Manitoba Hydro (Hydro), and more specifically the issue of where to route Bipole III, is likely to be one of the major issues in the upcoming 2011 Manitoba General Election. It is unfortunate this binary “east side” vs. “west side” has dominated the public discourse, because the larger questions about how we use, produce, distribute, and sell energy within and beyond Manitoba remain largely unasked.
Hydro's $8.5 billion debt is the single largest debt obligation of Manitoba – accounting for just under 37% of provincial debt obligations. To be fair Hydro is at present successfully managing its debt, but the taxpayers of Manitoba will be on the hook if Hydro failed to meet debt obligations. Over the next decade this debt could easily soar above $20 billion as Hydro anticipates spending an additional $18 billion, largely on the construction of new dams in Manitoba's North.
Hydro already produces enough electricity for Manitoba's needs – although we do at times import fossil fuel based energy. This means that new energy sources are largely being developed in Manitoba for the purpose of increasing electrical exports. Now this is not necessarily a bad thing, but this does mean that we as Manitoba taxpayers bear the risk if these export markets become unprofitable for whatever reason.
By far the cheapest way to free up more energy for export – or to prevent the need to import dirty energy – is to use energy more efficiently. Manitoba's per capita consumption of electricity is among the highest in the World! For all the NDP and Hydro rhetoric about getting an A+ in energy efficiency, if you look at Hydro's financial returns you can see that for the most part energy demand per customer (for both elecctricity and natural gas) has remained more or less stable in Manitoba over the past ten years. So what exactly did we get the A+ for?
On January 10, 2010 the Manitoba Government announced that the St. Joseph Wind Farm (St. Joseph) was operational. The 138 megawatt (MW) wind farm was built in ten months at a cost of of $345 million ($260 million in financing was provided by Hydro which will be repaid in energy).
A comparison of St. Joseph with the $1.6 billion 200MW Wuskwatim dam reveals that that wind-generation is cheaper than hydro-electric energy. Yes it is true that Hydro operates at an average efficiency of 65-75%, while wind operates at an average efficiency of 40%. But even after this is taken into account St. Joseph cost $6.25 million per megawatt (MW) of average deliverable capacity – only costing to Hydro $4.7 million per MW – whereas in contrast Wuskwatim cost $10.666 million per MW of average deliverable capacity.
Now granted there is also a need to create the infrastructure to connect the wind energy to the grid, and wind energy has intermittency issues. There is however also lower transmission losses when the energy is produced in Southern Manitoba, which is both closer to export markets and where most energy is consumed in Manitoba, rather than hydro dams located in Manitoba's North.
Manitobans are smart innovative people! We are constrined not by the technological capacity of better energy efficiency, or the feasibility of non-fossil fuel based alternative energy such as wind and solar, but by the limits of our own creativity. It starts with having an open, honest, and frank public discourse about energy. The point here isn't to provide all the answers, but to point out that a more thorough debate on energy use, production, and distribution is drastically needed in Manitoba.
Unfortunately this debate is impeded by the political rhetoric, and energy myths propagated by Manitoba's three other political parties.
James Beddome, Leader
Green Party of Manitoba
Wuskwatim - $1,600 million/(200MW *75%) = $10.666 million/MW
St. Joseph - $345 million/(138MW * 40%)= $6.25 million/MW
(When the $95 million Pattern Energy contribution is added into the equation the cost to Hydro for St. Joseph reduces to $4.7 million per MW)