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WINNIPEG —ÌýThe head of Manitoba Hydro says the Crown-owned utility is facing dry conditions and low water levels as it aims to expand generating capacity and replace aging infrastructure.Ìý

Hydro president and chief executive officer AllanÌýDanrothÌýtold a legislature committee the utility has faced severe drought in three of the last four years, which leaves less water to generate electricity and reduces export sales.Ìý

The utility posted aÌýconsolidatedÌýnet loss of $63 million in the last fiscal year and is forecasting a loss of $464 million in the current one, which ends in March.Ìý

The red ink comes at a time when Manitoba Hydro is on a multi-year, $7-billion plan to replace and upgrade aging transmission systems.Ìý

It is also looking for more power generation so that it can continue to meet peak demand timesÌýintoÌýthe next decade.Ìý

DanrothÌýtold the committee plans areÌýproceedingÌýto buy 600 megawatts of power from new wind farms, which are to be majorityÌýIndigenous-owned.Ìý

“We are moving very aggressively through a timeline, actually much more aggressive than a lot of our other jurisdictions,”ÌýDanrothÌýsaid.Ìý

“But nevertheless, we just want to try to get the first…one, two, three installations out of the way beforeÌýcommitting toÌýanything further.”Ìý

The utility put out a call for qualified potential suppliers in the fall and isÌýfinalizingÌýthat list,ÌýDanrothÌýsaid. A first request for proposals from those on the approved list is expected in March, with further opportunities in future years. The utility is also planning to buildÌýnewÌýgenerating capacity of its own in western Manitoba.Ìý

Hydro faced a sharp rise in debt over a decade ago as a new transmission line and generating station ran well over budget. Consecutive years of financial losses haveÌýaddedÌýto the red ink. About 30 per cent of annual revenuesÌýgoesÌýto servicingÌýthe utility’s $25.3-billion debt,ÌýDanrothÌýtold the committee.Ìý

Hydro is also facing the cost of upgrading its major technology platform that could total $193 million, documents filed with the Public Utilities Board show. The current system is less than two years away from no longer being supported by the manufacturer.Ìý

“It’s at its end of life,”ÌýDanrothÌýsaidÌý

To help boost revenues, Hydro applied to the Public Utilities Board, the provincial regulator, for annual rate increases of 3.5 per cent for three consecutive years. The board approved a four per cent hike as of Jan. 1 but has yet to set rates for the following two years.Ìý

Hydro has also floated the idea of charging residentialÌýcustomersÌýdifferent rates atÌýdifferent timesÌýof day, to try to persuade people to shift some of their energy use away from times when demand peaks. The idea, used in some areas of Ontario, can reduce maximum energyÌýdemandÌýand delay the need to build new generating capacity.Ìý

Hydro had a public-opinion poll on the issue lastÌýyearÌýand more than half the respondents said they would consider adjusting when they run a dishwasher, do laundry or charge an electric vehicle.Ìý

DanrothÌýsaidÌýthere’sÌýno imminent move to time-of-use rates. It would require newÌýtechnologyÌýand any change would be discussed with theÌýutility’sÌýboard and the provincial government, Danforth said.Ìý

“That poll…was really justÌýto try to understand what our customers were thinking more than anything,” he said.

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