‘Performance degradation, diminished supply’ have Manitoba Hydro planning massive grid overhaul

This article was published by The Energy Mix on July 4, 2024.

Manitoba Hydro is looking ahead to a multi-billion-dollar overhaul of aging infrastructure that will represent a threat to grid performance until it’s brought up to date.

The system faces “accelerated system performance degradation and diminished supply” unless the Crown utility spends hundreds of millions of dollars per year to clear a looming infrastructure deficit, CBC reports.

Hydro’s report this week to the Manitoba Public Utilities Board cites an assessment of the province’s generating stations, transmission towers, and distribution lines that was first published in 2022, the news story states. It covers a network of mostly hydropower generating stations, the oldest of which date back to 1926, 1928, 1948, and 1952, as well as province’s transmission and distribution infrastructure.

All of those systems have “reached an age where overall condition has begun to degrade, and declining performance is apparent through common industry metrics,” the report warned.

“An increasing amount of degraded asset failures are occurring,” it added. “The impacts of the failures are growing due to factors that include obsolescence, leading to decreased availability of both spare parts and equipment knowledge and loss of system resilience.”

The report suggested an annual infrastructure investment target of $700 million. In its 2022-23 fiscal year, Hydro increased that spending from $27 to $531 million, communications director Scott Powell told CBC.

Like power utilities elsewhere, Manitoba Hydro is looking ahead to a rapid increase in electricity demand as the climate and energy transition takes hold.

“After taking more than a century to build its generating capacity to 6,100 megawatts, the growing demand for clean electricity led Hydro to announce last year it must double or even triple this generating capacity within the next 25 years,” CBC writes. “The pending capacity crunch has already led Hydro to warn it cannot provide electricity to every new high-intensity industrial customer that wants to connect to its power grid—and warn actual shortages are possible within five years.”

The utility is also wrestling with a debt that stood at $24.6 billion at the end of the 2022-23 fiscal year, producing $988 million in debt service charges.