Manitoba Hydro is reporting a consolidated net income of $114 million for the fiscal year ended March 31, 2015, down from $174 million in 2013-14.
In its annual report released today, the utility attributed the decrease in net income largely to increased financing expenses arising from additional long-term debt accumulated to finance capital expenditures.
“Manitoba Hydro is making the investments necessary to maintain the reliable supply of energy our customers depend on – replacing aging assets, addressing capacity constraints and developing new sources of electricity,” said Scott Thomson, President and CEO of Manitoba Hydro.
“We need to invest $17 billion over the next decade. Maintaining the corporation’s financial strength during this period, including ensuring we have adequate financial reserves, is critical to shielding our customers from sharp rate increases in the event of a prolonged drought or catastrophic outage. The recent approval of a 3.95 per cent rate increase for 2015/16 supports our balanced plan of protecting customers from rate shock while continuing to make the required investments to renew and expand our system to meet our customers needs.”
Manitoba Hydro’s consolidated net income was comprised of $104 million in the electricity sector and $10 million in the natural gas sector. Overall revenue was $2.05 billion, a decrease of $14 million or 0.7 per cent due to lower export electricity sales arising from a U.S. transmission line outage and lower market prices combined. This decrease was partially offset by higher domestic electricity revenues due to rate increases and customer growth.
The annual report also highlighted progress by Manitoba Hydro on projects to ensure an adequate supply of energy for the province.
Construction began on the new Keeyask Generating Station in July 2014 following extensive environmental and economic reviews. The project is a partnership among four First Nations – Tataskweyak Cree Nation, War Lake First Nation, Fox Lake Cree Nation and York Factory First Nation – and Manitoba Hydro. When completed in 2020 it will add 695-megawatts to the province’s supply of clean, renewable hydroelectricity.
The fiscal year also saw a number of significant milestones in the Bipole III Project, required to enhance the reliability of Manitoba Hydro’s electricity supply, including completion of site preparation for the Keewatinohk Converter Station and awarding of the contract for the design, supply and installation of high voltage direct current equipment at the project’s two converter stations.
All told, Manitoba Hydro invested nearly $2 billion in 2014-15 to build and maintain its energy system.
The report also noted finalization of a 25-megawatt power sale to SaskPower which, combined with a previous short-term sale, will be worth over $100 million to Manitoba Hydro. Export electricity contracts worth $9 billion have been signed by Manitoba Hydro, over $5 billion related to the Keeyask Generating Station.
