# EDGAR Filing Document

**Accession Number:** 0000049448
**File Stem:** 0001193125-25-137097
**Filing Date:** 2025-6
**Character Count:** 52485
**Document Hash:** e1524a1734b29deb25ddfbf73358fa65
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001193125-25-137097.hdr.sgml**: 20250606

**ACCESSION NUMBER**: 0001193125-25-137097

**CONFORMED SUBMISSION TYPE**: 18-K/A

**PUBLIC DOCUMENT COUNT**: 9

**CONFORMED PERIOD OF REPORT**: 20241231

**FILED AS OF DATE**: 20250606

**DATE AS OF CHANGE**: 20250606

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** HYDRO QUEBEC
- **CENTRAL INDEX KEY:** 0000049448
- **STANDARD INDUSTRIAL CLASSIFICATION:** ELECTRIC, GAS & SANITARY SERVICES [4900]
- **ORGANIZATION NAME:** 01 Energy & Transportation
- **EIN:** 000000000
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 18-K/A
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-07770
- **FILM NUMBER:** 251031114

**BUSINESS ADDRESS:**
- **STREET 1:** 75 RENE LEVESQUE BLVD W
- **STREET 2:** 5TH FLOOR
- **CITY:** MONTREAL CANADA
- **STATE:** A8
- **ZIP:** H2Z 1A4
- **BUSINESS PHONE:** 5142892210

**MAIL ADDRESS:**
- **STREET 1:** 75 RENE-LEVESQUE BLVD W.
- **STREET 2:** 5TH FLOOR
- **CITY:** MONTREAL CANADA
- **STATE:** A8
- **ZIP:** H2Z 1A4

**UNITED STATES** 

**SECURITIES AND EXCHANGE COMMISSION** 

**Washington, D.C. 20549** 

## FORM 18-K/A
**For Foreign Governments and Political Subdivisions Thereof** 

**AMENDMENT NO.1** 

**TO** 

**ANNUAL REPORT** 

**of** 

**HYDRO-QUÉBEC** 

**QUÉBEC, CANADA** 

**(Name of Registrant)** 

**Date of end of last fiscal year: December 31, 2024** 

**SECURITIES REGISTERED\*** 

**(As of the close of the fiscal year)** 

---

| | | |
|:---|:---|:---|
| Title of Issue | Amounts as to Which<br>Registration is Effective | Names of Exchanges<br>on Which Registered |
| &nbsp;&nbsp;&nbsp; N/A | N/A | N/A |

---

Name and address of persons authorized to receive notices

and communications from the Securities and Exchange Commission:

**David Brulotte** 

*Québec Government Office* 

One Rockefeller Plaza, Suite 2600

New York, NY 10020-2102

Copies to:

---

| | |
|:---|:---|
| **Catherine M. Clarkin**<br> Sullivan & Cromwell LLP<br> 125 Broad Street<br> New York, NY 10004-2498 | **Maxime Aucoin**<br> Executive Vice President and Chief Financial Officer<br> Hydro-Québec<br> 75 René-Lévesque Boulevard West<br> 22<sup>th</sup> Floor<br> Montréal, Québec, Canada H2Z 1A4 |

---

\* The Registrant is filing this annual report on a voluntary basis.

------

The undersigned registrant hereby amends its Annual Report on Form 18-K for the fiscal year ended December 31, 2024 ("Annual Report") as follows:

1. The following additional exhibits are hereby added to the Annual Report:

Exhibit 99.2: Quarterly Bulletin, First Quarter 2025

The Annual Report on Form 18-K and amendments on Form 18-K/A are filed on a voluntary basis.

Pursuant to the requirements of the *Securities Exchange Act* of 1934, the registrant has duly caused this Amendment No. 1 to be signed on its behalf by its authorized officer.

---

| | |
|:---|:---|
| **HYDRO-QUÉBEC** | **HYDRO-QUÉBEC** |
| By: | /s/ <u>Maxime Aucoin</u> |
|  | Maxime Aucoin<br> *Authorized Officer* |
| Name: | Maxime Aucoin |
| Title: | Executive Vice President and Chief Financial Officer |

---

Date: June 6, 2025

## Exhibit 99.2

**Exhibit 99.2** 

## Hydro-Québec

## Financial Results
**KEY FIGURES**![LOGO](g99247dsp3.jpg)

First Quarter of 2025 NET INCOME INVESTMENTS $2,056M $1,407M ELECTRICITY SALES IN QUÉBEC ELECTRICITY SALES OUTSIDE QUÉBEC 58.3 TWh 4.9 TWh $4,832M $798M

------

---

| | |
|:---|:---|
|  | **Management's Discussion and Analysis** |
| **Quarterly results at a glance** | In a context marked by favourable weather conditions across all markets, Hydro-Québec recorded **net income** of $2,056 million in the first quarter of 2025. This is an increase of $480 million compared to the $1,576 million recorded for the same period in 2024. |
|  | This net increase is mainly due to a $861-million rise in electricity sales. In Québec, colder temperatures in winter 2024-2025 compared to the previous year greatly contributed to the $509-million increase in related revenue mainly from additional sales of 4.1 TWh. On markets outside Québec, weather conditions experienced during the quarter led to a general rise in energy prices. Hydro-Québec took advantage of this situation by skillfully deploying its marketing strategy, which enabled it to maximize the contribution of its exports. As a result, sales outside Québec rose by $352 million compared to the first quarter of 2024. However, these favourable factors were partially offset by a $283-million increase in electricity purchases, mainly due to an increase in short-term purchases on the markets. It should also be noted that the low runoff conditions observed in 2023 and 2024 prompted the company to continue exercising sound management of its energy reserves. |
|  | ![LOGO](g99247dsp4.jpg) |
| **Consolidated results** | **Revenue** totalled $5,775 million, an increase of $902 million compared to the $4,873 million recorded in the first quarter of 2024. |
|  | In Québec, sales were $509 million higher than in the same period of the previous year when they had reached $4,323 million. Weather in winter 2024-2025 was colder than in the previous year, which translated into sales growth of 4.1 TWh or $370 million. As heating accounts for the vast majority of electricity consumption during the winter months, any drop in temperatures during this period has a favourable impact on the volume of electricity sales and related revenue. This impact was mostly felt during the months of January and February when temperatures were, on average, 3°C and 5°C lower, respectively, than those of 2024. The indexation of rates on April 1, 2024, also resulted in additional revenue of $157 million. |

