hydro quebec

Hydro-Québec Records Surging Profits Amid Major Shift in Energy Trade Strategy

By CA News Staff | Published November 29, 2025

In a significant financial turnaround, Hydro-Québec has reported a massive surge in profitability for the third quarter of 2025, posting a net income increase of 61%. However, beneath the impressive balance sheet lies a dramatic shift in the province's energy landscape: for the first time in years, the utility is importing more electricity than it exports, a reversal driven by climate pressures and surging local demand.

This dual reality—record earnings alongside a changing energy flow—highlights the complex challenges facing one of Canada’s most iconic institutions as it navigates the transition to a green economy.

A Tale of Two Trends: Profits Soar While Trade Reverses

The headline numbers from Hydro-Québec’s latest financial report are undeniably strong. According to verified reports from Radio-Canada, the Crown corporation posted a net profit of $1.5 billion for the third quarter alone, a staggering 61% increase compared to the same period in 2024.

When looking at the cumulative performance for the first nine months of 2025, the picture remains bright. Le Journal de Montéal reported that profits reached $2.83 billion, marking a 30% year-over-year increase.

However, a parallel story is unfolding regarding the province's energy trade. A report from La Presse revealed a surprising metric: Hydro-Québec imported more electricity than it exported during the third quarter. This marks a significant departure from the utility's historical role as a net exporter of clean energy to the Northeast United States and Ontario.

Why the Sudden Shift?

The reversal in trade flow is not a failure of infrastructure, but rather a response to environmental and demand factors. Industry analysts point to two main drivers: 1. Low Water Reservoirs: Reduced precipitation and snowmelt in northern Quebec have lowered water levels in key reservoirs, limiting the capacity for maximum generation. 2. Surging Demand: A colder-than-average winter earlier in the year spiked consumption, while the province’s economy continues to demand more power for electrification and data centers.

This combination forced the utility to purchase power on the open market to ensure grid stability for Quebecers, even as it continued to fulfill export contracts.

Context: The "Empire of the St. Lawrence"

To understand the gravity of these headlines, one must look at Hydro-Québec's storied history. Born from the nationalization of private companies in 1944, the utility has long been a symbol of Quebec’s economic sovereignty and a cash cow for the provincial government.

Its massive hydroelectric projects, particularly the James Bay Project, established the province as a global leader in renewable energy. For decades, the model was simple: harness the power of the North, sell the surplus to neighbors, and return billions in dividends to the provincial treasury.

However, this model is facing stress tests. Climate change is altering precipitation patterns, making water management more volatile. Simultaneously, the global push for decarbonization is driving up local demand for electricity to power electric vehicles and heating systems.

The Customer Experience: Maintenance and Billing Changes

While the macro-economic numbers dominate the news cycle, the utility is also navigating operational changes that directly impact its 4.3 million customers.

Planned Outages: Residents of Montreal’s West Island recently faced a massive planned outage affecting over 60,000 customers. The utility announced this was necessary to replace aging equipment at the Des Sources substation in Dollard-des-Ormeaux. While disruptive, these maintenance projects are critical to preventing unplanned failures in the aging grid infrastructure.

Billing Adjustments: Hydro-Québec is also testing new revenue streams. Reports indicate the utility is seeking regulatory approval to charge customers for receiving paper bills. This move is part of a broader push toward digitalization and cost-cutting, though it has sparked debate regarding accessibility for elderly customers who may not have reliable internet access.

Immediate Economic Implications

The surge in profits and the shift in trade dynamics have immediate ripple effects for the Quebec economy.

1. Government Finances: As a Crown corporation, Hydro-Québec pays substantial dividends to the Quebec government. The 30% increase in profits for the first nine months of 2025 is a windfall for the provincial treasury, potentially easing budgetary pressures in other sectors like health and education.

2. Electricity Rates: Despite the profits, the fact that the utility had to import power—which is often more expensive than hydroelectric generation—raises questions about future rate hikes. While the cold winter of early 2025 drove revenue, the reliance on imports suggests that the era of "cheap power" may face upward pressure if water levels remain low.

3. The Green Economy: Hydro-Québec remains a linchpin in the global transition to clean energy. Its ability to export to the US Northeast is a key geopolitical asset. The current import trend is a temporary blip, but it underscores the fragility of the system. If Hydro-Québec cannot generate enough power locally, it may have to slow down plans to export green energy to help decarbonize other grids.

Future Outlook: Risks and Strategic Shifts

Looking ahead, Hydro-Québec faces a delicate balancing act.

The Export Dilemma: The utility has ambitious plans to increase exports to the United States, capitalizing on the American demand for carbon-free electricity. However, the recent import data could complicate negotiations. US partners may question Hydro-Québec's reliability if it is simultaneously buying power from neighbors like Ontario or New York.

Infrastructure Investment: The massive outage on the West Island highlights the urgent need for grid modernization. As the utility pivots to renewable intermittent sources like wind and solar (alongside its hydro base), the transmission grid must become smarter and more resilient. Expect Hydro-Québec to aggressively invest in battery storage and smart grid technologies in the coming years.

Climate Adaptation: The core of the business—water—is becoming less predictable. The "Empire of the St. Lawrence" must now adapt to an era of hydrological uncertainty. This may involve diversifying energy sources or investing heavily in water management technology to maximize every drop of water in the reservoirs.

Conclusion

Hydro-Québec’s financial results for 2025 demonstrate the enduring strength of its hydroelectric assets, delivering record profits that benefit the entire province. Yet, the simultaneous increase in power imports serves as a stark warning. It reveals that even a renewable energy giant is not immune to the whims of climate and rising demand.

For Quebecers, the coming years will likely bring a mix of high revenues—and potentially higher bills—alongside a renewed focus on energy conservation and grid reliability. Hydro-Québec remains a pillar of the economy, but it is clearly entering a new, more complex chapter.

Sources: Radio-Canada, Le Journal de Montréal, La Presse, and supplementary industry reports.