First, Hydro-Québec has indeed four divisions, including Hydro-Québec Distribution, which provides Quebecers with a reliable supply of electricity.
The rates are set in such a way as to allow Hydro-Québec Distribution to cover the expenses involved in providing electricity service to all of its Québec customers.
There are four major categories of expenses:
- Electricity purchases
- Power transmission
- Distribution system operation and maintenance
- Customer services
Only a small proportion (about 10%) of Hydro-Québec’s profits can be attributed to its electricity rates. Most of its earnings come from Hydro-Québec Production, which is in charge of exports.
There is no connection between the company’s annual profits and the rate application filed with the Régie de l’énergie.
Learn more about how rates are set: