Manitoba Hydro and the Perils of Power

Hydroelectric power could be to Manitoba what oil is to Alberta except for one huge problem. The province's premier Crown Corporation has also been the province's premier political and ideological battleground for almost half a century.The chief protagonists are the two major parties, the New Democrats and the Progressive Conservatives. What's interesting about this 50-year-old standoff is that the protagonists tend to shift ideological positions depending on whether they are in – or out – of office.The party in power usually supports any and all growth and employment, Manitoba Hydro's dam-building plans being a prime illustration. After all, it's helpful to a government to be able to point to major economic activity.But just as routinely, the party in opposition attacks much, if not all, of the government's economic policies, particularly Manitoba Hydro's ongoing dam-building plans. After all too, it's helpful to an opposition to find and disparage any governmental missteps or bad judgements that can cost taxpayers billions of dollars.With a provincial election in the offing, the half-century-old battle has again been joined between the governing New Democrats under Premier Greg Selinger and the Official Opposition Progressive Conservatives under Brian Pallister.The ever-simmering political “war” is currently stoked almost to the boiling point thanks to the sharp  personal contrasts between Selinger, a mild-mannered social worker and graduate of the London School of Economics and Pallister, a self-made millionaire businessman and  fiscal and economic hawk who, as a cabinet minister under the last Progressive Conservative government of Premier Gary Filmon, pioneered a provincial law mandating public referendums before the imposition of any new or increased taxes.Not surprisingly, the editorial pages of the province's major newspaper, the Winnipeg Free Press, are  saturated with articles and letters featuring former senior Manitoba Hydro engineers and outside experts arguing fiercely over the advantages and disadvantages of power line routes and additional dam construction compared to a shale gas power plant.Despite Manitoba's long – and proud – history as “The Hydro Province”, a growing number of Manitobans are becoming alarmed. They fear the billion-dollar costs of the dams and the gigantic DC (direct current) transmission line for a province of just over one million people, built as much to earn U.S. export dollars as to service domestic power needs, will wreak havoc on their properties, livelihoods and the economy at large and empty their pocketbooks and the pocketbooks of their children and grandchildren into the foreseeable future.The mounting concern is creating public pressure for Hydro to do the unthinkable –  take a break from its storied hydro history and build the gas plant despite  the uncertainties of  the extremely volatile North American  shale gas market.Situated at the geographic centre of North America, Manitoba is the northern drainage basin for mid-continent North America. Not surprisingly, therefore, it is home to two of the biggest rivers in Canada – the storied Nelson River and the equally storied Churchill. Both were pivotal  in the fur trade. Both drain into Hudson Bay.Two separate quotes, uttered by two Manitoba premiers of different ideological persuasions decades apart, sum up the importance of Manitoba Hydro to the province's wealth and future.Here is former Progressive Conservative Premier Duff Roblin, addressing the Manitoba Legislature on the prospects of northern hydro development and exports on Feb. 15, 1966: “We can have our cake , we can eat it and we can make a bigger cake and sell part of that.”And thirty-five years later, here is former NDP Premier Gary Doer, now Canada's ambassador to the U.S., as quoted in the Winnipeg Free Press, May 6, 2001: “Alberta was the energy producer for the last 50 years; Manitoba can be the energy producer for the next 50 years. It's our ace in the hole.”Two provincial non-profit public interest groups, Manitoba Wildlands and Manitoba Energy, have co-operated to produce a paper, The Hydro Province: Manitoba's Hydroelectric Complex,  providing an excellent roadmap to Manitoba's on-again, off-again love/hate relationship with its premier environmental and economic asset – an asset that comes with a very high price both in terms of the environment and the economy.Because Manitoba's two largest rivers drain northeastward into Hudson's Bay, Manitoba Hydro decided to divert one, the Churchill, into the other, the Nelson, turning the two rivers into one giant river requiring only one set of dams.  Since 1976, due to a Manitoba Hydro dam at the eastern outlet of Southern Indian Lake, about 85 per cent of the Churchill River's flow now runs through the Rat and the Burntwood Rivers directly into the Nelson, augmenting its already-massive flow by about 40 per cent.As Manitoba Wildlands puts it: “Southern Indian Lake was turned into a holding tank, the Rat-Burntwood River system became a diversion route and the Nelson River was converted into a power corridor.”  The diversion, however, flooded 837 square kilometres (323 square miles) at Southern Indian Lake and along the diversion route. Average natural flows on the diversion route are roughly nine times greater than they would be in a state of nature.Manitoba Hydro's next big project was to turn Lake Winnipeg, the 10th largest freshwater lake in the world and the third largest in Canada, into a gigantic holding tank held back by the Jenpeg Dam. It stores the lake's water in the spring and summer and releases it in winter when energy demand peaks.The three major dams already built on the lower Nelson River - Limestone, Kettle Rapids and Long Spruce -  “are the points the system turns water flow into kilowatts,” states the paper. “These dams are like the drive train with CRD and LWR acting as the engine.”Manitoba Hydro's Nelson River Dams (including the initial dam at Grand Rapids where the Saskatchewan River flows into Lake Winnipeg) produce 3,925 megawatts. Several more are planned. The staggering costs of them plus the DC (direct current) transmission line, called Bipole Three, set to travel straight down through the middle of the province along the west side of Lake Winnipeg, are creating the current fierce debate.Manitoba Hydro  funds a significant portion of its capital requirements from cash generated by operations. But debt financing provides the majority of the funding necessary for investment in long term assets.On average, Manitoba Hydro derives close to 30% of its financing for capital assets from internal sources, Hydro's 2012-13 report states.“Manitoba also needs new sources of energy,” the utility's president, Scott Thomson, writes in the utility's 2012-13 annual report. “The demand for electricity in our province is continuing to grow and, at the current rate of approximately 80 megawatts of peak demand per year, it is projected that a new source of electricity will be needed by the 2022-23 fiscal year. To meet the future needs of the province, we are planning to build the 695-megawatt Keeyask Generating Station at an estimated cost of $6.2 billion followed by the 1,485-megawatt Conawapa Generating Station at an estimated cost of $10.2 billion.”As  concern and anger mount over the cost of Keeyask and Conawapa  - particularly the multi-billion-dollar Conawapa - and the potential for environmental and possible public health consequences from the massive Bipole Three high voltage transmission line marching from north to south through the middle of the province, the stage is set for a climactic showdown between Manitoba's two major parties in the provincial election slated for the spring of 2016.Frances Russell was born in Winnipeg and graduated from the University of Manitoba with a Bachelor of Arts degree in history and political science. A journalist since 1962, she has covered and commented on politics in Manitoba, Ontario, B.C. and Ottawa, working for The Winnipeg Tribune, United Press International, The Globe and Mail, The Vancouver Sun and The Winnipeg Free Press as well as freelanced for The Toronto Star, The Edmonton Journal, CBC Radio and TV and Time Magazine.She is the author of two award-winning books on Manitoba history: Mistehay Sakahegan – The Great Lake: The Beauty and the Treachery of Lake Winnipeg and The Canadian Crucible – Manitoba's Role in Canada's Great Divide. Both won the Manitoba Historical Society Award for popular history.She is married with one son and two grandsons and lives in Winnipeg.