---

------

---

| |
|:---|
| ![LOGO](g99247dsp5.jpg) |
| Revenue from electricity sales on external markets was $798 million, $352 million more than the $446 million posted for the same period in 2024. This increase is mainly due to favourable market conditions during the quarter. In fact, temperatures in the northeastern United States followed the same trend as in Québec and were colder than last year. This led to an increased demand for energy, which resulted in a sharp rise in market prices, particularly in New England— Hydro-Québec's main export market. Because of its marketing strategy, the company was able to seize interesting business opportunities during this period resulting in a significant increase in revenue from sales outside Québec, with a volume comparable to that of the same period the previous year. The volume reached 4.9 TWh, which nonetheless remains well below the first-quarter average for the ten years preceding the current period of low runoff. For the past two years, lower-than-normal water inflows have prompted Hydro-Québec to manage its large reservoirs prudently and dynamically. |

---

------

---

| | |
|:---|:---|
|  | ![LOGO](g99247dsp6.jpg) |
|  | **Total expenditure** amounted to $3,071 million in the first quarter of 2025, $382 million more than the $2,689 million recorded in the same period the previous year, essentially due to a $283-million increase in electricity purchases. On the one hand, short-term supplies purchased on the markets to meet Québec's ad hoc requirements during winter 2024–2025 increased by $113 million. Given the milder temperatures of the previous winter, these purchases had been much more limited in the previous year. On the other hand, higher prices on energy markets also resulted in a $93-million increase in purchases made for electricity export purposes. |
|  | **Financial expenses** totalled $648 million, $40 million more than the $608 million recorded in the previous year. This increase is mainly due to the impact of the new debt issues on the interest expense. |
| **Investments** | Investments in the first three months of 2025 totalled $1,407 million, compared to $1,113 million in the same period in 2024. These investments are mainly composed of investments in property, plant and equipment and intangible assets, as well as investments in the regulatory asset with respect to costs related to energy efficiency and demand response initiatives. This growth of more than 25% in investments reflects the company's determination to invest steadily not only in its generating, transmission and distribution facilities in order to offer reliable, high-quality service, but also in support for customers to help them make better use of energy, all while supporting Québec's economy. This commitment is in line with several of the *Action Plan 2035* priorities. These amounts are in addition to direct investments made by Hydro-Québec's external partners, particularly in wind power development, as well as to energy efficiency investments made by customers as part of the major energy ecosystem in which the company operates. |

---

------

---

| |
|:---|
| ![LOGO](g99247dsp7.jpg) |
| Investments in property, plant and equipment and intangible assets amounted to $1,230 million in the first quarter of 2025, compared to $1,065 million one year earlier. |
| Investments in asset sustainment amounted to $765 million. In particular, Hydro-Québec continued to invest in its generating facilities to ensure their long-term operability and maximize their output. Work is underway at Rapide-Blanc and Carillon generating stations in the Mauricie and Laurentides regions, respectively, and at the Bersimis-2 development in the Côte-Nord region. Regarding power transmission, the company continued the installation of two new converter units at Châteauguay substation in the Montérégie region, as well as modernizing equipment and systems, including the replacement of grid control systems, special protection systems and substation protections and controls, and pursued activities related to the architecture development plan for the 315-kV system on the island of Montréal. At the same time, it carried out work to optimize the operation of the distribution system and to maintain and improve the quality of its distribution assets. |
| Investments in development projects totalled $465 million. In particular, Hydro-Québec allocated significant funds to various projects to handle the growing customer base in Québec and increase output capacity. As an example, work is underway at Outardes-2 and René-Lévesque (formerly Manic-3) generating stations, in the Côte-Nord region, to increase their capacity. The construction of the Hertel–New York interconnection line, which will connect with the Champlain Hudson Power Express line to supply New York City with electricity, also continues, as does the deployment of a 320-kV direct-current line in the Chaudière-Appalaches and Estrie regions, as part of a larger project to build a new 1,200-MW interconnection between Québec and New England. |

---

------

---

| | |
|:---|:---|
|  | ![LOGO](g99247dsp8.jpg) |
| **Financing** | During the first quarter of 2025, Hydro-Québec carried out three fixed-rate issues on the Canadian capital market: an issue of medium-term notes maturing in 2032 for an amount of $0.8 billion, at a cost of 3.57%, and two bond issues maturing in 2065 for an amount of $0.9 billion, at an average cost of 4.34%. |
|  | The funds collected, a total of $1.7 billion, are being used to finance part of the investment program, among other things. |

---

------

**CONSOLIDATED FINANCIAL STATEMENTS** 

**(UNAUDITED)** 

**Consolidated Statements of Operations** 

---

| | | | |
|:---|:---|:---|:---|
|  In millions of Canadian dollars<br> (unaudited) | Three months ended<br>March 31 | Three months ended<br>March 31 | Three months ended<br>March 31 |
|  | Notes | **2025** | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2024 |
|  **Revenue** | 4 | **5775** | 4873 |
|  **Expenditure** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Operations |  | **1074** | 1011 |
| &nbsp;&nbsp;&nbsp;&nbsp; Other components of employee future benefit cost | 8 | **(229)** | (193) |
| &nbsp;&nbsp;&nbsp;&nbsp; Electricity purchases |  | **1093** | 810 |
| &nbsp;&nbsp;&nbsp;&nbsp; Depreciation and amortization |  | **757** | 724 |
| &nbsp;&nbsp;&nbsp;&nbsp; Taxes |  | **376** | 337 |
|  |  | **3071** | 2689 |
|  **Income before financial expenses** |  | **2704** | 2184 |
|  Financial expenses | 5 | **648** | 608 |
|  **Net income** |  | **2056** | 1576 |
| **Consolidated Statements of Comprehensive Income** | **Consolidated Statements of Comprehensive Income** | **Consolidated Statements of Comprehensive Income** |  |
|  In millions of Canadian dollars<br> (unaudited) | Three months ended<br> March 31 | Three months ended<br> March 31 | Three months ended<br> March 31 |
|  | Notes | **2025** | 2024 |
|  **Net income** |  | **2056** | 1576 |
|  **Other comprehensive income** | 9 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net change in items designated as cash flow hedges | 6 | **29** | (3) |
| &nbsp;&nbsp;&nbsp;&nbsp; Net change in translation differences |  | **(1)** | 52 |
| &nbsp;&nbsp;&nbsp;&nbsp; Net change in items designated as net investment hedges | 6 | **(2)** | (45) |
| &nbsp;&nbsp;&nbsp;&nbsp; Other |  | **17** | (18) |
|  |  | **43** | (14) |
|  **Comprehensive income** |  | **2099** | 1562 |

