The Manitoba 2012 budget highlights state that projects like Bipole III (transmission line), and Keeyask and Conawapa (planned generating stations) “will grow our power exports, create jobs and keep rates affordable for Manitoba families.”
As noted in the Brandon Sun on April 4, Hydro applied to raise rates 3.5 per cent this year (although a lower rate was approved). As 3.5 per cent is well above the level of overall inflation, this may not have been everyone’s idea of keeping “rates affordable for Manitoba families.”
Because of the recent advent of shale gas technology, the North American energy market has been turned inside out. Thus Hydro is faced with the dilemma that every kilowatt of power they export is sold at a loss. It could be many years, like 10 or 20, before this changes in any significant way.
There is nothing Hydro can do about the shale gas challenge, but there is plenty they could do about re-examining their grandiose development plans, namely the building of Bipole III, Keeyask and Conawapa for $20 billion, which may do little more than create more capacity to export more surplus power at a subsidized price.
A giant power export scheme, losing money year after year, would be most unlikely to contribute to keeping “rates affordable for Manitoba families.”
The above-mentioned infrastructure would almost triple Hydro’s debt, which again will have the opposite effect of keeping “rates affordable for Manitoba families.”
With Canadian household debt, and debt at various levels of government at alarming levels (as mentioned again this week by the Bank of Canada’s Mark Carney) there is every reason to fear that Hydro’s plan will simply add another layer of economy-stifling debt to be passed on to us, the Manitoba taxpayer, our children and grandchildren. The problem is that it’s not their money that they are gambling with.
Republished from the Brandon Sun print edition May 9, 2012