Manitoba Hydro fights order to freeze rates on reserves

Hey there, time traveller!
This article was published 31/05/2018 (2836 days ago), so information in it may no longer be current.

Manitoba Hydro has challenged the Public Utilities Board’s legal right to order a rate freeze for residents of First Nations.

The PUB has no legal authority to set affordability rates by creating a customer class “not defined solely on the basis of the region of the province in which customers are located,” Hydro said, demanding the PUB immediately stay that section of the board’s recent ruling.

The Crown corporation took its stance in a letter this week, on the second-last day of its appeal period before 3.6 per cent overall increases take effect Friday.

There was confusion Thursday about what will happen to the rate increase: the PUB said it won’t take effect until Hydro’s challenge gets dealt with; the utility said it goes into effect Friday, as scheduled.

Neither side had budged by late afternoon.

Hydro’s challenge of the board’s decision means no increases or rate changes of any kind will take place Friday, PUB executive director Darren Christle said Thursday morning. “Same rates as they are today,” he said.

Because any change to the board’s order to freeze rates on Manitoba reserves would have an impact on other customers’ rates to maintain 3.6 per cent overall, Christle said, no changes will take effect until the matter is settled.

He was uncertain if any increases ultimately approved could be made retroactively to June 1.

However, Hydro director of corporate communications Scott Powell said: “Manitoba Hydro will implement rate increases approved the Public Utilities Board, effective June 1, 2018, that reflects the approved 3.6 per cent increase in revenue for the utility. The new rates will be implemented effective tomorrow (Friday), as ordered by the PUB.”

It will include the rates freeze on reserves, Powell said.

Crown Services Minister Cliff Cullen said Thursday the provincial government is leaving it to the PUB to sort things out, while the Assembly of Manitoba Chiefs is already considering legal action to protect the rates freeze for reserves.

Christle said the PUB is forming a panel from its pool of board members, which will meet Friday to discuss how to proceed.

“There’s definitely not going to be a decision tomorrow,” he emphasized.

If Hydro doesn’t like the outcome when that panel rules on its request, the Crown corporation can go to the Manitoba Court of Appeal, Christle said.

“We are sharing the (Hydro) filing with the intervenors of record,” and those intervenors have the right to file their own comments to the PUB. He could not predict how long the process will take.

The PUB ruled a month ago against Hydro’s request for a 7.9 per cent annual rate increase, which Manitoba Hydro had hoped to apply each of the next six years. A 3.6 per cent overall increase is all that was justified, the PUB said.

The board had ordered Hydro to freeze the rates for First Nations reserves for 2018-19.

In doing so, the ruling made errors in jurisdiction and law in going beyond its mandate, Hydro lawyers told the board.

“Government has today received Hydro’s review and vary application to the Public Utilities Board, which among other things calls for the removal of the order to create an on-reserve Hydro rate class. It will take some time to review this application given the length and depth of the document,” Cullen said.

“What we can say today is something that has been clear since we formed government (in 2016): we respect the PUB process and will not stand between Hydro and the Public Utilities Board as they work collaboratively in the days ahead on what’s best for Hydro ratepayers.”

The AMC denounced Hydro’s request Thursday, and threatened legal action to protect the rates freeze for reserves.

“The Public Utilities Board’s decision to create a new First Nations on-reserve rate was an important step towards alleviating energy poverty,” Grand Chief Arlen Dumas said.

“At a time when Manitoba Hydro and governments are constantly talking about reconciliation, it’s unfortunate that they would try to overturn this important decision. AMC is calling on Hydro to withdraw its application to stay the PUB’s order, and is considering all of its legal options to protect the order.”

Hydro noted if the freeze goes ahead as ordered, all other residential customers would see their rates go up 4.04 per cent to reach the overall 3.6 per cent increase the board approved.

nick.martin@freepress.mb.ca