Cape Breton Post

In Manitoba, the provincially owned electrical utility is planning a massive expansion of its hydroelectric operations, even though its profits from the sale of electric power have fallen dramatically, to the point that Manitoba ratepayers are actually subsidizing the sale of cheap power into the U.S. grid.

It sounds somehow familiar. Here is a sample of comments from Graham Lane, a former head of Manitoba's public utilities board, talking about the wisdom of using ratepayers to pay for power for others. Lane was presenting a paper for the Frontier Centre for Public Policy.

"While many Manitobans are aware of the provine's massive expansion of Manitoba Hydro's northern hydroelectric generation and transmission facilities, few understand the negative implications for their own pocketbooks. Recently, Manitoba's NDP government has unleashed a barrage of propaganda in support of the planned costly development, including the repeating of an implausible claim originally made by former Manitoba premier (Gary) Doer that hydroelectric power is 'Manitoba's oil,' in essence, equating Manitoba's hydroelectricity prospects with Alberta's oil and gas opportunities.

"Despite the fact that Hydro's ratepayers will be required to meet the full rate implications of the government's direction, the level of openness and transparency with respect to these plans have been woefully and long absent. Hydro has already spent billions and made commitments to First Nations, American utilities, contractors, manufacturers, employees and trainees, all before an independent and expert review of the plans and options has been undertaken and final approvals for proceeding secured.

"I make the case that the revenue, cost, demand and export price forecasts provided by Hydro (often cited by the government in support of its plans) are not worth 'a grain of salt' as every major forecast made by Hydro over the past decade has been widely off the mark. There have been major cost overruns and other forecasting errors, and circumstances have changed following the inauguration of the plans.

The challenges faced by Hydro do not exist in a vacuum - the province's own balance sheet is laden with debt, with annual deficits in the past as well as in the future outlook (without even considering the prospects of future restraint by the federal government as to the transfer grants that keep this province 'alive'). This paper supports the position that the underlying financial position and prospects of the province and Hydro, and the risk inherent in the government's Hydro expansion plans, doesn't support a gamble of tens of billions.

It's a different province, different projects than Muskrat Falls, but interesting reading nonetheless.

Almost an echo of things heard here: "I hold that the bodies presently providing 'oversight' with Hydro are conflicted and unable to properly protect ratepayers. The planned Public Utilities Board Needs For and Alternatives To Review is, unfortunately, a sham. Other matters associated with Manitoba Hydro's actions clearly require independent audits, along with a proper independent review and reconsideration of the present plans. . . . The ratepayer communities, which, in the end pay the bills, must be truly involved in the process."


Link to Site

Click here for more on the Frontier Centre for Public Policy