Minister Wharton makes statement on review of 695-MW Keeyask hydro, Bipole III

Photo courtesy Manitoba Hydro.

Canadian Crown Services Minister Jeff Wharton issued a statement last week regarding the government’s receipt of an Economic Review of the 695-MW Keeyask hydro project and associated Bipole III transmission line, completed by Commissioner Brad Wall on behalf of the government of Manitoba, Canada.

Keeyask is a hydroelectric project on the Nelson River that began operating in February 2021. Construction of the station began in 2014 and the first unit entered service six months ahead of schedule. At that time, Crown provincial utility Manitoba Hydro said Keeyask was tracking to meet its control budget of $8.7 billion. Bipole III is a high-voltage direct current transmission line built to deliver renewable energy from Keeyask and other new northern generation projects to southern Manitoba, and to support export sales. It was completed in July 2018. Wall said that “even though Bipole III was critical to enabling the building of Keeyask, the former Government opposed a review of them together.”

Wall’s report said “the Commission inquired into the extent to which Manitoba Hydro pursued the Keeyask and Bipole III projects when they were not necessary, or not necessary at the time, to meet the Province’s then‑anticipated electrical needs in a timely and cost‑effective manner.”

Construction of the two projects was “billions of dollars over budget, an economic burden that is placed squarely on the shoulders of Manitobans to bear,” according to Wharton’s statement. Wharton said the government commissioned this economic review to determine why the projects were continued despite “the economic and environmental evidence against them, and to seek recommendations on how we can ensure such an unprecedented situation can never be repeated.”

The statement, released last week, said in part:

“This economic review demonstrates the former government sought to actively dismiss and ignore concerns regarding the need for the Keeyask generating station and the routing of the Bipole III transmission line. The review also confirms the former government directly interfered to ensure that these projects would conform to their preferences, rather than economic considerations and the clear recommendations of utility and environmental experts. In addition, the review finds that, once the projects were underway, proper government oversight was not in place, which allowed project costs to escalate by billions of dollars with no recourse.

“The findings of the Economic Review on Bipole III and Keeyask confirm what Manitobans have long-suspected: the former government interfered in the development of these projects and that, as a result, Manitobans have been left with a massive debt burden as the owners of Manitoba Hydro.

Manitobans need to be able to hold Manitoba Hydro and the projects they undertake to account. This review confirms that Manitobans were deliberately left in the dark regarding Bipole III and Keeyask, and provides clear recommendations to ensure this can never happen again. Our government has already taken steps toward this with the introduction of bill 35, the public utilities and ratepayer protection act, which would ensure all current and future operations of our publicly owned Manitoba Hydro are transparent and fully accountable to Manitobans.

“Our government will review the findings and recommendations in full, and will continue to take actions to enact clear and transparent policies that ensure any future projects are both accountable and demonstrate value to Manitobans.”

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