Manitoba Hydro

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Manitoba Hydro
Type of Company Crown Corporation
Founded Winnipeg, Manitoba (1961)
Headquarters Winnipeg, Manitoba, Canada
Key people Robert B. Brennan, President & CEO
Industry Electricity generation Natural gas distribution [1]
Products Electricity, Natural gas
Revenue $2.017 billion CAD (FY 2005)
Net income $136 million CAD (FY 2005)
Employees 5300 (FY2003)
Website www.hydro.mb.ca

Founded in 1961, Manitoba Hydro is the electric power and natural gas utility in the province of Manitoba, and is the 4th largest electrical utility in Canada. It is a provincial Crown Corporation, governed by the Manitoba Hydro-Electric Board and the Manitoba Hydro Act H190 CCSM. Today the company operates 15 interconnected generating stations. It has more than 500,000 electric power customers and more than 250,000 natural gas customers. Since most of the electrical energy is provided by hydroelectric power, the utility has low and stable electricity rates. Stations in Northern Manitoba are connected by a HVDC system, the Nelson River Bipole, to customers in the south.

Contents

[edit] Abbreviated history

[edit] 1873-1960: electric power before Manitoba Hydro

The first recorded attempt to extract useful work from a Manitoba river was in 1829 at a flour mill (known as Grant's Mill) located on Sturgeon Creek in what is now Winnipeg. This was not successful and the milling equipment was later operated by a windmill.

The first public electric lighting installation in Manitoba was demonstrated at the Davis House hotel on Main Street, Winnipeg, March 12, 1873. In 1880, the Manitoba Electric and Gas Light Company was incorporated to provide public lighting and power, and a year later absorbed the Winnipeg Gas Company. In 1893, the Winnipeg Electric Street Railway Company was formed, and initially purchased power from Manitoba Electric and Gas, but by 1898, it had built its own 1000-horsepower (750 kW) generating plant and purchased Manitoba Electric and Gas.

The first hydroelectric plant in Manitoba operated near Minnedosa north of Brandon from 1900 to 1924. A 261-foot (80 m) earth-fill dam was constructed across the Minnedosa River (now known as the Little Saskatchewan River) by private investors. The plant only operated part of the year, with the load carried in the winter months by steam generators. An 11-kV wood-pole transmission line connected the station with the town of Brandon, Manitoba. The remains of the dam are still visible.

By 1906, Winnipeg Electric Street Railway had constructed a hydroelectric plant on the Winnipeg River near Pinawa, and seventy miles (100 km) of 60-kV transmission line. This plant operated year-round until 1951, when it was shut down to allow improved water flow to other Winnipeg River stations. Its remains are still preserved as a Provincial park [2].

Since the investor-owned Winnipeg Electric Street Railway was charging twenty cents per kilowatt-hour, the City of Winnipeg founded its own utility in 1906, and developed a generating station at Pointe du Bois on the Winnipeg River (which still operates in 2005). In reaction to this, Winnipeg Electric Street Railway dropped prices to ten cents per kilowatt-hour, but the City-owned utility (Winnipeg Hydro) set a price of 3.5 cents per kilowatt-hour which held for many decades.

In 1916, the Province established the Manitoba Power Commission with the object of bringing electric power to communities outside of Winnipeg.

Pointe du Bois Generating Station on the Winnipeg River
Enlarge
Pointe du Bois Generating Station on the Winnipeg River

Winnipeg Hydro, Winnipeg Electric Street Railway Company and the Manitoba Hydro Commission all built extensive hydroelectric generating facilities on the Winnipeg River during the period 1916 through 1928. The Great Depression starting in 1929 put an end to rapid growth until after World War II. The City of Winnipeg utility also built coal-fired steam generators in 1924 on Amy Street. The steam boilers at Amy Street were also used for district heating. During World War Two, electric boilers at Amy Street used surplus hydroelectric power to economize on coal consumption. The City utility also implemented load management on electric water heaters, which allowed them to be turned off during the day and during peak load periods.

A new utility was set up by the Province in 1949, the Manitoba Hydro Electric Board. It acquired the assets of the Winnipeg Electric Street Railway in 1953. The MHEB was tasked with bringing electric power to the rural parts of Manitoba, a task which took until around 1956 to substantially complete.

By 1955 there were three utilities in the province:

  • Manitoba Power Commission (Provincial Government)
  • Manitoba Hydro Electric Board (Provincial Government)
  • Winnipeg Hydro Electric System (City of Winnipeg government).

Two thermal (coal-fired) stations were built at Brandon and Selkirk starting in 1958. These units were intended to operate during low-water years, and burned lignite coal.

In 1957, the first transmission line between Manitoba and North-West Ontario was installed. In 1960, a 138-kV connection to Saskatchewan Power Corporation was completed, and it was later uprated to 230 kV.

