Independent experts are calling the proposed Hydro $20-billion expansion plan risky. La Capra Associates are world-renowned experts who were commissioned by the Public Utilities Board to look into the NDP’s hydro plan. The report produced by La Capra shows the government is on the wrong track.
The report says the NDP’s Preferred Development Plan is of limited economic advantage over the alternatives considered. The report criticizes how the NDP government is rushing into these plans, noting the year Manitoba may need extra power generation options is as late as 2033, a long time from now. It also debunks Manitoba Hydro’s rationale for building these dams way ahead of when they are needed, stating there is no proof Manitoba Hydro can sell excess power to the United States for profit over the longer period of time.
La Capra calls the government’s Manitoba Hydro expansion plan out of date, misleading and extremely high risk. This begs the question: Why should Manitobans support the NDP’s high-risk proposal?
The report concludes by saying Manitoba Hydro’s plan will generate revenue for the government, as at least half of the benefits to these plans over the next several decades will be captured by the provincial government alone and not Manitoba Hydro ratepayers. For the first 35 years, the province will be collecting tax benefits from items such as higher rates, water rental revenue and a one-per cent surcharge to Manitoba Hydro based on the amount of money it borrows.
According to documents filed by Manitoba Hydro at Public Utilities Board hearings, the provincial government will collect $117 million in water rental fees and $100 million in loan guarantees from Manitoba Hydro. By 2032, those fees are projected to increase to $140 million for water rental and $230 million in loan guarantees over the course of the proposed development.
The total tax and fee hikes over the next 20 years alone is more than $9 billion.
Manitobans will pay higher hydro rates while shouldering all of this risk. The NDP government will collect more tax revenue from Manitobans, and assumes none of the risk. We don’t think this sounds good for Manitobans.
Critic for Manitoba Hydro
Progressive Conservative MLA
Republished from the Brandon Sun print edition May 7, 2014