The NDP Would be Smart to Press Pause

Blog, Energy, Peter Holle

Good to see that common sense may be seeping into the Manitoba NDP Government’s

Proposed Keeyask Dam

ambitious plan to spend over 15 billion dollars constructing several new hydro dams in Northern Manitoba, as revealed in this Winnipeg Free Press report.

The grand plans were put together when the price of power was much higher southwards in the neighbouring export markets of the U.S. mid-west.   But markets change and the price of power in Minnesota and Wisconsin has plunged due to a combination of slower economic growth and, more importantly, the shale gas revolution which has sharply reduced the cost of natural gas.

Frontier first broke the story in August in this commentary by Research Fellow Tom Adams  which turned out to one of the most popular items on Winnipeg Free Press website during the summer.

As Tom highlights, the risk of continuing to spend billions on dams for which the market has effectively disappeared will eventually erode the one undisputed area where Manitoba has some natural strength – efficient and economical hydro power.    As the high cost projects are added into the cost base the prices for power for all Manitobans will start spiking upwards.

Hopefully, the NDP will do the smart thing on this file.

Press pause.