Hydro approved for three rate hikes worth 10.5 per cent cumulatively

Every time Pat Fenske turns on the oven or uses hot water, it could put a dent in the time she spends curling or golfing.

The 79-year-old Selkirk resident, who’s on a fixed income, has calculated how much more of her pension be spent on her utility bills during the next two years following the approval of rate increases for Manitoba Hydro.

“It will cost me more than $260 per year, or more, by 2027,” Fenske said. “Every time a fixed item goes up that significant, I have to look at what pleasures in life I have that I have to take out of my life.”

She said she wants to stay active and healthy, but rate hikes make it tougher.

“This affects your life when you’re a pensioner,” she said.

The Public Utilities Board has finalized a four per cent general rate increase for Manitoba Hydro, effective Jan. 1, 2026. The PUB also approved general revenue increases of 3.5 per cent for Jan. 1, 2027, and three per cent for Jan. 1, 2028.

The PUB said the actual rate increases for those years will be different for certain customer classes, and will be determined in a future filing by Manitoba Hydro, but the board believes it should mean residential customers pay about 3.8 per cent more in 2027 and 3.3 per cent higher in 2028.

“The rate differentiation relates to a need to ensure that each customer class pays its fair share of Manitoba Hydro’s costs that are properly attributable to each class,” the board said in its decision.

The regulator said the increases are due to financial pressures faced by the utility, including severe drought conditions that have reduced the amount of water flowing through its hydroelectric dams. Manitoba Hydro has said the flows are close to the second-lowest in 112 years.

The drought has hit the utility so hard that from between the time it filed its rate application in March 2025, to the oral hearings before the regulator in November, it’s financial outlook went from a projected net income of $218 million to a projected loss of $409 million — a $600 million swing.

At the same time the board allowed higher bills, it recommended the provincial government step in to help low-income earners.

It wants the province to conduct a review with the aim of creating an energy poverty reduction strategy.

It has recommended a refundable tax credit for low-income customers be established “to help reduce (the) annual energy burden.”

Katrine Dilay, a lawyer with the Public Interest Law Centre, which represented a coalition of the Consumers’ Association of Canada Manitoba branch, Harvest Manitoba and the Aboriginal Council of Winnipeg at the rate application hearings, said the cumulative increase is about 11 per cent for hydro customers.

“The rate increases are now consistently above inflation and almost double what Manitoba Hydro was projecting three years ago.”

Dilay said the coalition is pleased the regulator told the utility to take measures to control operating costs, and expressed concern about the rising costs of capital projects, as well as recommend both the utility and the government to look at energy poverty.

“We heard there are ratepayers who are making some really hard choices out there, including not using their ovens to cook in order to save electricity and other folks not using their air conditioning as well as heating specific rooms,” she said.

Finance Minister Adrien Sala, who is responsible for Manitoba Hydro, said during an unrelated news conference that “we want to see rates remain low” and the province will look into the recommendations on energy poverty and a refundable tax credit.

“There are some concerns about the proposal to see a three-and-a-half per cent revenue increase next year and to see that be split into different classes,” Sala said. “We will be looking to understand more about how the PUB would like to see that go forward.”

He said the government will review the regulator’s recommendations, which were released Thursday, more closely.

— with files from Gabrielle Piche

kevin.rollason@freepress.mb.ca