Bipole III moving forward

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This article was published 22/09/2016 (3309 days ago), so information in it may no longer be current.

The Manitoba Hydro board of directors say they have no choice but to move forward with the Bipole III project, a source of controversy in the Southeast for many years.

On Wednesday, the recently appointed board issued the results of a review conducted at the request of the Progressive Conservative government.

The review, which began in May, included a mandate to assess Manitoba Hydro’s current financial situation and determine whether the Bipole III project should proceed as planned, be delayed, rerouted or cancelled, due to said financial situation.

Hydro Keeyask Generating Station, its capital program and the corporation’s financial situation and operation were also part of the review.

The review showed 95 percent of the contracts for the construction of Bipole III are in place, with $2.9 billion of project funding having been committed or expended to date. In addition, the review found that rerouting the line down the east side of Lake Winnipeg is no longer an option and any delay or cancellation of Bipole III would make it impossible to carry the required power from the Keeyask Generating Station to deliver to export contracts.

Canceling Bipole III now would cost Manitoba ratepayers over $7 billion.

While board chair Sanford Riley noted in a release that Bipole III “is essential to reducing the significant risk of blackouts and service disruptions should there be a failure of the existing Bipole I and Bipole II transmission lines,” he was critical of the way the new line was developed.

“Rerouting the Bipole III transmission line down the west side of the province was obviously a wrong decision—one forced on Hydro by the previous government, and has cost Manitobans an additional $900 million. However, the review concluded that if construction is not completed, Keeyask’s export contracts will not be filled, making the new generating station an asset incapable of generating revenues for many years. The Board has been left with no choice but to move forward,” he said.

Riley said the review outlined a number of additional challenges. Neither Bipole III nor Keeyask are on track to meet their target completion dates, with Manitoba Hydro now projecting delays of between 12 and 15 months for Bipole III and between 21 and 31 months for Keeyask.

The cost for Bipole III is also expected to rise from $4.65 billion to between $4.9 and $5 billion. Keeyask is expected to rise from $6.5 billion to between $7.2 and $7.8 billion. Manitoba Hydro’s debt is also expected to grow from its current level of $13 billion to $25 billion within the next three to four years.