Hydro rates will increase Aug. 1 for Manitobans

Manitobans are about to be dinged with higher hydro bills. 

The Public Utilities Board (PUB) has approved a 3.95 per cent increase in Manitoba Hydro rates, effective Aug. 1, 2015.

That means the monthly bill of an average residential customer — without electric space heat — will go up about $3.20 while those with electric space heat will pay about $6.11 more each month.

Hydro will use 1.8 per cent of the rate increase to support ongoing operations while the remaining 2.15 per cent will be added to an account used to fund the Bipole III project.

The PUB says the increase now will help cushion the "rate shock" when Bipole III and other major hydro projects come into service.

Manitoba Hydro is spending about $20 billion over the coming 10 years. The most significant projects include Bipole III at a cost of $4.6 billion, the Keeyask generating station at $6.5 billion, maintenance of existing facilities at $5.9 billion, and energy efficiency programs at $700 million.

These investments will increase operating costs and require higher electricity rates, the PUB said. Manitoba Hydro forecasts electricity rates will need to increase by 42 per cent by 2024.

"These higher rates will have a significant impact on all Manitobans but especially lower-income Manitobans. Manitoba Hydro is therefore directed by the [PUB] to develop a bill affordability program that is harmonized with Manitoba Hydro's other programs supporting lower-income ratepayers," states the PUB release.

Eric Robinson, the minister responsible for Manitoba Hydro, issued a statement about the rate increase approval on Friday.

In it, he said Manitoba Hydro's investments were creating thousands of jobs and training opportunities and other provinces were seeing rate hikes as high as 26 per cent over the next three year.

The statement continued, "Here in Manitoba, regular small increases will fund Hydro projects that will mean a strong and reliable corporation into the future."

Low-income Manitobans paying for poor cost control: association

According to Manitoba's opposition Tories, the rate increases are a result of "mismanagement of the utility." Officials with the Manitoba Progressive Conservatives said Manitobans simply can't afford the rate hikes. 

The Manitoba Branch of the Consumers Association of Canada has similar concerns.

According to executive director Gloria Desorcy, lower-income users are going to face a crunch.

"When we listen to consumers who are having trouble paying their bills, who are deciding, you know, 'Do I buy my prescriptions this month or do I pay my hydro bill? Maybe I can take my pills every second day?' You know, when you're hearing these kinds of things from consumers, you figure something more needs to be done," said Desorcy.

She said it's hard not to feel as if consumers are paying for the cost of poor estimations and lack of cost control on capital projects by Manitoba Hydro.

"As we move into more capital projects – Keyask [for example] has now begun – that's kind of frightening for consumers," she said.

According to Manitoba Hydro CEO Scott Thompson, the company already has affordability programs in place.

"I think it's just increasing engagement with various stakeholder groups and interveners that were involved with the hearing – those that represent some of the consumers – to see what, if anything, more we can do," he said.

Thompson said the program would help people to reduce their energy consumption.