Energy efficiency ‘five times cheaper’ than new projects: report

A Hydro-Quebec power line in Beauharnois on Monday Nov. 10, 2025. (The Canadian Press/Christinne Muschi)

Energy efficiency measures are more affordable than adding new power generation projects, according to a report released Tuesday by the HEC Montréal chair in energy sector management.

Energy savings, which can be redirected to other purposes, cost an average of three cents per kilowatt-hour (¢/kWh), according to the study commissioned by the Quebec Council of Energy Efficiency Companies (CQ3E).

By comparison, generating additional electricity costs 12 ¢/kWh.

“It was roughly five times cheaper to pursue energy efficiency than to create new projects,” explained Chair Pierre-Olivier Pineau.

Energy efficiency also has the advantage of reducing the grid’s vulnerability, he adds, with less infrastructure to maintain.

It could also offer some benefits in the event of outages.

“Think of a very well-insulated house,” Pineau gives as an example. “In the event of a power outage, it will remain comfortable much longer in winter than a poorly insulated house.”

Hydro-Quebec has set a goal of achieving efficiency gains of 21 terawatt-hours (TWh) in its grid by 2035.

This “ambitious” goal is “technically very realistic,” but could prove difficult to sufficiently mobilize businesses and consumers, said Pineau.

“There’s a kind of widespread indifference linked to the historical abundance of low-cost energy, which means it’s not a priority for many people,” he notes.

“The simple fact that Hydro-Quebec has to advertise energy efficiency is a sign that there is a lack of concern at the grassroots level among consumers.”

He says there is significant potential for energy savings in the industrial sector and in commercial and institutional buildings.

The report indicates that 60 per cent of the industrial sector’s energy consumption is lost without being utilized.

“We could recycle this heat and feed it back into buildings, something that is rarely done,” said CQ3E Board Chair Michel Méthot, citing heat recovery for agri-food applications as an example.

One of the obstacles to energy efficiency in business is that the investment horizon is often too short to assess the profitability of projects, says Pineau.

“Since it isn’t necessarily profitable over five years, we let it slide,” he said.

Buildings, however, are assets with a lifespan much longer than five years, he argues.

A broad industry

The report also paints a picture of the ecosystem of companies involved in energy efficiency.

The industry comprises nearly 12,000 companies that are involved “directly or indirectly” in energy efficiency, Méthot explains.

“We’re still very fragmented: there are equipment manufacturers, there are consultants and there are specialized contractors,” he said.

The industry is estimated to generate $27 billion in revenue and employ nearly 100,000 people.

“We still have a very positive impact on the economy in general,” said Méthot. “We are also a source of energy supply.”

This report by The Canadian Press was first published in French on June 9, 2026.