Hydro-Québec rate hikes hit Bitfarms and crypto miners

Hydro-Quebec seeks to raise electricity rates for cryptocurrency mining projects to an average of 19.5 cents per kilowatt hour. This follows a Quebec Superior Court ruling where Justice Elif Oral struck down government decrees that supported higher rates for data centres and miners. The judge ruled the government overstepped by directly supporting Hydro-Quebec’s proposal, though she noted the concerns motivating the utility were not far-fetched.

The struggle for cheap power in Quebec

The province faces a massive influx of energy requests from the mining industry. More than 300 companies submitted applications totaling 15,000 megawatts, which exceeds one third of the total installed capacity in Quebec. Jonathan Cote of Hydro-Quebec stated that without rule changes, the utility would have had to connect all applicants because it has an obligation to serve those who make a request. He warned that this would force the utility to buy new capacity on the market, raising rates for all customers.

Bitfarms faces these shifting economics after securing 22 megawatts of hydroelectric capacity in Baie-Comeau. The company paid 1.8 million US dollars for this contract, paying 40 percent in cash and 60 percent in ordinary shares. Bitfarms expects to deploy 11 megawatts by the third quarter of 2023 and the remaining 11 megawatts in the second half of 2024. I find the sudden regulatory volatility in Quebec makes long-term planning for these specific assets difficult.

The utility also proposed a winter peak clause to limit electricity available to miners for 300 hours per year. This targets the few hundred hours of high demand during the coldest parts of the year. While residential users in Quebec pay around 7.065 cents per kilowatt hour for the first 40 kWh per day, new commercial mining sites using Rate CB pay 18.767 cents per kilowatt hour.

Profitability depends on hardware efficiency

Mining profitability in 2026 relies heavily on using recent-generation ASICs like the Antminer S21 or S23 series. An Antminer S23 Hydro breaks even at approximately 0.124 US dollars per kilowatt hour. Older machines like the S19 class require electricity prices below 0.055 US dollars per kilowatt hour to remain profitable.

Bitfarms is currently transitioning from Bitcoin mining to becoming a North American energy and digital infrastructure company. The company reported a third quarter 2025 GAAP loss of 0.08 US dollars per share. During that quarter, Bitfarms mined 520 Bitcoin, which was a decrease from the 718 Bitcoin mined in the second quarter. The company also plans to convert its Washington site for high-performance computing and AI workloads to support Nvidia’s Vera Rubin GPUs.

The cold climate in Quebec provides a natural advantage for cooling equipment. In January, average temperatures reach -15C, which helps reduce fan speeds and noise. For a miner using an Antminer S19j Pro, the heat produced can offset monthly heating costs by about 140.92 Canadian dollars during the seven months of the heating season. If you are running a small operation, you should check if your local municipality has noise bylaws regarding loud mining equipment.

Regulatory shifts and grid strain

The provincial government previously issued decrees to support rate increases, but the court blocked them. Hydro-Quebec continues to push for higher rates to protect other customers from the growing demand of the AI and crypto industries. Consultants hired by the utility expect demand from data centres to more than double between 2024 and 2030.

The scale of these operations creates significant baseload demand that runs 24 hours a day. Unlike electric vehicles that charge at night, mining occurs constantly, adding pressure during the winter peak. Will the regulator eventually approve the selection process that Hydro-Quebec proposed?

Bitfarms manages its portfolio across Canada, the United States, Argentina, and Paraguay. In Paraguay, HIVE Digital Technologies acquired Bitfarms’ Yguazu facility for 56 million US dollars in January 2026. This move occurred as the national utility in Paraguay warned that uncontrolled mining expansion could jeopardize power stability.