June 6, 2005

Hydro-Quebec Sustainability Report 2004

Hydro-Québec is pleased to present its Sustainability Report 2004 under the theme "Moving Forward". This report reflects our determination to promote projects that are respectful of the environment while contributing to the economic and social development of Québec.

"We're very proud to reaffirm our commitment to sustainable development- a commitment that is fully in line with the social values of Quebecers," said Marie-José Nadeau, Executive Vice President, Corporate Affairs and Secretary General of Hydro-Québec. "By making energy choices that are profitable, responsible and sustainable, we're preserving the future of Québec communities."

Sustainable development in action

At Hydro-Québec, the principle of sustainability informs all our activities, from planning to operations and from R&D to construction. For example, during the planning of the Eastmain-1 hydropower project, we identified a series of measures to mitigate the negative impacts and improve spinoffs for the region. Spawning grounds, a weir and a fish pass will be installed on the Eastmain, and the river was seeded with more than 70,000 lake sturgeon fry. For the Toulnustouc project, 2,000 m2 of spawning grounds were set up for brook trout.

Contributing to regional economies

Because of the magnitude of our projects and operations, our presence has a stimulating effect on regional economies. In 2004, 15,000 direct jobs were created through our purchases of services. We recruit workers and suppliers locally, and in 2004 we purchased goods and services for a total of $2.394 billion, 94% of which went to QuÈbec-based companies. In 2004, the Fondation Hydro-QuÈbec pour l'environnement contributed over $900,000 to 16 environmental protection and enhancement projects in 10 regions of the province.

Taking action for society

In 2004, Hydro-Québec allocated $18 million in donations and sponsorships to more than 200 organizations active in science, culture, the environment, sustainable development or amateur sports. As a major contributor to training and education in QuÈbec, Hydro-Québec funded 15 university research chairs for a total of $1.65 million. For example, the University of Sherbrooke created the NSERC/Hydro-QuÈbec TransEnergie chair on overhead transmission lines. The Natural Sciences and Engineering Research Council of Canada and Hydro-Québec TransEnergie each contribute $1 million to this chair over a five-year period. The company also donated $3 million to the Fondation de l'Université du Québec à Trois-Rivières to support hydrogen research. Hydro-Québec signed some forty agreements, with municipalities, the agricultural sector and Aboriginal communities. Of particular importance was the signing of the Agreement Concerning a New Relationship between Hydro-Québec/SEBJ and the Crees of Eeyou Istchee. This agreement, built on mutual respect, good faith and reconciliation, puts an end to years of litigation between the Crees and Hydro-Québec.

Sustainable energy choices

In 2004, we continued working to develop energy projects that are profitable, respectful of local communities, and environmentally acceptable.

Hydropower as first choice: clean and renewable, this option makes it possible to preserve the planet's habitats and ecosystems. In a time of climate change, it remains the best option for the province as a whole and all its regions.

Diversification of supply sources: a giant step was taken toward the development of wind power in Québec.

Energy Efficiency Plan 2005-2010: an ambitious energy savings target of 3 TWh that was praised in all circles.

Better plant performance: minimizing the impact on water resources by improving energy output from our existing fleet. These accomplishments are a clear expression of our commitment to work for the sustainable energy development of Québec.

The Hydro-Québec Sustainability Report 2004 may be viewed on-line at www.hydroquebec.com/developpementdurable (an English version is now available).

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