QFL asks Hydro Quebec to limit hikes

- The Quebec Federation of Labour has cautioned Hydro-Québec "not to throw the baby out with the bath water," when it asks to increase electricity bills in November.

Hydro-Québec has said it needs to boost the cost of retail electricity by as much as three per cent each year for the next five years.

The QFL, which represents 17,500 unionized Hydro-Québec employees, says it is not against a rate increase, but says the Charest government has to curb its appetite for unreasonable profit.

"Obviously we say yes to an increase - there hasn't been one in five years - but it has to be reasonable and allow us to maintain our competitive energy advantage," QFL president Henri Massé told a news conference recently.

"We say no to excessive profits that the government could then use to finance the tax reductions it has promised. That in the long term would rob Quebec of its enviable hydro-electric heritage that has been built up over the years."

When Hydro-Québec appears before the Régie de l'energie in the middle of November, and it is expected to ask the regulatory agency for permission to impose a three-per-cent rate hike before the end of this year and another three-per-cent increase in 2004.

Hydro's profits fell sharply in the first nine months of this year. It blames the decline in profits on a "significant reduction" in the volume of short-term electricity sales to external markets to meet increased demand in Quebec.

The president of the public utility, André Caillé, has said rate hikes of two to three per cent each year until 2008 are in order.

Charles Paradis, co-ordinator of Hydro-Québec's QFL employees, thinks that's too high, but he wouldn't spell out what a fair rate increase might be.

"We have confidence in the régie to determine the new tariff," he said.

"But it is necessary to show prudence and to put things in their proper perspective.

"We wouldn't want rates that endanger Quebec's independence when it comes to energy, or rates so high they would discourage investment in Quebec. Have we learned nothing from what has happened in Ontario?"

A consumer revolt over soaring hydro bills in Ontario is often cited as one of the reasons for the defeat of the Conservative government of Ernie Eves earlier this year.

Quebec and Manitoba have the lowest electricity rates in North America.