In late January, Manitoba Hydro CEO Jay Grewal said the utility would need new sources of electricity within five or six years. She reiterated a plan to meet new demand by contracting with private electricity producers.

Grewal told the Manitoba Chambers of Commerce that new capacity would be from wind power because, “It is the lowest possible cost and we can optimise the wind with our system.”

Twenty-four hours later, Adrien Sala, the NDP minister responsible for the province’s utility, disavowed Grewal’s commitment to private power. He said that new generating capacity should be publicly owned.

The NDP government of Wab Kinew fired Manitoba Hydro’s CEO two weeks later.

Like British Columbia, Manitoba Hydro is perfectly positioned to add wind power to the provincial grid. Nearly all the electrical energy used in Manitoba is generated at the utility’s fifteen hydroelectric generating stations.

Like grid-scale batteries, hydropower reservoirs are mass energy storage systems, able to feed generators when needed, and conserve potential energy when wind power is available.

Unlike British Columbia’s NDP government, the five-month-old administration of Wab Kinew appears to believe there is little reason for private power producers to be guaranteed profits that could benefit the province’s consumers.

Supporters of private energy production argue that the government should not increase long-term debt to add publicly owned generating capacity. Yet, they are happy for the government to guarantee long-term contractual obligations that require streams of regular payments just like conventional debt.

A website of the International Monetary Fund described a situation in Zambia where “hidden debt” imposed burdens on the public and guaranteed private sector profits. As in British Columbia, power contract transparency did not exist.

Power purchase agreements (PPAs), long-term agreements between utility off takers and private power producers to buy electricity, are the core contracts that allow solar farms, hydroelectric dams, or thermal plants to secure financing.

PPAs usually come with a sovereign guarantee. …But when the utility does not pay, its obligations are assumed by the government and added to the nation’s outstanding debt. Further, when PPAs are later canceled or renegotiated, the government must make payments to investors.

Thus, even though PPAs are a form of potential public debt, their terms are rarely disclosed.

IMF: The Other Hidden Debt

Greta Moran, a New York journalist focusing on public health and the climate crisis, explained in 2019 why some believe that publicly owned power sources are more important than ever.

Earlier this month, Pacific Gas & Electric, the investor-owned utility company that supplies power to much of California, cut off electricity to over 700,000 customers. The company argued that such a drastic measure — the largest planned power outage in the state’s history — was necessary to prevent wildfires.

Yet for some activists, this bleakly framed choice served as another reminder that investor-owned utility companies are not positioned to manage our energy futures, especially as climate change raises the stakes.

In recent years, activists around the country, including in New York City, Boston, Providence, Chicago, Boulder, and Washington, D.C., as well as Northern California and Maine, have been working to transition utilities to public ownership, which would make them accountable to the public instead of investors…

Publicly Owned Utilities Could Help Fight the Climate Crisis