[edit] 1961 to date: the Manitoba Hydro era

The Manitoba Power Commission and Manitoba Hydro Electric Board merged in 1961 to form Manitoba Hydro. The last of the private mine-owned utility systems at Flin Flon was purchased by Manitoba Hydro in 1973. The early 1970s also marked the installation of tie lines between Manitoba Hydro and utilities in Ontario, Saskatchewan and Minnesota. The interconnection with the American utilities (Otter Tail Power, Northern States Power, and Minkota Power Co-Operative) were used to obtain firm power of 90 MW for the winter of 1970; and since that time these interconnections have also been used for export of energy.

In the period 1974 to 1976, Manitoba Hydro was still studying nuclear power, but it concluded that all hydraulic resources should be developed first before construction of any nuclear facility. Although two research nuclear reactors existed at the Pinawa AECL research facility, no nuclear generating capacity has ever been constructed in Manitoba.

In July 1999, Manitoba Hydro purchased the natural gas distribution company Centra Gas Manitoba. On September 3, 2003 Manitoba Hydro purchased Winnipeg Hydro, which formerly provided electric power in the downtown area of Winnipeg.

[edit] Nelson River development

Main article: Nelson River Hydroelectric Project

Between 1955 and 1960, studies were carried out to determine what resources would be available for future hydraulic generation. The stations at Kelsey, Kettle, Long Spruce and Limestone were built on the lower Nelson River to support both Manitoba load growth and export plans. Limestone, the largest generating station in Manitoba, is located on the Lower Nelson only 90 km from Hudson Bay. Long-term firm power sales contracts were signed with Northern States Power of Minneapolis. Control dams have turned Lake Winnipeg, the 12th largest lake in the world, into a 25,000 km² reservoir for the Nelson River generation system.

The great distance between generating sites on the Nelson River and load centers in southern Manitoba required the use of HVDC transmission lines to bring the energy to market. When these lines were commissioned they were the longest and highest-voltage direct current lines in the world. The Dorsey converter station is 26 km north-west of the center of Winnipeg.

[edit] Wind development

In 2005, a wind farm is under construction near St. Leon, Manitoba. Power generated by this privately constructed plant will be purchased by Manitoba Hydro for distribution on its network. The capacity of this installation is 99.9 MW, comprising 63 wind turbines of 1.65 MW each. This is the first privately owned grid-connected generation to be constructed in Manitoba in nearly fifty years. Energy produced by this facility will be subsidized by the Canadian Government's Wind Power Production Incentive, though over the life of the project tax revenue will exceed the value of the initial subsidy. Six other potential wind projects in Manitoba are registered under this program, with in-service dates ranging up to 2008. The Manitoba OASIS node has generator interconnection evaluation studies for 50 and 99 MW wind farms at Elie and Lena, and 25 to 100 MW wind farms at Darlingford, Boissevain, Killarney, and Minnedosa. Additional probable wind farm sites of up to 200 MW are in the generation queue on the OASIS for St. Leon, St. Laurent, Letellier, Waskada, Alexander, Lizard Lake, and other locations.[3]

Schneider Power Inc., a private wind power developer, is planning 3 wind power projects for Manitoba. Projects SPI09X and SPI10X each are planned to have 27 turbines and a capacity of 40.5 MW, with expected inservice dates of September 2006. Project SPI11X (99 MW) has an inservice date of September 2007.[4]

[edit] Generating stations

Station Started Location Units Power
per unit
(MW)		 Total power (MW) Average
annual
generation
(TW·h)		 Remarks
Pointe du Bois 1911 Winnipeg R. 16 various 78 0.6 Ex–Winnipeg Hydro, 8.4 MW Straflo installed 1999, 14 m head
Great Falls 1922 Winnipeg R. 6 various 131 0.75 Ex–Winnipeg Electric Railway Co., 17.7 m head, 883 m³/s each unit
Seven Sisters 1931 Winnipeg R. 6  ? 165 0.99 18.6 m head, 1,146 m³/s [5]
Slave Falls 1931 Winnipeg R. 8 8 67 0.52 Ex–Winnipeg Hydro
Laurie River 1 1952 Laurie R. 1 5 5 0.03 Ex–Sherrit Gordon, 16.8 m head
Pine Falls 1952 Winnipeg R. 6 14 82 0.62 11.3 m head, 917 m³/s
McArthur Falls 1954 Winnipeg R. 8 7 56 0.38 7 m head, 966 m³/s
Kelsey 1957 Nelson R. 7 30 211 1.8 Ex-INCO, 17.1 m head, station 1,713 m³/s [6]
Laurie River 2 1958 Laurie R. 2 2.5 5 0.03 As for LR 1
Brandon (steam) 1958 Brandon 1 95 95 0.6* Unit 5, sub-bituminous coal
Selkirk (steam) 1958 Selkirk 2 60 121 0.3 Natural gas since 2002
Grand Rapids 1965 Saskatchewan R. 4 120 472 1.54 First station built under Manitoba Hydro name, frequency control for Manitoba, 36.6 m head, 1500 m³/s per unit [7]
Kettle 1970 Nelson R. 12 103 1,228 7.1 30 m head, 370 m³/s each unit [8]
Long Spruce 1977 Nelson R. 10 100 1,010 5.8 26 m head, 4,580 m³/s [9]
Jenpeg 1979 Nelson R. 6 16 97 0.9 USSR Bulb Turbines [10]
Limestone 1990 Nelson R. 10 135 1,340 7.7 5,100 m³/s total [11]
Brandon (combustion turbine) 2002 Brandon 2 130 260 0.05* Units 6 & 7, natural gas/diesel backup simple cycle
Diesel Plants - Brochet, Lac Brochet,
Tadoule Lake, Shamattawa		 12 various 4 0.01 Diesel fuel, not on grid

