WINNIPEG — Manitoba Hydro is asking the province's Public Utilities Board to approve an interim rate increase of five per cent as of Jan. 1.
The Crown corporation says the revenue is needed to help it deal with ongoing debt from recent capital projects, as well as this year's drought.
Last week, Manitoba Hydro said dry conditions were hurting surplus energy sales on the spot market.
It revised its financial outlook from a surplus this year to a deficit of between $190 million and $200 million.
The Progressive Conservative government was planning to set rate increases of 2.5 per cent a year for three years, but withdrew the required bill from the legislature.
The Opposition New Democrats have said the government should leave the matter to the Public Utilities Board, which has not yet set a date for hearings on the new rate application.
"Manitoba Hydro’s balance sheet is already highly leveraged and the corporation expects to spend 42 per cent of all revenues on interest costs in fiscal 2021/22," the utility wrote in its application to the board this week.
"Across Canada, utilities are trying to reduce debt and strengthen their balance sheets in order to provide flexibility to respond to the changing energy landscape, avoid stranding assets, and provide future investment necessary to address aging infrastructure.
"Manitoba Hydro’s current debt to equity ratio is 86 per cent. All other peer Crowns have achieved targets below that or have plans to achieve lower levels of debt within 10 years."
This report by The Canadian Press was first published Nov. 16, 2021
The Canadian Press