---

The accompanying notes are an integral part of the consolidated financial statements.

------

**Consolidated Balance Sheets** 

---

| | | | |
|:---|:---|:---|:---|
|  In millions of Canadian dollars<br> (unaudited) | Notes | **As at March 31,<br>2025** | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As at December 31,<br>2024 |
|  **ASSETS** |  |  |  |
|  **Current assets** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Cash and cash equivalents |  | **5477** | 3846 |
| &nbsp;&nbsp;&nbsp;&nbsp; Short-term investments |  | **1311** | 76 |
| &nbsp;&nbsp;&nbsp;&nbsp; Accounts receivable and other assets |  | **4931** | 3953 |
|  |  | **11719** | 7875 |
|  Property, plant and equipment and intangible assets |  | **80581** | 80055 |
|  Regulatory assets |  | **1372** | 1277 |
|  Employee future benefit assets |  | **7101** | 6888 |
|  Other assets |  | **3780** | 3614 |
|  |  | **104553** | 99709 |
|  <br> **LIABILITIES** |  |  |  |
|  **Current liabilities** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Borrowings |  | **3511** | 1 |
| &nbsp;&nbsp;&nbsp;&nbsp; Accounts payable and other liabilities |  | **3986** | 4423 |
| &nbsp;&nbsp;&nbsp;&nbsp; Dividend payable |  | **–** | 1997 |
| &nbsp;&nbsp;&nbsp;&nbsp; Current portion of long-term debt | 6 | **464** | 121 |
|  |  | **7961** | 6542 |
|  <br> Long-term debt | 6 | **61533** | 60238 |
|  <br> Employee future benefit liabilities |  | **1234** | 1230 |
|  <br> Other liabilities |  | **3019** | 2992 |
|  |  | **73747** | 71002 |
|  **EQUITY** |  |  |  |
|  Share capital |  | **4374** | 4374 |
|  Retained earnings |  | **25632** | 23576 |
|  Accumulated other comprehensive income | 9 | **800** | 757 |
|  |  | **30806** | 28707 |
|  |  | **104553** | 99709 |
|  Contingencies | 10 |  |  |

---

The accompanying notes are an integral part of the consolidated financial statements.

On behalf of the Board of Directors,

---

| | |
|:---|:---|
| **/s/ Geneviève Brouillette** | **/s/ Manon Brouillette** |
| Chair of the Audit Committee | Chair of the Board |

---

------

**Consolidated Statements of Changes in Equity** 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  In millions of Canadian dollars<br> (unaudited) | Three months ended<br> March 31 | Three months ended<br> March 31 | Three months ended<br> March 31 | Three months ended<br> March 31 | Three months ended<br> March 31 |
|  | Note | Share capital | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Retained<br>earnings | Accumulated<br>other<br> comprehensive<br>income | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total equity |
|  Balance as at December 31, 2024 |  | **4374** | **23576** | **757** | **28707** |
|  Net income |  |  | **2056** |  | **2056** |
|  Other comprehensive income | 9 |  |  | **43** | **43** |
|  Balance as at March 31, 2025 |  | **4374** | **25632** | **800** | **30806** |
|  Balance as at December 31, 2023 |  | 4374 | 22910 | 243 | 27527 |
|  Net income |  |  | 1576 |  | 1576 |
|  Other comprehensive income | 9 |  |  | (14) | (14) |
|  Balance as at March 31, 2024 |  | 4374 | 24486 | 229 | 29089 |

---

The accompanying notes are an integral part of the consolidated financial statements.

------

**Consolidated Statements of Cash Flows** 

---

| | | | |
|:---|:---|:---|:---|
|  In millions of Canadian dollars<br> (unaudited) | Three months ended<br> March 31 | Three months ended<br> March 31 | Three months ended<br> March 31 |
|  | Note | **2025** | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2024 |
|  **Operating activities** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net income |  | **2056** | 1576 |
| &nbsp;&nbsp;&nbsp;&nbsp; Adjustments to determine net cash flows from operating activities |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Depreciation and amortization |  | **757** | 724 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deficit of net cost recognized with respect to amounts paid for employee future benefits |  | **(146)** | (105) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other |  | **26** | 93 |
| &nbsp;&nbsp;&nbsp;&nbsp; Regulatory assets and liabilities |  | **(158)** | (39) |
| &nbsp;&nbsp;&nbsp;&nbsp; Change in non-cash working capital items | 7 | **(1494)** | (1208) |
|  |  | **1041** | 1041 |
|  **Investing activities** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Additions to property, plant and equipment and intangible assets |  | **(1230)** | (1065) |
| &nbsp;&nbsp;&nbsp;&nbsp; Acquisition of short-term investments |  | **(1564)** | (1195) |
| &nbsp;&nbsp;&nbsp;&nbsp; Acquisition of sinking fund securities |  | **(101)** |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Disposal of short-term investments |  | **335** | 912 |
| &nbsp;&nbsp;&nbsp;&nbsp; Other |  | **(3)** | (10) |
|  |  | **(2563)** | (1358) |
|  **Financing activities** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Issuance of long-term debt |  | **1736** | 1447 |
| &nbsp;&nbsp;&nbsp;&nbsp; Repayment of long-term debt |  | **(117)** | (49) |
| &nbsp;&nbsp;&nbsp;&nbsp; Cash receipts arising from credit risk management |  | **657** | 831 |
| &nbsp;&nbsp;&nbsp;&nbsp; Cash payments arising from credit risk management |  | **(634)** | (555) |
| &nbsp;&nbsp;&nbsp;&nbsp; Net change in borrowings |  | **3493** | 3962 |
| &nbsp;&nbsp;&nbsp;&nbsp; Dividend paid |  | **(1997)** | (2466) |
| &nbsp;&nbsp;&nbsp;&nbsp; Other |  | **19** | 2 |
|  |  | **3157** | 3172 |
|  **Foreign currency effect on cash and cash equivalents** |  | **(4)** | 16 |
|  **Net change in cash and cash equivalents** |  | **1631** | 2871 |
|  **Cash and cash equivalents, beginning of period** |  | **3846** | 2111 |
|  **Cash and cash equivalents, end of period** |  | **5477** | 4982 |
|  Supplementary cash flow information | 7 |  |  |

