Hydro and drought – a litany of excuses

Hey there, time traveller!
This article was published 13/12/2023 (673 days ago), so information in it may no longer be current.

Manitoba Hydro has known for a long time that droughts come about every 10 years or so.

As glaciers in the Rockies disappear and the effects of climate change disrupt normal patterns, it is likely that drought on the Prairies could even become frequent. The last one in 2002-2003 cost Hydro over $400 million in imported power from the U.S.

This current drought has turned an expected Hydro surplus of $450 million into a loss of $160 million so far this year, a $610-million swing.

Hydro’s attitude has always been “the good years will outweigh the bad… don’t worry.” It has done nothing to mitigate the risks of climate change and periodic drought. It has done nothing to develop robust options for electrical generation in drought years.

Hydro has even argued against alternatives including wind power, to the point of misleading our government and the public about the costs involved.

However, now the game is up. Wind energy’s total costs, capital and operating, are less than four cents a kilowatt-hour, (kw/h). Contrast that with Keeyask’s cost of well over 13 cents kw/h. Both costs exclude the costs of transmission.

Often the argument against wind power is that it is not a steady source. When the wind doesn’t blow, the needed power to sustain the grid must come from somewhere. That “somewhere” in Manitoba is our huge water storage capacity.

It works like this. When the wind blows, Hydro reduces the power output from our dams and keeps the water for later use. In other words, the wind energy is “stored” in our reservoirs. Nations around the world have figured out how to use up to 40 per cent of wind energy in their grids. Most of these countries do not have our great advantage of water storage. Surely Manitoba Hydro can figure this out, too.

Quebec is also richly endowed with hydro power, but it has developed a thriving wind energy industry, with 3,920 MW installed capacity. In contrast, Manitoba only has two wind farms for a total of 259 MW, and Hydro fought tooth and nail against both of them. Only a direct order from the government got these wind farms built. They have operated successfully for 20 years.

If we need further confirmation that Hydro has failed to recognize the value of wind energy, just look at North Dakota. That state has virtually no hydro power, yet in 2023 it has 4,300 megawatts (MW) of wind power.

How did North Dakota manage that success? Because a significant portion of its wind power is backstopped by Manitoba. Hydro “sells” them its ability to provide backup using our reservoirs when the wind doesn’t blow. In other words, we gave them some of our storage capacity to help them build more than 16 times our wind power.

Worse, that also means North Dakota farmers and municipalities enjoy the land rental and municipal taxation paid by the wind farms. It also means all the construction employment was in North Dakota, not Manitoba. All the new jobs maintaining the wind farms are in North Dakota.

In contrast, we provide access to our water storage to North Dakota, compromising our capacity to add wind to the Manitoba grid, provide rental income to Manitoba farmers and tax income to Manitoba municipalities. The RM of Lorne gets $467,000 a year in taxation from the St. Leon wind farm — not a small amount for an RM.

Why are Manitobans so far behind in using our enormous wind power capacity? Clearly, there are no technical reasons. Jurisdictions around the world, most without our water “battery,” have installed over 800,000 MW of wind power, growing at about 10 per cent annually.

Furthermore, in 2010, a Hydro study showed how 1,200 MW of wind could be installed in Manitoba for one-tenth of the cost of Keeyask. Given the enormous technical improvements in wind energy since then, the contrast today is likely far greater.

Wind would have been a wonderful resource to have in our current drought conditions. This study was kept confidential but can be found on some websites.

The main reason we are so far behind in wind power development is that the corporate culture of Manitoba Hydro is deeply stuck in hydro-electric power and resistant to the winds of change.

Hydro has done everything in its power to stop wind generation in our province, even to the point of helping North Dakota become a wind energy giant.

If that is to change, Hydro’s new board of directors will have to challenge this corporate culture. The board should bring in external resources to help kick-start an industry that will bring much-needed clean energy, greater grid stability and resilience, especially in times of drought, and many new jobs and increased tax revenue.

A good starting point would be to speak with Hydro Quebec.

Tim Sale is a former provincial minister for Manitoba Hydro.