According to Manitoba Hydro’s third quarter report released Feb. 14, a record 4,632 MW electrical demand occurred on Dec. 31.
As cold as that day was, the demand, and nine-month revenue and income do not support Hydro’s Preferred Development Plan. The present capacity of 5,675 MW is well able to supply the demand that will likely fall short of Hydro’s forecast once adjusted for the abnormal weather.
According to Elenchus Research Associates, one of PUB’s experts, Hydro’s five-year-ahead forecasts have been over-predicting both demand and energy use since 2005 due to the 2008 recession.
PUB expert La Capra Associates says Hydro’s conservatively calculated projections are in advance of their 2021 need, probably by a decade.
The export revenue, up by $58 million to $338 million due to cold weather and other factors, is disappointing compared to $828 million in 2005. The price per kWh decreased from 3.68 to 3.67 cents. The cost of new hydro generation is more than 10 cents per kWh (we pay 6.5 cents).
Hydro’s low firm price and opportunity sales are not encouraging the U.S. to buy from Hydro even with abnormally coId weather, because of cheaper natural gas generated electricity.
Hydro notes rate increases Manitoba ratepayers are suffering represent most of their profit increase. We will be even more vulnerable to increasing rates and reduced reliability with the “eggs-in-one basket” northern hydro generation plan.
There is time for a proper review that would include Bipole III costs, allocated to the alternatives that require it.