---

The accompanying notes are an integral part of the consolidated financial statements.

------

**NOTES TO CONSOLIDATED FINANCIAL STATEMENTS** 

**(UNAUDITED)** 

For the three-month periods ended March 31, 2025 and 2024

Amounts in tables are in millions of Canadian dollars, unless otherwise indicated.

---

| | |
|:---|:---|
| **Note 1** | **Basis of Presentation**  |

---

Hydro-Québec's consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles.

These quarterly consolidated financial statements, including these notes, do not contain all the required information regarding annual consolidated financial statements and should therefore be read in conjunction with the consolidated financial statements and accompanying notes in Hydro-Québec's *Annual Report 2024*.

The accounting policies used to prepare the quarterly consolidated financial statements are consistent with those presented in Hydro-Québec's *Annual Report 2024*.

Hydro-Québec's quarterly results are not necessarily indicative of results for the year on account of seasonal temperature fluctuations. Because of higher electricity demand during winter months, revenue from electricity sales in Québec is higher during the first and fourth quarters.

Management has reviewed events occurring until June 6, 2025, the date of approval of these quarterly consolidated financial statements by the Board of Directors, to determine whether circumstances warranted consideration of events subsequent to the balance sheet date.

---

| | |
|:---|:---|
| **Note 2** | **Change in Accounting Policy**  |

---

**Segmented information** 

On January 1, 2024, Hydro-Québec adopted, using a retrospective approach, Accounting Standards Update ("ASU") 2023-07, *Segment Reporting (Topic 280)—Improvements to Reportable Segment Disclosures*, issued by the Financial Accounting Standards Board for annual periods beginning on or after that date, and for interim periods beginning on or after January 1, 2025.

This ASU requires the disclosure of additional segmented information, including the title and position of the individual or the name of the group identified as the chief operating decision maker as well as the significant expenses regularly provided for the purposes of evaluating the performance of the operating segment or segments of the entity. The required quarterly information is disclosed in Note 11, Information on the Operating Segment.

---

| | |
|:---|:---|
| **Note 3** | **Regulation**  |

---

**Distribution activities** 

As of April 1, 2025, electricity rates for residential customers subject to domestic rates increased by 3%, as established by the government of Québec under Order in Council 464-2025 dated March 26, 2025. The Régie de l'énergie of Québec (the "Régie") authorized rate increases of 3.6% for commercial customers and

1.7% for customers subject to Rate L, in accordance with decisions D-2025-022 dated February 22, 2025, and D-2025-033 dated March 6, 2025. In decisions D-2025-044 and D-2025-045 dated March 31, 2025, the Régie stated that decisions D-2025-022 and D-2025-033 were provisional rulings.

---

| | |
|:---|:---|
| **Note 4** | **Revenue**  |

---

---

| | | |
|:---|:---|:---|
| | **Three months ended<br>March 31** | **Three months ended<br>March 31** |
| | **2025** | 2024 |
|  **Revenue from ordinary activities** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Electricity sales |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; In Québec | **4832** | 4323 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Outside Québec | **798** | 446 |
|  | **5630** | 4769 |
| &nbsp;&nbsp;&nbsp;&nbsp; Other revenue from ordinary activities | **74** | 72 |
|  | **5704** <sup>a</sup> | 4841 <sup>a</sup> |
|  Revenue from other activities | **71** | 32 |
|  | **5775** | 4873 |

---

a) Including gains and losses on derivative instruments whose amounts are presented in Note 6, Financial Instruments.

------

---

| | |
|:---|:---|
| **Note 5** | **Financial Expenses**  |

---

            <u> Three months ended<br>March 31</u>

---

| | | |
|:---|:---|:---|
| | **2025** | **2024**<sup>a</sup> |
|  Net interest on long-term debt<sup>b</sup> | **670** | 632 |
|  Capitalized financial expenses | **(58)** | (49) |
|  Net investment income<sup>c</sup> | **(39)** | (39) |
|  Other<sup>d</sup> | **75** | 64 |
|  | **648** | 608 |

---

a) Prior-period data have been reclassified to conform to the presentation adopted in the current period.

b) Including investment income of $10 million ($5 million in 2024) from securities held in the sinking funds
allocated to repaying the long-term debt. The voluntary sinking fund strategy aims to issue additional bonds and to invest the funds raised in securities issued by certain provincial governments in Canada, so as to ensure the availability of funds
when these debts mature in 2035.

c) Including interest of $16 million ($54 million in 2024) on short-term borrowings and cash received as
collateral. Hydro *-* Québec has access to a commercial paper program whose limit is US$5 billion or equivalent in C$. As part of its liquidity risk management, Hydro *-* Québec maintains an annual average outstanding amount of commercial paper ranging from US$2 billion to US$4 billion and can invest the funds raised in short-term investments and cash
equivalents.

d) Including guarantee fees of $70 million ($65 million in 2024) paid to the Québec government related to
debt securities, which are charged at a rate of 0.5%.

---

| | |
|:---|:---|
| **Note 6** | **Financial Instruments**  |

---

In the course of its operations, Hydro-Québec carries out transactions that expose it to certain financial risks, such as market and credit risk. Exposure to such risks and the impact on results are reduced through careful monitoring and implementation of strategies that include the use of derivative instruments.

