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Hydro-Québec takes partnerships, environmental measures and sharing of wealth to new levels

Published

5 years ago

10 minute read

The Canadian Energy Compendium is an annual Energy Council of Canada initiative which provides opportunity for cross-sectoral collaboration on a topic of shared interest across the Canadian energy sector, produced with the support of Canada’s national energy associations and Energy Council of Canada’s members. The stories contributed to the 2019 edition, Indigenous Energy Across Canada, highlight current conversations celebrating Canada’s dynamic energy sector and encouraging its continuous improvement.

Thanks to Todayville for helping us bring our members’ stories of collaboration and innovation to the public.

Click to read a Foreward from JP Gladu, Chief Development and Relations Officer, Steel River Group; Former President & CEO, Canadian Council for Aboriginal Business

JP Gladu, Chief Development and Relations Officer, Steel
River Group; Former President & CEO, Canadian Council for Aboriginal Business

THE THIRD PHASE OF JAMES BAY DEVELOPMENT: TAKING PARTNERSHIPS, ENVIRONMENTAL MEASURES AND SHARING OF WEALTH TO NEW LEVELS

This article, submitted by Hydro-Québec, will focus on the development of the third phase of the James Bay complex, namely the generating stations namely the Eastmain-1 and Eastmain-1A/Sarcelle/Rupert project. Emphasis will be placed on the development of a new relationship with the Cree that led to an improved project development model.

The Eastmain Complex, the most recent of the James Bay hydroelectric development: Taking partnerships, environmental measures and sharing of wealth to new levels.

When the initial phases of hydropower development in the Baie-James region of Québec was launched in the 1970s, there was no law on the environment, no environmental ministries and no environmental impact assessment process. So consulting affected communities wasn’t on anyone’s agenda and wasn’t yet part of Hydro-Québec’s approach. In the new millennium, with a new phase of development in this region, close-knit partnerships with the Cree Nation have become the cornerstone of project development throughout Québec.

Nadoshtin and Boumhounan agreements paved the way to new developments in Baie-James in the 2000s

The Nadoshtin agreement (2002) between the Crees and Hydro-Québec opened up the possibility of building and operating the Eastmain-1 hydropower project, while the Boumhounan agreement (2002) provided a framework for the Eastmain 1- A/Sarcelle/Rupert project. The key to success for the Eastmain projects was partially diverting the Rupert River’s flow northward.

But Hydro-Québec’s commercial interest in this new project had to be balanced by clear and extensive measures to preserve the surrounding environment and respect host Cree Nation and Cree communities.

In the framework of the Eastmain-1 project, Hydro-Québec made a number of commitments with a view to

  • reduce the project’s impacts on the environment
  • protect the Cree way of life and encourage partnerships with the Cree communities
  • encourage the awarding of contracts to Cree businesses
  • promote the training and hiring of Cree workers.
  • built local capacity

“…The company wanted to do more than minimize environmental impact; Hydro-Québec wanted community members to see positive gains from the Eastmain developments…”

From the design stage, which was carried out in concert with the Cree, the Eastmain 1-A/Sarcelle/Rupert project incorporated many environmental protection measures, reflecting the Cree traditional knowledge of the community members they consulted. The Cree of Québec were involved in all stages of the project, ensuring they had a voice in how their land would be impacted.

Photo courtesy Hydro-Québec. Yellow sturgeon are raised in a fish hatchery and released into their natural habitat in mid-September, when they have reached a certain maturity. Cree tallymen assist in releasing the fish into the Rupert River in the Baie-James region.

With input from Cree community members, Hydro-Québec devised a combination of dikes and canals to improve water flow, ensuring that the project, which diverts 71% of the river’s flow, flooded only a minimal land area. They also incorporated a substantial ecological in-stream flow and a series of weirs in the river to protect fish habitats, biological diversity, preserve the landscape, and maintain navigation and other activities in the area.

Furthermore, Hydro-Québec signed an unprecedented water management agreement with the Cree to ensure that the modulation of the ecological in-stream flow was managed in a cooperative manner.

Economic spinoffs

In addition to helping preserve the local environment, Hydro-Québec was committed to bringing growth opportunities to the Cree of Québec. The company wanted to do more than minimize environmental impact; Hydro-Québec wanted community members to see positive gains from the Eastmain developments.

Under the Boumhounan Agreement, an extensive participation program built around information and consultation with Cree stakeholders was put in place. It also made funds available for the Cree to finance fisheries, capacity building and traditional activities projects.

When the Eastmain 1A/Rupert diversion project was completed in 2013, the Cree and Hydro-Québec signed the Reappropriation Agreement, giving Cree land users the necessary support to maintain their traditional activities as long as the Rupert River diversion is in operation.

