The Manitoba Public Utilities Board has denied the request of Manitoba Hydro for a rate increase.
Among the reasons given is a concern by the board that the risk of future export revenues and earning is more uncertain today than in the past.
One solution that needs to be looked at is structurally separating the export business of Manitoba Hydro from the provincial electrical and gas utility business. Manitoba customers of Hydro should not be placed at risk of a rate increase to pay for risky business decisions made by the export business unit.
In an ideal world, the export business unit should also be required to raise its capital financing from the private markets instead of relying on the credit rating of the overall government of Manitoba. As a tax payer, I do not want to be backstopping Manitoba Hydro’s risk adventures in the capital-intensive, export business.
It is time to place a firewall around the export business unit of Manitoba Hydro to protect rate payers and tax payers of Manitoba.