Sala stands behind last year’s Hydro rate freeze

WINNIPEG — The minister responsible for Manitoba Hydro said he stands behind ordering last year’s rate freeze even though it was followed by this year’s “rate shock” needed to urgently address the challenges of drought and debt.

“We know that Manitobans are struggling with affordability challenges,” Adrien Sala said Tuesday, noting a 2025 electricity rate freeze was important at the time to give Manitobans “a bit of a break.”

Manitoba Hydro proposed rate increases of 3.5 per cent per year from 2026-28 but that plan was rejected by the Public Utilities Board last week, ruling the increases were not enough “to protect the financial health of the utility.”

The energy rate regulator ordered an interim increase of four per cent this year.

The NDP government should never have frozen hydro rates while the Crown power utility is dealing with $25 billion in debt, Progressive Conservative finance critic Lauren Stone said Tuesday.

“It was irresponsible of the NDP to interfere last year by announcing a rate freeze,” Stone said in an interview. “I said it a year ago, and I’ll say it again, a rate freeze would mean a rate shock. And that is unfortunately what Manitobans are now facing.”

At a committee meeting last year, the member for Midland said she asked what Manitoba Hydro’s planned rate increase was, had the NDP not imposed a rate freeze. She was told Hydro was seeking a 2.5 per cent rate increase.

“Had Manitoba Hydro gone ahead with that 2.5 per cent (increase) then, perhaps that rate might be lower today, and we’re not seeing that four per cent that was announced by the PUB,” Stone said.

Consumer groups and others questioning Manitoba Hydro’s bottom line and rate increases have raised concerns about spending.

Stone called for a review of spending and productivity at the corporation that’s been referred to as Manitoba’s Crown jewel. She proposed an independent third-party review that is transparent and “as accountable as possible to the public.”

The state of the utility’s aging equipment was on display last week with a multiple-day power failure in Pimicikamak First Nation in -30 C temperatures, with access to the remote northern site limited.

Sala said he wasn’t sure what the cost will be for the power outage that displaced thousands of people, or if Manitoba’s projected $1.6-billion deficit will grow, but dismissed concerns that a recession is looming.

“I’m optimistic about the future of Manitoba. I think we’ve got so many great opportunities to pursue. I think our government is doing the important work of attempting to unlock those economic growth opportunities while we lean into fixing health care and ensuring that Manitoba is the safest place possible for all of us.”

Sala said he stands by the NDP government’s promise to balance the books by the 2027 election but wouldn’t commit to stepping down if it doesn’t.

“We’ll cross those bridges when we get there. I remain completely focused on ensuring we deliver on that goal, and I’m excited about bringing forward our next budget so we can show Manitoba the progress we’ve made.”

The best way to grow the economy and increase investor confidence is by ensuring taxes remain low, reducing red tape, streamlining economic development processes, reducing project approval delays and improving public service productivity — measures the NDP haven’t prioritized, Stone said.

“There’s quite a few examples there of where the NDP continues to mismanage Manitoba’s economy,” the Tory said. She cited a Fraser Institute survey showing Manitoba’s attractiveness to mining investment globally dropped to 26th place in 2024 from sixth in 2023. There have been delayed hydro hookups for new construction projects that also reduce investor confidence, Stone said.

“The NDP, over the past two years, they’ve really demonstrated a lack of urgency when it comes to the economy, and that’s why they won’t be able to truly balance the budget or invest in Manitoba’s priorities,” Stone said.

» Winnipeg Free Press