Hydro-Québec, the provincial hydro utility in Quebec, is proposing a substantial increase in electricity rates for data centers and cryptocurrency operations. They have requested the energy board to raise rates for new data centers to 13 cents per kilowatt hour, which is about double the current rate for customers with high power consumption.
According to a press release from the utility, existing data centers connected to the grid will experience a gradual transition to the new rate over a five-year period. The increased rate will specifically apply to data centers using over 5 megawatts annually and is anticipated to take effect in the latter half of 2026 pending approval from the regulator.
In addition, Hydro-Québec is also seeking approval to incrementally increase rates over three years for blockchain and cryptocurrency operations to 19.5 cents per kilowatt hour. This adjustment aims to better align the pricing with the energy intensity and limited economic benefits of these activities.
The utility states that these adjustments are necessary to ensure that data centers and cryptocurrency operations bear the costs associated with their significant electricity consumption while still maintaining competitive pricing. The revised rates are intended to enable Quebec to maximize the value of its energy resources, especially as data center electricity usage is projected to surge by sevenfold to over 1,000 megawatts by 2035.