**Market risk** 

Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate as a result of changes in market prices.

**Currency risk** 

Hydro-Québec uses currency swaps and forward currency purchase contracts to manage the currency risk associated with U.S. dollar denominated short-term borrowings and long-term debt and forward currency sales contracts to manage exposure associated with probable sales in U.S. dollars. When designated as hedging items, these derivative instruments are recognized as cash flow hedges.

Hydro-Québec also uses forward currency sales contracts to cover its net investment in a foreign operation whose functional currency is the U.S. dollar. When designated as hedging items, these derivative instruments are recognized as net investment hedges.

**Interest rate risk** 

Hydro-Québec uses interest rate swaps to convert certain fixed-rate debts into variable-rate debts and interest rate forward contracts to set the interest rate for certain future debt issues. When designated as hedging items, these derivative instruments are recognized based on the type of hedge: cash flow hedge or fair value hedge.

**Price risk** 

Hydro-Québec uses mainly commodity futures and swaps to manage risk resulting from fluctuations in energy, aluminum and diesel prices. This aims to mitigate the impact of market price volatility on the results on the sale and purchase of electricity and purchase of fuel indexed to these prices. When designated as hedging items, these derivative instruments are recognized as cash flow hedges.

The following table presents the notional amounts of forward contracts and swaps used to manage the main types of market risk:

---

| | | |
|:---|:---|:---|
| | **As at<br>March 31,<br>2025** | As at<br>December 31,<br>2024 |
|  **Currency risk** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Sale (US$ million) | **2517** | 2733 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Purchase (US$ million) | **5365** | 2964 |
|  **Interest rate risk** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Variable-rate payer<br>(C$ million) | **1500** | 1500 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Fixed-rate payer<br>(C$ million) | **2600** | 2000 |
|  **Price risk** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Electricity – Sale (TWh) | **3.8** | 5.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Electricity – Purchase (TWh) | **1.0** | 0.4 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Aluminum (tonnes) | **282500** | 300000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Diesel (millions of litres) | **15.2** | 15.2 |

---

------

---

| | |
|:---|:---|
| **Note 6** | **Financial Instruments (continued)**  |

---

**Credit risk** 

Credit risk is the risk that one party to a financial asset will fail to meet its obligations.

Hydro-Québec is exposed to credit risk related to accounts receivable and other financial assets such as cash and cash equivalents, short-term investments, the sinking funds, deposits and derivative instruments.

In terms of accounts receivable, this risk arises primarily from ongoing electricity sales inside and outside Québec. The risk exposure is limited due to Hydro-Québec's large and diverse customer base in addition to measures put in place such as security deposits, scheduled prepayments, payment arrangements and service interruptions. Management therefore believes that Hydro-Québec is not exposed to a high credit risk, particularly because sales in Québec are billed at rates that allow for recovery of costs based on the terms and conditions set by the Régie de l'énergie of Québec.

As at March 31, 2025, Accounts receivable and other assets included an amount of $2,738 million ($2,231 million as at December 31, 2024) from contracts concluded with customers, including $1,400 million ($1,592 million as at December 31, 2024) in unbilled electricity deliveries. Accounts receivable and other assets are presented net of the allowance for credit losses of $410 million ($386 million as at December 31, 2024).

In order to reduce the exposure to credit risk related to other financial assets, Hydro-Québec deals with a number of issuers and financial institutions with high credit ratings. Furthermore, to offset exposure to risk related to derivative instruments, it has signed, with each counterparty, a collateral exchange agreement based on the International Swaps and Derivatives Association ("ISDA") guidelines, which limits the market value of the portfolio. A variation of this market value beyond the agreed-upon limit will therefore result in a cash receipt or payment.

**Fair value** 

***Fair value of derivative instruments***

The following tables present the fair value of derivative instruments, including the impact of offsets, by hedge type:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **As at March 31, 2025** | **As at March 31, 2025** | **As at March 31, 2025** | **As at March 31, 2025** | **As at March 31, 2025** |
| | Fair value<br>hedges | Cash flow<br>hedges | Net<br>investment<br>hedges | Derivatives<br>not<br>designated<br>as hedges | Total |
|  **Assets** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Currency contracts |  | 616 |  | 33 | **649** |
| &nbsp;&nbsp;&nbsp;&nbsp; Interest rate contracts | 154 | 44 |  |  | **198** |
| &nbsp;&nbsp;&nbsp;&nbsp; Price contracts | – | 46 | – | 36 | **82** |
|  Gross amounts recognized | 154 | 706 |  | 69 | **929** |
|  Less |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Impact of gross amounts offset<sup>a</sup> |  |  |  |  | **128** |
| &nbsp;&nbsp;&nbsp;&nbsp; Impact of cash received as collateral<sup>b</sup> |  |  |  |  | **723** |
|  **Net assets** |  |  |  |  | **78** <sup>c</sup> |
|  **Liabilities** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Currency contracts |  | 17 | 125 | 8 | **150** |
| &nbsp;&nbsp;&nbsp;&nbsp; Interest rate contracts |  | 77 |  |  | **77** |
| &nbsp;&nbsp;&nbsp;&nbsp; Price contracts | – | 6 | – | 49 | **55** |
|  Gross amounts recognized |  | 100 | 125 | 57 | **282** |
|  Less |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Impact of gross amounts offset<sup>a</sup> |  |  |  |  | **128** |
| &nbsp;&nbsp;&nbsp;&nbsp; Impact of cash paid as collateral<sup>b</sup> |  |  |  |  | **64** |
|  **Net liabilities** |  |  |  |  | **90** <sup>d</sup> |

