Mild winter dries up Manitoba Hydro revenues

Manitoba's unusually mild and dry winter could result in higher electricity rates due to a lack of snow so far this season, according to Manitoba Hydro.

The province has seen about 48 centimetres of snow so far this year, well below the average of 75 centimetres.

That could be a problem for the public utility, as more snowfall means more water in the province's lakes and rivers, which is necessary to produce hydroelectricity.

"The quantity of electricity that we can produce is directly tied to the volume of water that's flowing through those lakes and rivers," Hydro spokesman Glenn Schneider told CBC News on Wednesday.

Schneider said the mild winter has also meant less electricity is being used, which combined with low water levels could mean Manitoba Hydro could see a lack of revenueand customers may have to payer higher rates down the line.

"If our revenues are as we currently see them being, it jeopardizes our financial position," he said.

"It makes us weaker financially, and what it means is we may have to ask for even higher increases in the years to come, going forward with the Public Utilties Board."

Hydro seeks extra 1% rate increase

Last summer, the Public Utilities Board said Manitoba Hydro could increase rates by only 1.9 per cent, which is one per cent below what the utility had asked for.

Hydro has filed a 27-page appeal to the board, asking it to add the additional one per cent to the rate increase in order to offset the potential losses.

If rates do not go up by that extra one per cent this year, Hydro's revenues will be reduced from $130 million to $65 million, Schneider said.

"Not fair. I don't think they should raise it just because of the level of rain or snow," said Daniel Walchuk, a Hydro customer in Winnipeg.

Will Navas, another customer, argued, "We don't really have control over the weather, so we shouldn't be punished just because it's nice out. If anything, we should be happy and just keep things the same."

Schneider said the only way to keep Manitoba Hydro's rates among the lowest in Canada is by raising rates gradually.

Farmers fear drought

Meanwhile, the dry winter could also hurt Manitoba's agricultural sector, since a lack of snow in the winter could potentially lead into a summer drought.

Daniel Bezte, a climate specialst for the Manitoba Co-operator agricultural newspaper, said there has been virtually no snow in the Red River Valley and southwestern regions so far this winter.

"I've been looking at these types of maps for about 12 years," he said. "Without going into a detailed look, I can't remember another year that's looked like thisat least, in my lifetime."

Bezte said the farmers he speaks with are getting worried about a possible drought if precipitation levels remain low this year.

Some farmers have even talked about the possibility of having to file both flood and drought claims in a year, he said.

"If you're living off the land and you rely on those rains, then it will be pretty important that we get either some snow or good timely rains," he said.

A drought would mean farmers losing money, which Bezte said could mean higher food prices for consumers.