By: John Roschuk
Winnipeg Free Press, May 19, 201
Manitoba Hydro’s application to the utilities board for rate increases provides a golden opportunity for Premier Brian Pallister to do the right thing and save Manitoba Hydro and the Manitoba taxpayers by not allowing the rate increase and by keeping his election promise (Bipole III called ‘dumbest decision;’ Winnipeg Free Press, Oct. 25, 2014) to scrap the Bipole III project. It is not too late, and would curb the financial drain on Manitoba Hydro and the taxpayers.
The Bipole III capital cost represents a relatively small portion of the financial burden when all related costs are factored in. Bipole III will never generate positive revenue. It will be used to export electrical energy to “spot markets” at rates that generally are well below the cost of generation and transmission of the electrical energy.
Simply put, we will be selling at a loss. Rate increases will not salvage this mess. On the contrary, infusion of additional cash will simply increase the negative bottom line. The salvaged Bipole III infrastructure could be used to generate and transmit electrical power to Canadian markets at a profit.
It appears the only way Manitoba Hydro can survive is to transfer its financial burden to Manitoba taxpayers. Under the present structure, Manitoba Hydro will never be in a position to generate positive revenue from sales of electrical energy. It appears that all the Manitoba Hydro contracts are for sale of electrical energy to export spot markets. Spot markets were intended to provide utilities the ability to sell their surplus energy at substantially discounted rates, well below the cost of generation and transmission.
Manitoba Hydro’s financial predicament is a direct result of the NDP’s gross mismanagement. The decision to route the Bipole III line on the west side has cost Manitoba Hydro billions of dollars. It is intended to deliver electrical energy to the export market at a below-cost rate. Although Bipole III was intended to be a backup for Bipoles I and II, the west side Bipole III line is not compatible with Bipole I and II. The west-side route will have a severe negative impact on the west-side infrastructure, including subterranean, surface pipe lines, irrigation systems and public health and safety. Stray ground currents will accelerate corrosion of most conductive infrastructures. The negative impact of electric and magnetic fields have to be factored in to the overall cost. This has not been addressed in the public arena, although it is well documented globally by many highly credible research facilities.
If the premier allows the rate increases, he will be endorsing the NDP’s reign of terror that got us in this mess in the first place. If this ill-fated project is not “nixed”, Manitoba Hydro is doomed to extinction. The NDP has demonstrated time and time again that they are masters at mismanagement. Ontario Hydro is one example.
We challenge Premier Pallister to do the right thing. Stop this fiasco.
John Roschuk is a senior engineer technologist and a power quality consultant who has worked in the electrical field for 52 years, including 17 years with Winnipeg Hydro.
More From Manitoba Forward