---

------

---

| | |
|:---|:---|
| **Note 6** | **Financial Instruments (continued)**  |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | | | As at December 31, 2024 | As at December 31, 2024 | As at December 31, 2024 |
| | Fair value<br>hedges | Cash flow<br>hedges | Net<br>investment<br>hedges | Derivatives<br>not<br>designated<br> as hedges | Total |
|  **Assets** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Currency contracts |  | 601 |  | 36 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;637 |
| &nbsp;&nbsp;&nbsp;&nbsp; Interest rate contracts | 129 | 18 |  |  | 147 |
| &nbsp;&nbsp;&nbsp;&nbsp; Price contracts | – | 41 | – | 33 | 74 |
|  Gross amounts recognized | 129 | 660 |  | 69 | 858 |
|  Less |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Impact of gross amounts offset<sup>a</sup> |  |  |  |  | 92 |
| &nbsp;&nbsp;&nbsp;&nbsp; Impact of cash received as collateral<sup>b</sup> |  |  |  |  | 719 |
|  **Net assets** |  |  |  |  | 47 <sup>c</sup> |
|  **Liabilities** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Currency contracts |  | 41 | 124 | 4 | 169 |
| &nbsp;&nbsp;&nbsp;&nbsp; Interest rate contracts |  | 1 |  |  | 1 |
| &nbsp;&nbsp;&nbsp;&nbsp; Price contracts | – | 16 | – | 45 | 61 |
|  Gross amounts recognized |  | 58 | 124 | 49 | 231 |
|  Less |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Impact of gross amounts offset<sup>a</sup> |  |  |  |  | 92 |
| &nbsp;&nbsp;&nbsp;&nbsp; Impact of cash paid as collateral<sup>b</sup> |  |  |  |  | 74 |
|  **Net liabilities** |  |  |  |  | 65 <sup>d</sup> |

---

a) The impact of gross amounts offset is related to contracts traded according to ISDA guidelines and constituting
enforceable master netting arrangements. Such master netting arrangements apply to all derivative instrument contracts traded over the counter.

b) Cash amounts offset are amounts received or paid under collateral exchange agreements signed in compliance with ISDA
guidelines.

c) As at March 31, 2025, $49 million was recorded in Accounts receivable and other assets ($39 million as at
December 31, 2024) and $29 million in Other assets ($8 million as at December 31, 2024).

d) As at March 31, 2025, $60 million was recorded in Accounts payable and other liabilities ($62 million as at
December 31, 2024) and $30 million in Other liabilities ($3 million as at December 31, 2024).

Moreover, although certain derivative instruments cannot be offset for lack of enforceable master netting arrangements, margin calls may result in amounts received from or paid to clearing agents, based on the fair value of the instruments concerned. Hydro-Québec may also transfer Treasury bills to a clearing agent as financial collateral. As at March 31, 2025, an amount of $11 million receivable in consideration of net payments ($30 million as at December 31, 2024) and an amount of

$51 million receivable in consideration of the transfer of Treasury bills ($76 million as at December 31, 2024) were included in Accounts receivable and other assets, whereas an amount of $7 million payable in consideration of net cash receipts was included in Accounts payable and other liabilities (nil as at December 31, 2024). When the Treasury bills mature, the clearing agent remits the proceeds, including interest, to Hydro-Québec.

***Fair value hierarchy***

Fair value measurements of derivative instruments are classified according to a three-level hierarchy, based on the inputs used.

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | **As at March 31, 2025** | **As at March 31, 2025** | **As at March 31, 2025** | **As at March 31, 2025** | As at December 31, 2024 | As at December 31, 2024 | As at December 31, 2024 | As at December 31, 2024 |
| | Level 1<sup>a</sup> | Level 2<sup>b</sup> | Level 3<sup>c</sup> | Total | Level 1<sup>a</sup> | Level 2<sup>b</sup> | Level 3<sup>c</sup> | Total |
|  **Assets** | 32 | 888 | 9 | **929** | 21 | 820 | 17 | 858 |
|  **Liabilities** | 53 | 229 | – | **282** | 61 | 170 | – | 231 |
|  |  |  |  | **647** |  |  |  | 627 |

---

a) Fair values are derived from the closing price on the balance sheet date.

b) Fair values are obtained by discounting future cash flows, which are estimated on the basis of the spot rates, forward
rates or forward prices (foreign exchange rates, interest rates, and energy, aluminum or diesel prices) in effect on the balance sheet date, and take into account the credit risk assessment. The valuation techniques make use of observable market
inputs.

c) Fair values are not based on observable inputs. The valuation technique used to classify fixed price power purchase
agreements of variable volumes is based on forward energy prices, taking the counterparty's historical consumption into consideration.

------

---

| | |
|:---|:---|
| **Note 6** | **Financial Instruments (continued)**  |

---

***Impact of derivative instruments on results and Other comprehensive income***

The instruments traded, the impact of which is presented in the table below, reduce the volatility of results. Most of the derivative instruments are designated as hedges.

---

| | | |
|:---|:---|:---|
| | Three months ended<br> March 31 | Three months ended<br> March 31 |
| | **2025** | 2024 |
|  **Gains (losses) on derivatives recognized in results** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Fair value hedges |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest rate contracts<sup>a</sup> | **22** | (50) |
| &nbsp;&nbsp;&nbsp;&nbsp; Derivatives not designated as hedges |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Currency contracts<sup>b</sup> | **9** | 39 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Price contracts<sup>b</sup> | **(9)** | 11 |
|  | **22**<sup>c</sup> | –<sup>c</sup> |
| **(Losses) gains on derivatives reclassified from Other comprehensive income to results** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Cash flow hedges |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Currency contracts<sup>d</sup> | **(10)** | 101 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest rate contracts<sup>a</sup> | **–** |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Price contracts<sup>e</sup> | **(38)** | 219 |
|  | **(48)**<sup>c</sup> | 320<sup>c</sup> |
| **(Losses) gains on derivatives recognized in Other comprehensive income** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Cash flow hedges |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Currency contracts | **19** | 65 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest rate contracts | **(11)** | 173 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Price contracts | **(27)** | 79 |
|  | **(19)** | 317 |
| &nbsp;&nbsp;&nbsp;&nbsp; Net investment hedges |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Currency contracts | **(2)** | (45) |
|  | **(21)** | 272 |

---

a) These amounts were recognized in Financial expenses.

b) These derivative instruments are essentially traded as part of integrated risk management. Their impact on results is
recognized in the line items affected by the managed risk. Therefore, in 2025, $(9) million was recognized in Revenue ($12 million in 2024), $(1) million in Electricity purchases [$(1) million in 2024], and $10 million in Financial
expenses ($39 million in 2024).

c) In 2025, the items Revenue, Electricity purchases, and Financial expenses totalled, respectively, $5,775 million,
$1,093 million and $648 million ($4,873 million, $810 million and $608 million in 2024).

d) In 2025, $(9) million was recognized in Revenue [$(15) million in 2024], and $(1) million in Financial expenses
($116 million in 2024).

e) In 2025, $(38) million was recognized in Revenue ($215 million in 2024), and no amount was recognized in
Electricity purchases ($4 million in 2024).

