The Black Rod

A perfect storm is hitting Manitoba Hydro. Insolvency is inevitable.  Eight months ago we reported that Hydro was on its deathbed, based on the testimony of the utility's own witnesses at a hearing of the Manitoba Public Utilities Board. http://blackrod.blogspot.ca/2017/08/manitoba-hydro-is-on-its-deathbed-there.html Since then the patient's condition has deteriorated rapidly. It's time to call the family to pay their last respects.  Last week the Bank of Canada announced that the years of low interest rates are officially over. The Bank raised the bank rate by one quarter of one percent. It was the third rate hike within a year.  It's just the start. The Bank of Canada expects at least one and possibly two more rate hikes in 2018.  That will bring the bank rate to about half of where the Bank wants it to be.  You read that right---half.  The Bank of Canada wants the bank rate to steady out at 2.5 percent, the lower end of a range the Bank feels is right...

Manitoba Hydro is on its deathbed. Oh, you won't find anyone official to say it. Yet . Like relatives trying to appear cheery and optimistic around a loved one that's been diagnosed with terminal cancer, the people in power are in the first stage of grief -- denial. The prognosis for Hydro was delivered three weeks ago at hearings before the Public Utilities Board where the utility was seeking punishingly higher rates for customers in Manitoba. It took us this long to read through the hundred-plus pages of transcript, to decipher the coded language of the witnesses, to interpret what they were getting at, and, finally, to understand the terrible conclusion.  We couldn't believe it, just as, we're sure, you can't--- so we did it all again, to get a second opinion, so to speak.  Hydro conceded to the PUB that it undertook a massive expansion program--- involving three (it was once four) new dams and two new major powerlines (one in the United States)---whi...

We appreciate the emails from concerned readers who have asked, where have we been?  Working diligently on Project X. Thank you for your tips. It took the train wreck known as Manitoba Hydro to get us to set things aside and get back into the arena. Manitoba Hydro has applied to the Public Utilities Board for another hike in rates. This year they're asking for a rates to go up 3.95 percent. Something about that number seemed odd. But what? It didn't take long to answer the question with a clipping from a Canadian Press story posted two-and-a-half years ago. "Manitoba Hydro's CEO says customers can expect rate increases of about 3.5 per cent a year for the foreseeable future as the Crown-owned utility builds new generating stations while export prices are soft."  ( CP, Sept. 19, 2012 ) So Hydro's minimum rate hike has climbed by almost half a percent a year.  And that's  after the plan to build Manitoba's biggest generatin...