Post-project consultations: ensuring that measures were effective

The COMEX, a joint committee composed of 3 members appointed by the Government Quebec and 2 members appointed by the Cree Nation government, organized consultations with Cree communities to hear their views on the effectiveness of environmental and social mitigation measures put in place for the Eastmain 1A/Rupert diversion project. Approximately 200 members of the Cree Nation from six communities participated in the consultations organized in November 2012.

Photo courtesy Hydro-Québec. Between 2002 and 2005, prior to the impoundment of the Eastmain-1 reservoir, 50 archeologists and Cree workers undertook archeological digs. They discovered 158 sites and their work shows that the Baie-James territory has been occupied by these populations for the last 5,000 years.

The major findings of the COMEX were as follows:

  • […]”the Committee is convinced that the Eastmain-1-A and Sarcelle Powerhouses and Rupert Diversion Project will have contributed to greater understanding between all the parties concerned, to greater Cree involvement in the development of the territory, and perhaps to empowering them to achieve their long- term economic and community development goals.”
  • “Compared to previous projects carried out in the territory, the Eastmain-1- A/Sarcelle/Rupert project included more adequate and an unprecedented number of mitigation and compensation measures, for both environmental and social impacts. Many of these measures are aimed at helping Cree land users reclaim the territory. A new approach was developed and the Crees have benefited from the partnerships built with the proponent, thereby forging a new relationship.”
  • “Hydro-Québec was proactive, exceeding the requirements of the certificate of authorization in an effort to minimize the project’s impacts and ensure greater Cree involvement in environmental and social follow-up activities.”
  • “Hydro-Québec went to great lengths to ensure that Aboriginal communities derive benefit from the project.”

A new project development model

The Eastmain Complex – the most recent phase of development in Baie-James – added a potential energy output of 8.7 TWh per year, enough to power more than 500,000 Québec homes. The new relationships that Hydro-Québec and the Cree Nation developed over that period have become models for future energy resource development throughout Québec. With considerable untapped hydropower potential and a strong wind potential in Québec, Hydro-Québec’s new and improved project development model holds great promise for the future of clean energy in northeast North America.

Jacob Irving, President of Energy Council of Canada

The Canadian Energy Compendium is an annual initiative by the Energy Council of Canada to provide an opportunity for cross-sectoral collaboration and discussion on current topics in Canada’s energy sector.  The 2020 Canadian Energy Compendium: Innovations in Energy Efficiency is due to be released November 2020.

Click to read comments about this series from Jacob Irving, President of the Energy Council of Canada.

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Alberta

Carney forces Alberta to pay a steep price for the West Coast Pipeline MOU

Published on November 27, 2025

By

From the Fraser Institute

By Kenneth P. Green

The stiffer carbon tax will make Alberta’s oil sector more expensive and thus less competitive at a time when many analysts expect a surge in oil production. The costs of mandated carbon capture will similarly increase costs in the oilsands and make the province less cost competitive.

As we enter the final days of 2025, a “deal” has been struck between Carney government and the Alberta government over the province’s ability to produce and interprovincially transport its massive oil reserves (the world’s 4th-largest). The agreement is a step forward and likely a net positive for Alberta and its citizens. However, it’s not a second- or even third-best option, but rather a fourth-best option.

The agreement is deeply rooted in the development of a particular technology—the Pathways carbon capture, utilization and storage (CCUS) project, in exchange for relief from the counterproductive regulations and rules put in place by the Trudeau government. That relief, however, is attached to a requirement that Alberta commit to significant spending and support for Ottawa’s activist industrial policies. Also, on the critical issue of a new pipeline from Alberta to British Columbia’s coast, there are commitments but nothing approaching a guarantee.

Specifically, the agreement—or Memorandum of Understanding (MOU)—between the two parties gives Alberta exemptions from certain federal environmental laws and offers the prospect of a potential pathway to a new oil pipeline to the B.C. coast. The federal cap on greenhouse gas (GHG) emissions from the oil and gas sector will not be instituted; Alberta will be exempt from the federal “Clean Electricity Regulations”; a path to a million-barrel-per day pipeline to the BC coast for export to Asia will be facilitated and established as a priority of both governments, and the B.C. tanker ban may be adjusted to allow for limited oil transportation. Alberta’s energy sector will also likely gain some relief from the “greenwashing” speech controls emplaced by the Trudeau government.

