Hydro increases set for three years

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This article was published 09/07/2021 (1615 days ago), so information in it may no longer be current.

Manitoba’s government announced on Thursday its intention to raise Manitoba Hydro rates by 2.5 per cent per year over the next three years.

Crown Services Minister Jeff Wharton and Finance Minister Scott Fielding told the media during a joint conference call that their government will introduce legislative amendments to Bill 34 to make those rate increases a reality during the fall legislative session.

Bill 35 was introduced in the last legislative session, but the Manitoba NDP used their power as the Official Opposition to delay passage of the bill until the fall.

The bill was created in response to the Wall Report into multibillion-dollar cost overruns at major Manitoba Hydro projects during the tenure of Manitoba’s previous government.

If passed, it would change how the Public Utilities Board sets rates for utilities and oversees future major projects. Rates would be set for multi-year terms under the bill.

As the bill is implemented, the provincial government would step in to set rates as the PUB prepares for the changes.

“This means that Manitoba households and businesses will have stability and certainly as our economy recovers from the COVID-19,” Wharton said of the increases. “Today’s announcement balances the needs for Manitoba Hydro’s to repay their massive debts created by the former government’s reckless mismanagement and keeps our electricity rates among the lowest in North America.”

Last week, Manitoba Hydro president and CEO Jay Grewal told a legislative standing committee that the Crown corporation was looking for 3.5 per cent increases over the next three years.

The lessened amount, Wharton and Fielding said, is a compromise between what Hydro was asking for and what Manitobans can afford as the COVID-19 pandemic persists.

“We think it’s an appropriate balance between protecting ratepayers and paying for past mistakes by the former NDP government,” Fielding said. “It provides predictability, it provides stability for residents as well as business users. It’s going to be voted (on) by all members of the legislature through Bill 35, which we think is important.”

According to Wharton, the rate increases will save Manitobans a total of $40 million that would otherwise have been spent on rate increases while amounting to a price increase of $35 per ratepayer.

Additionally, he said these three years of rate increases represent the lowest such increases in 10 years.

The ministers were asked if their government could also be accused of interfering with Manitoba Hydro as they have accused the NDP of having done, setting rates without the PUB and not having applied for a general rate application since 2016.

In response, Fielding reiterated his comments about seeking a balance with the announced rate increases.

Speaking to the Sun by phone Thursday afternoon, the NDP’s critic for Manitoba Hydro, Adrien Sala, said it was disappointing the government is raising electricity rates without an independent review from the Public Utilities Board.

“That’s hugely concerning for a lot of Manitoban families who are facing major affordability challenges right now,” he said. “Costs are going up, costs of rent, costs of food and so families on fixed incomes and seniors who are facing these challenges now have a situation where their own provincial government is piling on and creating more and more challenges for them to face. Obviously, this isn’t a time to be creating more economic uncertainty for Manitoban families.”

Sala believes that the rates being changed by cabinet twice in a year instead of by the PUB means that Manitobans will never know if the rate increases being implemented by the government were justified.

“Bill 35 will ensure that they (the government) will interfere in perpetuity,” he said. “This is a really concerning bill that’s going to be passed this upcoming fall … it will all but ensure that Manitobans will be guaranteed to overpay for electricity on a regular basis.

In a statement emailed to members of the media, Manitoba Liberal Leader Dougald Lamont called the announcement “a blatant declaration of corruption.”

“The PCs are abusing their power and putting Hydro’s financial future at risk by fixing prices in the hope of buying some political popularity,” Lamont stated. “Hydro’s rates should be set by the PUB after public hearings, not figured out on the back of a napkin in the premier’s office.”

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