Six months after its last bump, Hydro files for another rate hike By: Larry Kusch Posted: 7:00 PM CST Friday, Nov. 30, 2018 Last Modified: 7:36 PM CST Friday, Nov. 30, 2018 Updates

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This article was published 29/11/2018 (2121 days ago), so information in it may no longer be current.

Manitoba Hydro is seeking to boost electricity rates by 3.5 per cent, effective April 1.

If it is successful, consumers would face a second substantial power-rate increase in 10 months, after the utility received permission to jack them up by an average of 3.6 per cent last June.

Hydro filed its latest rate application Friday with the Public Utilities Board.

The Crown corporation is also seeking a streamlined approval process for its latest request, eliminating public hearings, citing the length of the previous proceedings.

Hydro is asking the 3.5 per cent hike apply across the board to consumers and industrial users alike. It calculates such an increase would generate $59 million and result in a “modest” corporate profit of $31 million in 2019-20.

Without the increase, Hydro said, it would likely incur a loss in electrical operations of $28 million.

Winnipeg lawyer Byron Williams, who represents the Manitoba branch of the Consumers’ Association of Canada, said his client doesn’t believe consumers should be subjected to two hydro increases within a 12-month period.

“The bad news for ratepayers is (the proposed increase) is well above the rate of inflation,” he said, adding that few consumers are receiving salary increases of that magnitude. “So, it’s an additional hardship for people struggling to make ends meet.”

In its previous rate application before the PUB, Manitoba Hydro sought a 7.9 per cent increase and said its financial situation was so dire it would need rate hikes of close to eight per cent for another five years after that.

Williams termed that request as “beyond the zone of reasonableness.”

He said the consumers association also rejects the idea the approval process be streamlined, foregoing public hearings. The experience with Manitoba Public Insurance, which also has its rates approved by the PUB, is the hearing process can be both timely and effective, he said.

In its brief to the PUB, Hydro said it is projecting a net income for the current fiscal year (2018-19) of $51 million.

“The requested 3.5 per cent rate increase… generates a modest level of net income under average water-flow conditions that will assist in gradually building the revenue base and reduce the risk of the corporation incurring a loss in 2019-2020,” the corporation said.

It said its request is aligned with PUB-approved rate hikes since 2015 “and keeps Manitoba’s customer rates and estimated bill impacts among the lowest in North America.”

Hydro is carrying a huge debt due to dam construction and the building of a major new transmission line to southern Manitoba from the North.

Meanwhile, revenues from export sales have fallen below expectations in recent years.

Hydro spokesman Bruce Owen said Friday the Crown corporation is currently conducting a comprehensive review of its operations, forecasts and financial plans that will allow it to chart a longer-term course.

“We anticipate filing a more fulsome electric (general rate application) to the PUB in late 2019,” he said in an email.

larry.kusch@freepress.mb.ca

Larry Kusch
Legislature reporter

Larry Kusch didn’t know what he wanted to do with his life until he attended a high school newspaper editor’s workshop in Regina in the summer of 1969 and listened to a university student speak glowingly about the journalism program at Carleton University in Ottawa.

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