Hydro is key to Manitoba’s green transition

Opinion

Hey there, time traveller!
This article was published 13/07/2022 (932 days ago), so information in it may no longer be current.

TOM Brodbeck’s recent article on the Keeyask dam (“The good, the bad, and the ugly of Keeyask,” June 24) would have a stronger business case if it included an understanding of the relationship between addressing climate change and the enormous benefits Manitoba Hydro and Manitobans will receive when we move off fossil fuels.

Times have changed, and we need to get beyond the partisan battlefield concerns about too much debt or too much capacity.

His suggestion that the Keeyask dam is “over built capacity” ignores the reality that more than 70 per cent of Manitoba’s energy use each year comes from fossil fuels — gas for our vehicles and buildings. In a post-carbon future, we need to move from gas power to electric power, and shifting to low-carbon electricity to address climate change is no longer up for debate.

Even when Hydro’s exports and spot market sales are counted, we don’t have enough electricity. Manitoba Hydro predicts electricity generation will need to double just to replace the fossil fuels currently used in our vehicles and buildings alone.

Keeyask was built for the post-carbon future power needs in Manitoba. We need to reorient our thinking. Once we accept that our reality is not too much electricity but too little, we can examine the best path forward.

Droughts are almost certainly going to increase in frequency and severity. As we saw just last year, Manitoba Hydro is already extremely vulnerable to drought, because more than 95 per cent of our electricity comes from water. Building more hydro dams will only increase our drought-risk exposure.

As Manitoba’s Climate Action Team has shown in the Road to Resilience: Energy Solutions report, the smarter move is to instead reduce electricity consumption through vastly improved energy-efficiency measures including geothermal, while also greatly expanding our use of solar and wind energy backed up by commercial battery storage.

Droughts will still occur, but their impact on Hydro’s ability to power our grid will be much smaller if we have reduced our consumption and diversified our sources of electricity.

Debt levels at Manitoba Hydro do not have to increase as we diversify the grid. Power-purchase agreements, such as those already in place at Manitoba’s two wind farms and largest solar farm, bring new generation online, with all the upfront and operating costs covered by third-party investors in exchange for a long-term price guarantee from Hydro.

Transitioning off fossil fuels more quickly also means Hydro’s existing debt can be paid off sooner than expected. Instead of our hard-earned dollars fleeing the province every time we pay more than $2 per litre at the pump for imported gasoline or diesel, we’ll be using far cheaper electricity in our vehicles.

This means additional revenue for Hydro. Switching our buildings off fossil gas also improves Hydro’s finances, because its subsidiary CentraGas is prevented by provincial law from earning a profit. The electricity used in a geothermal system to both heat and cool a building is a money-maker for Hydro.

When Hydro’s financial position improves, there is less pressure for electricity rates to increase. The residential rate in Manitoba has already gone up dramatically in recent years, and now sits at more than nine cents per kilowatt hour (kWh). If another 2.5 per cent increase is imposed by the provincial government, the rate will rise to 10 cents per kWh.

This is already higher than the average price Hydro has received on the firm export market over the past seven years (8.5 cents kWh), and more than three times higher than the average spot market price (2.7 cents kWh) over the same time frame.

We recognize a significant number of laws, policies and practices must be reformed by government and the private sector before most citizens will have affordable access to electricity-based technologies. These barriers should be removed as quickly as possible so all Manitobans can afford to do their part in reducing climate pollution, while simultaneously saving money for other household priorities.

Manitoba is far behind most other provinces on climate issues. The Road to Resilience report series from Manitoba’s Climate Action Team shows how our province could again become a green-energy leader. Recognizing that we need additional low-carbon electricity to replace our fossil-fuel addiction is a necessary first step.

Choosing a smart approach that improves energy efficiency and diversifies our electricity sources will create incredible economic benefits for Manitobans, Manitoba Hydro and our economy as a whole, and we will be left scratching our heads wondering why we didn’t do this sooner.

Curt Hull is project director for Climate Change Connection. Dudley Thompson is a former Manitoba Hydro board member.