In exchange, Alberta has agreed to implement a stricter (higher) industrial carbon-pricing regime; contribute to new infrastructure for electricity transmission to both B.C. and Saskatchewan; support through tax measures the building of a massive “sovereign” data centre; significantly increase collaboration and profit-sharing with Alberta’s Indigenous peoples; and support the massive multibillion-dollar Pathways project. Underpinning the entire MOU is an explicit agreement by Alberta with the federal government’s “net-zero 2050” GHG emissions agenda.

The MOU is probably good for Alberta and Canada’s oil industry. However, Alberta’s oil sector will be required to go to significantly greater—and much more expensive—lengths than it has in the past to meet the MOU’s conditions so Ottawa supports a west coast pipeline.

The stiffer carbon tax will make Alberta’s oil sector more expensive and thus less competitive at a time when many analysts expect a surge in oil production. The costs of mandated carbon capture will similarly increase costs in the oilsands and make the province less cost competitive. There’s additional complexity with respect to carbon capture since it’s very feasibility at the scale and time-frame stipulated in the MOU is questionable, as the historical experience with carbon capture, utilization and storage for storing GHG gases sustainably has not been promising.

These additional costs and requirements are why the agreement is the not the best possible solution. The ideal would have been for the federal government to genuinely review existing laws and regulations on a cost-benefit basis to help achieve its goal to become an “energy superpower.” If that had been done, the government would have eliminated a host of Trudeau-era regulations and laws, or at least massively overhauled them.

Instead, the Carney government, and now with the Alberta government, has chosen workarounds and special exemptions to the laws and regulations that still apply to everyone else.

Again, it’s very likely the MOU will benefit Alberta and the rest of the country economically. It’s no panacea, however, and will leave Alberta’s oil sector (and Alberta energy consumers) on the hook to pay more for the right to move its export products across Canada to reach other non-U.S. markets. It also forces Alberta to align itself with Ottawa’s activist industrial policy—picking winning and losing technologies in the oil-production marketplace, and cementing them in place for decades. A very mixed bag indeed.

Kenneth P. Green

Senior Fellow, Fraser Institute
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Alberta

West Coast Pipeline MOU: A good first step, but project dead on arrival without Eby’s assent

Published on November 27, 2025

By

The memorandum of understanding just signed by Prime Minister Mark Carney and Premier Danielle Smith shows that Ottawa is open to new pipelines, but these are unlikely to come to fruition without British Columbia Premier David Eby’s sign-off, warns the MEI.

“This marks a clear change to Ottawa’s long-standing hostility to pipelines, and is a significant step for Canadian energy,” says Gabriel Giguère, senior policy analyst at the MEI. “However, Premier Eby seems adamant that he’ll reject any such project, so unless he decides not to use his veto, a new pipeline will remain a pipedream.”

The memorandum of understanding paves the way for new pipeline projects to the West Coast of British Columbia. The agreement lays out the conditions under which such a pipeline could be deemed of national interest and thereby, under Bill C-5, circumvent the traditional federal assessment process.

Adjustments to the tanker ban will also be made in the event of such a project, but solely for the area around the pipeline.

The federal government has also agreed to replace the oil and gas emissions cap with a higher provincial industrial carbon tax, effective next spring.

Along with Premier Eby, several First Nations groups have repeatedly said they would reject any pipeline crossing through to the province’s coast.

Mr. Giguère points out that a broader issue remains unaddressed: investors continue to view Canada as a high-risk environment due to federal policies such as the Impact Assessment Act.

“Even if the regulatory conditions improve for one project, what is Ottawa doing about the long-term uncertainty that is plaguing future projects in most sectors?” asks the researcher. “This does not address the underlying reason Carney has to fast-track projects piecemeal in the first place.”

Last July, the MEI released a publication on how impact assessments should be fair, transparent, and swift for all projects, not just the few favoured by Ottawa under Bill C-5.

As of July, 20 projects were undergoing impact assessment review, with 12 in the second phase, five in the first phase, and three being assessed under BC’s substitution agreement. Not a single project is in the final stages of assessment.

In an Economic Note published this morning, the MEI highlights the importance of the North American energy market for Canada, with over $200 billion moving between Canada and the United States every year.

Total contributions to government coffers from the industry are substantial, with tens of billions of dollars collected in 2024-2025, including close to C$22 billion by Alberta alone.

“While it’s refreshing to see Ottawa and Alberta work collaboratively in supporting Canada’s energy sector, we need to be thinking long-term,” says Giguère. “Whether by political obstruction or regulatory drag, Canadians know that blocking investment in the oilpatch blocks investment in our shared prosperity.”

* * *

The MEI is an independent public policy think tank with offices in Montreal, Ottawa, and Calgary. Through its publications, media appearances, and advisory services to policymakers, the MEI stimulates public policy debate and reforms based on sound economics and entrepreneurship.

 

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