20 months before the end of the year they cover. Economic parameters, such as interest rates and economic growth, may fluctuate. Hydro-Québec Distribution has a $12 billion annual budget. Earnings variances over the past few years have been no larger than one per cent — so accurate 99 per cent of the time.

Hydro-Québec is firmly committed to continuously improving its productivity. Our efforts and results allow us to offer our customers the lowest electricity rates in all of North America. We take great pride in them. David Murray, President, Hydro-Québec Distribution