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    Consumer group wants to hear Hydro's rationale for rate hike


    November 17, 2021 - Carol Sanders

     

      A coalition of consumers says Manitoba Hydro needs to stop leaving its customers in the dark when it comes to the big picture of the Crown corporation's long-term financial health.

      On Monday, the publicly owned power company filed a rate application with the Public Utilities Board requesting a five per cent interim increase in electricity rates to take effect Jan. 1.

      The increase would cost the average residential customer who uses electricity to heat a home an additional $10 per month and $5/month for those who don't, Hydro said in a news release Tuesday.

      The five per cent increase it is now seeking is larger than the 3.5 per cent increase Hydro president and chief executive officer Jay Grewal in June told a legislative committee was needed.

      Manitoba Hydro has blamed the need for the rate increase on the ongoing drought, which, it says, has reduced 2021 export sales by $400 million and is expected to lead to a loss this fiscal year of between $190 million and $200 million.

      The Consumers Coalition -- which includes Harvest Manitoba, Consumers' Association of Canada (Manitoba), and Aboriginal Council of Winnipeg -- is questioning Hydro's financial assumptions, and wants to see the long-term outlook for the hydroelectricity producer.

      "We appreciate there is a drought in Manitoba, however, this is an expected part of the business cycle that Manitoba Hydro plans and prepares for," Gloria Desorcy, Manitoba executive director Consumers' Association of Canada, said in a news release.

      "What increase is actually justified? We don't know as Manitoba Hydro has not had a full hearing into the rates it charges customers for three years, leaving consumers in the dark about its big-picture financial health."

      Since the last full rate hearing took place in 2018, Manitoba Hydro has brought into service both the Bipole III transmission line and the Manitoba-Minnesota transmission line, as well as the first unit of the Keeyask generating station, the coalition noted.

      It also confirmed a 30-year export sale with Saskatchewan Power, and completed Strategy 2040, a comprehensive review of its operations and forecasts, which has not been made public.

      "The current export crunch at Hydro highlights how important it is for the PUB to order a full status update hearing into Hydro's finances in 2022," the Consumers Coalition said.

      It said it is confident the PUB will lead an efficient interim rate process, "while recognizing the need to return to consistent, orderly, transparent and evidence-based processes with a view to Manitoba Hydro's short-, medium- and long-term financial health."

      The Crown corporation was directed by the provincial government to file an application with the Public Utilities Board earlier this year, after it scrapped Bill 35 (Public Utilities Ratepayer Protection and Regulatory Reform Act) and its associated 2.5 per cent electricity rate increase that was to take effect Dec. 1.

      carol.sanders@freepress.mb.ca

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