For the three-month periods ended March 31, 2025 and 2024, Hydro-Québec did not reclassify any amount from Accumulated other comprehensive income to results after having discontinued cash flow hedges.

As at March 31, 2025, Hydro-Québec estimated that the total gains and losses on derivative instruments in Accumulated other comprehensive

income that would be reclassified to results in the next 12 months amounted to a net gain of $14 million ($146 million as at March 31, 2024).

As at March 31, 2025, the maximum period during which Hydro-Québec hedged its exposure to the variability of cash flows related to anticipated transactions was five years (six years as at March 31, 2024).

------

---

| | |
|:---|:---|
| **Note 6** | **Financial Instruments (continued)**  |

---

***Fair value of other financial instruments***

Fair value measurements for other financial instruments are Level 2 measurements. Fair value is obtained by discounting future cash flows, based on rates observed on the balance sheet date for similar instruments traded on financial markets.

The fair value of cash equivalents, accounts receivable, deposits, other financial assets and financial liabilities approximates their carrying amount because of the short-term nature of these financial instruments, except for the items presented in the table below:

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **As at March 31, 2025** | **As at March 31, 2025** | As at December 31, 2024 | As at December 31, 2024 |
| | Carrying amount | Fair value | Carrying amount | Fair value |
|  **Assets** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Sinking funds<sup>a</sup> | **1305** | **1323** | 1202 | 1201 |
|  **Liabilities** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Long-term debt<sup>b</sup> | **61997** <sup>c</sup> | **62719** | 60359 <sup>c</sup> | 61483 |

---

a) The sinking funds allocated to repaying the long-term debt consist of securities issued by certain provincial governments
in Canada.

b) Includes the current portion.

c) Includes an amount of $1,485 million as at March 31, 2025 ($1,486 million as at December 31, 2024),
for debts subject to a fair value hedge, which resulted in an adjustment of $146 million ($125 million as at December 31, 2024) with respect to existing hedging relationships and of $(49) million [$(51) million as at December 31,
2024] for hedging relationships terminated by Hydro-Québec.

---

| | |
|:---|:---|
| **Note 7** | **Supplementary Cash Flow Information**  |

---

---

| | | |
|:---|:---|:---|
| Three months ended<br> March 31 | Three months ended<br> March 31 | Three months ended<br> March 31 |
|  | **2025** | 2024 |
|  **Change in non-cash working capital items** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Accounts receivable and other assets | **(1046)** | (833) |
| &nbsp;&nbsp;&nbsp;&nbsp; Accounts payable and other liabilities | **(448)** | (375) |
|  | **(1494)** | (1208) |
|  **Activities not affecting cash** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Increase in property, plant and equipment and intangible assets | **31** | 24 |
| &nbsp;&nbsp;&nbsp;&nbsp; Increase in operating lease assets and liabilities | **10** | 1 |
|  | **41** | 25 |
|  **Interest paid** | **1086** | 1032 |

---

------

---

| | |
|:---|:---|
| **Note 8** | **Employee Future Benefits**  |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | Three months ended<br> March 31 | Three months ended<br> March 31 | Three months ended<br> March 31 | Three months ended<br> March 31 | Three months ended<br> March 31 | Three months ended<br> March 31 |
| | Pension Plan | Pension Plan | Other plans | Other plans | Total | Total |
| | **2025** | 2024 | **2025** | 2024 | **2025** | 2024 |
|  Current service cost | **93** | 98 | **13** | 12 | **106** | 110 |
|  Other components of employee future benefit cost |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Interest on obligations | **278** | 290 | **15** | 16 | **293** | 306 |
| &nbsp;&nbsp;&nbsp;&nbsp; Expected return on plan assets | **(522)** | (499) | **–** | – | **(522)** | (499) |
|  | **(244)** | (209) | **15** | 16 | **(229)** | (193) |
|  **Net (credit) cost recognized** | **(151)** | (111) | **28** | 28 | **(123)** | (83) |

---

---

| | |
|:---|:---|
| **Note 9** | **Accumulated Other Comprehensive Income**  |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | | | | | **Three months ended**<br> **March 31, 2025** | **Three months ended**<br> **March 31, 2025** |
| | Cash flow<br> hedges | Translation<br>differences | Net<br>investment<br>hedges | Employee<br> future<br> benefits | Other | Accumulated<br>other<br>comprehensive<br>income |
|  Balance as at December 31, 2024 | 471 | 184 | (137) | 210 | 29 | **757** |
|  Other comprehensive income before reclassifications | (19) | (1) | (2) | 1 | 16 | **(5)** |
|  Less |  |  |  |  |  |  |
|  Losses reclassified outside of Accumulated other comprehensive income | (48) | – | – | – | – | **(48)** |
|  Other comprehensive income | 29 | (1) | (2) | 1 | 16 | **43** |
|  Balance as at March 31, 2025 | 500 | 183 | (139) | 211 | 45 | **800** |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | | | | | Three months ended<br> March 31, 2024 | Three months ended<br> March 31, 2024 |
| | Cash flow<br> hedges | Translation<br>differences | Net<br>investment<br>hedges | Employee<br> future<br> benefits | Other | Accumulated<br>other<br>comprehensive<br>income |
|  Balance as at December 31, 2023 | 656 | (1) | 26 | (485) | 47 | 243 |
|  Other comprehensive income before reclassifications | 317 | 52 | (45) |  | (18) | 306 |
|  Less |  |  |  |  |  |  |
|  Gains reclassified outside of Accumulated other comprehensive income | 320 | – | – | – | – | 320 |
|  Other comprehensive income | (3) | 52 | (45) | – | (18) | (14) |
|  Balance as at March 31, 2024 | 653 | 51 | (19) | (485) | 29 | 229 |

---

------

---

| | |
|:---|:---|
| **Note 10** | **Contingencies**  |

---

**Litigation** 

In the normal course of its development and operations, Hydro-Québec is involved in claims and legal proceedings from time to time. Management believes that adequate provision has been made for such litigation. Consequently, it does not expect any material adverse effect of such contingent liabilities on the financial position or consolidated results of Hydro-Québec.

