Hydro claims not plugged into truth

Opinion

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This article was published 02/05/2022 (969 days ago), so information in it may no longer be current.

It’s either bad strategy, bad messaging, or just another example of cynical politics in this province.

Last week, Opposition NDP Leader Wab Kinew announced his caucus will prevent Bill 36 – The Manitoba Hydro Amendment and Public Utilities Board Amendment Act – from being passed by the Stefanson government during the current spring session.

Under Manitoba Legislative Assembly rules, the Opposition can delay the passage of up to five bills until the fall session. Because of the government’s large majority in the House, it is a near-certainty Bill 36 will become law in November.

Given that fact, why would the NDP bother stalling the passage of Bill 36 for a few months? Where’s the win for Team Kinew?

The answer is the NDP see it as an opportunity to stoke fear and build support in the run-up to next year’s election. They think they can ratchet up public anger and anxiety as they did with Bill 64 (the Education Modernization Act) last year, and use that to raise more money and sell more memberships.

The problem for the NDP is that this isn’t Bill 64. It’s a totally different scenario.

When he announced that passage of Bill 36 would be delayed, Kinew claimed the legislation would guarantee annual rate increases of five per cent for years into the future. “It’s looking like this is going to be the start of five per cent increases at Hydro year after year,” he said.

Kinew either hasn’t read the legislation, can’t tell the difference between up and down, or he’s pulling your leg. Maybe it’s all three.

Under Bill 36, electricity rates would be set every three years (starting in 2025) and capped at five per cent or the rate of inflation, whichever is lower. That’s right: lower, not higher.

In other words, Bill 36 doesn’t guarantee perpetual Hydro rate increases of five per cent or even higher. It does the opposite.

It caps increases at five per cent in years when the rate of inflation is higher than that percentage. In years when the inflation rate is below five per cent, however, the rate increase will be the same as the inflation rate.

Undeterred by actual facts, Opposition Hydro critic Adrien Sala claims, “The fact that they’ve capped it at five per cent is not a protection for Manitobans. … That is a huge rate increase for Manitobans.”

No, it’s not. It means increases would be at or below the rate of inflation, but never more than five per cent. That’s not unreasonable for Manitobans. If anything, it’s unreasonable for Manitoba Hydro, which is struggling under billions of dollars of debt left to it by previous NDP governments.

Bill 36 also allows for the “retail supply of power” by entities other than Manitoba Hydro. Sala claims that opens the door to privatization, but the reality is that increased electric-vehicle sales will require many more locations for those vehicles to be charged.

Manitoba Hydro can’t afford to build and staff charging stations all over the province. It makes more sense for private operators to incur those costs. That way, Manitoba Hydro gets paid for supplying electricity to the station, but incurs none of the risks of actually running the station.

That’s not privatization; it’s sensible management.

Bill 36 would also require the PUB to review and make recommendations about any Hydro proposal to develop a major new power generating or transmission facility, or enter into a new major long-term power purchase or export contract.

That could help future governments avoid the same costly mistakes as previous NDP governments made on Keeyask, Conawapa and the Bipole III transmission line. After the multi-billion dollar cost overruns that have hobbled Hydro with debt, how is independent evaluation of future projects a bad thing?

It isn’t, and that’s a problem for Kinew and Sala.

They need to read the room. With Manitobans struggling with runaway inflation and natural-gas rates about to jump by more than 20 per cent, opposing a plan to cap rate increases and avoid cost overruns is the wrong move.

Instead of opposing a five per cent cap on Hydro rate increases, they should be fighting for a lower cap to be implemented right away, not three years from now.

That would sell memberships.

 

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