Manitoba Hydro profits plummet again this year

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This article was published 26/11/2016 (3330 days ago), so information in it may no longer be current.

Manitoba Hydro is projecting a profit of $25 million this fiscal year — about half the amount it earned last year and just a fraction of what it made the year before that.

In a quarterly report tabled in the legislature this week, the province’s largest Crown corporation said it suffered a consolidated loss of $70 million in the six months ended Sept. 30. That compares to a net loss of $17 million the previous year. Manitoba Hydro makes most of its money during the winter months, when there is a larger draw on electricity and natural gas, its two main sources of revenue.

Hydro attributed the poorer showing so far this year to higher expenses, such as finance costs, capital taxes and depreciation.

Revenues from electricity sales within Manitoba totalled $622 million for the six-month period, an increase of 0.3 per cent over the same time last year. The increase was mainly a result of an increase in rates. Revenues from out-of-province sales rose by 0.8 per cent.

Last fiscal year, Hydro earned a profit of $49 million. The year before that, it made $136 million. The corporation has greatly increased its debt recently due to such major construction projects as the Keeyask dam and the Bipole III transmission line.

Construction costs in the first six months of fiscal year 2016-2017 totalled $1.3 billion, compared with $1 billion in the same period the previous year.

Expenditures included $535 million on the Keeyask project, located on the lower Nelson River 725 kilometres northeast of Winnipeg, and $526 million for the Bipole transmission line.

Due to the large ongoing construction costs, Hydro is expected to apply for significant consumer rate increases over the next decade or so, officials with the utility have warned.

larry.kusch@freepress.mb.ca