Among other pending actions, certain First Nations and Inuit communities have instituted proceedings before the Québec courts against the governments of Canada and Québec and against Hydro-Québec based on claims of Aboriginal rights and titles. For example, the Innu of Uashat mak Mani-utenam are claiming $1.5 billion as compensation for various activities carried out on the territory they claim, including the generation and transmission of electricity. In addition, the Innu of Pessamit have brought an action seeking the recognition of their Aboriginal rights and title to lands in Québec where certain Hydro-Québec electricity generation and transmission facilities are located, including the Manic-Outardes and Bersimis hydroelectric complexes. They allege that these facilities infringe on their Aboriginal rights and title and are claiming $500 million in compensation. Hydro-Québec is contesting the merits of these claims.

In addition, proceedings have been instituted against Hydro-Québec and Churchill Falls (Labrador) Corporation Limited ["CF(L)Co"] relative to the Churchill Falls hydroelectric complex in Labrador, which is owned and operated by CF(L)Co. In an action brought before the courts of Newfoundland and Labrador in October 2020, Innu Nation Inc. alleges that the construction and operation of this hydroelectric complex amount to a "common enterprise" of CF(L)Co and Hydro-Québec, and allegedly infringe on the Aboriginal rights and title of the Labrador Innu. Innu Nation Inc. seeks a disgorgement of the profits that CF(L)Co and Hydro-Québec

have derived from the operation of this hydroelectric complex or, failing that, monetary compensation of $4 billion with regard to Hydro-Québec. In another action brought in 2023 before the Québec Superior Court, the Innu of Uashat mak Mani-utenam and the Innu of Matimekush-Lac John allege that the Churchill Falls complex infringes on their Aboriginal rights and title, as well as their treaty rights. In addition to various judicial declarations and permanent injunction orders, these two communities are jointly claiming from Hydro-Québec $2 billion in compensatory damages, $200 million in punitive damages, and additional damages in the form of an annual payment equivalent to 12.5% of 15% of Hydro-Québec's annual profits from the date of the commencement of the proceedings. Hydro-Québec is contesting the merits of these claims.

**Investments** 

On February 24, 2025, Innergex énergie renouvelable inc. ("Innergex") and the Caisse de dépôt et placement du Québec ("CDPQ") entered into an agreement for CDPQ to acquire all issued and outstanding common shares of Innergex at a price of $13.75 per share, including Hydro-Québec's 19.9% stake. The transaction is set to close by December 31, 2025, subject to regulatory approvals and other usual closing conditions.

Management believes that the disposal of this investment should result in a gain. The amount of the gain will depend on the change in the investment's carrying value, which is accounted for using the equity method up to the transaction's closing. As at March 31, 2025, the carrying amount was $352 million. In 2023, Hydro-Québec proceeded to a comparison of the carrying value of the investment with its fair value as at December 31 and recognized an adjustment of $284 million in its share of the results.

---

| | |
|:---|:---|
| **Note 11** | **Information on the Operating Segment**  |

---

Hydro*-*Québec has only one operating segment. It manages its activities using a cross-functional approach. Its results and total assets are analyzed on a consolidated basis by the chief operating decision maker. Significant expenses that are submitted to the chief operating decision maker for this purpose on a regular basis over the course of the period are disclosed in the following table. Investments are also submitted.

---

| | | | |
|:---|:---|:---|:---|
| | | Three months ended<br> March 31 | Three months ended<br> March 31 |
| | Notes | **2025** | 2024 |
|  **Revenue** | 4 | **5775** | 4873 |
|  **Expenditure** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Current operations<sup>a</sup> |  | **966** | 904 |
| &nbsp;&nbsp;&nbsp;&nbsp; Electricity purchases |  | **1093** | 810 |
| &nbsp;&nbsp;&nbsp;&nbsp; Depreciation and amortization |  | **757** | 724 |
| &nbsp;&nbsp;&nbsp;&nbsp; Other<sup>b</sup> |  | **255** | 251 |
|  **Financial expenses** | 5 | **648** | 608 |
|  **Net income** |  | **2056** | 1576 |
|  **Investments**<sup>c</sup> |  | **1407** | 1113 |
|  **Equity method investments on March 31** |  | **1736** | 1689 |

---

a) Current operational expenditure is mainly composed of payroll, the cost of external services, acquisition costs of
tangible and intangible property, and operating lease expenses.

b) The other expenditure is mainly composed of taxes, other components of employee future benefit cost and current service
cost of the Pension Plan.

c) Investments are mainly composed of investments in property, plant and equipment and intangible assets, as well as
investments in the regulatory asset with respect to costs related to energy efficiency and demand response initiatives.

------

**CONSOLIDATED FINANCIAL HIGHLIGHTS** 

**(UNAUDITED)** 

Amounts shown in tables are in millions of Canadian dollars.

---

| | | | |
|:---|:---|:---|:---|
| | Three months ended<br> March 31 | Three months ended<br> March 31 | Three months ended<br> March 31 |
|  **Summary of Results** | **2025** | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2024 | Change (%) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Revenue | **5775** | 4873 | 18.5 h |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Expenditure | **3071** | 2689 | 14.2 h |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Financial expenses | **648** | 608 | 6.6 h |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net income | **2056** | 1576 | 30.5 h |

---

![LOGO](g99247dsp0022.jpg)

Hydro-Québec, 75, boul. René-Lévesque Ouest, Montréal (Québec) H2Z 1A4

*Ce document est également publié en français.* 

www.hydroquebec.com