* Typical peaking only

Generating station total ratings are approximate. Water flow conditions and station service load may account for some of the difference between rated station output and total unit nameplate rating. In a typical year the hydroelectric plants produce more than ninety-five percent of the energy sold.

Seven Sisters GS from the downstream side
Enlarge
Seven Sisters GS from the downstream side

[edit] Transmission

[edit] AC system

Manitoba Hydro operates an extensive network of more than 9000 km of ac transmission lines. Transmission voltages in use include:

  • 66 kV
  • 115 kV
  • 138 kV
  • 230 kV
  • 500 kV

Distribution voltages include 4160 V especially in urban Winnipeg, 12.47 kV and 25 kV, usually on overhead conductors but often in buried cables. Total length of distribution lines is over 80,000 km.

Transmission lines built in Manitoba must withstand a wide temperature range, ice, and occasional high winds. In 1997, a tornado blew down 19 transmission towers of the HVDC system north of Winnipeg, reducing transmission capacity from the North to a small fraction of system capacity. During the several days required for utility employees to repair this line, power was imported from the United States over the 500 kV interconnection. As a consequence, though some major industrial customers were requested to curtail energy use, disruption for most customers remained small.

[edit] DC system

A large portion of the energy generated on the Nelson river is transmitted south on the HVDC Nelson River Bipole system. The two transmission lines, each nearly 900 km long, operate at +/- 450 kV and +/- 500 kV DC, with converter stations at Gillam and Sundance, and the receiving terminal near Rosser. The combined capacity of the two HVDC lines is 3420 MW, or about 68% of the total generation capacity in the province.

[edit] Exports

Manitoba Hydro has transmission lines connecting with Saskatchewan, Ontario, North Dakota and Minnesota. Ties to the Canadian provinces are of low capacity but a substantial portion of Manitoba Hydro's annual generation can be exported over the tie to Minnesota. In 2003, a new line was completed to the United States, allowing a firm import capacity of 700 megawatts. In 2005 Manitoba Hydro announced increased interchange up to 500 MW with Ontario, after construction of additional transmission facilities.

Manitoba Hydro also participates in "border accommodation" transfers, where it provides power to isolated extra-provincial end-use loads such as those of the Northwest Angle in Minnesota.

Manitoba Hydro is a member of the MRO (Midwest Reliability Organization), a region of the North American Electrical Reliability Council NERC and successor to MAPP (Mid-continent Area Power Pool) since June 15, 2004. Manitoba Hydro continues its membership in MAPP, which retains its function as a generation reserves sharing pool.

Export of electrical energy has been regulated since 1907 in Canada. Since 1959, the National Energy Board licences exports, based on the criteria that the exports are surplus to domestic need and that the price charged is reasonable and in the Canadian public interest. Similarly, exporters of power from the United States into Canada require a United States Export Authorization.

[edit] Natural gas customers

Manitoba Hydro has about 239,000 residential, 16,000 commercial and 400 large industrial customers. In fiscal 2003 total gas revenues were $497 million CAD on 2,123 million cubic metres of gas. Residential consumers account for about 42% of Manitoba gas consumption.

[edit] Recent and current projects

Manitoba Hydro has a capital spending program intended to maintain and extend capacity for Manitoba customers, for environmental protection, and to allow export of energy surplus to Manitoba needs to stabilize rates. Some of these projects include:

  • Power Smart: Manitoba Hydro has operated a Power Smart program since 1991. This project identifies energy conservation and efficiency opportunities for residential, commercial and industrial customers. Measures such as high-efficiency electric motors and improved lighting have offset 292 MW of peak load growth and up to 631 million kW·h per year of energy consumption. In 2005 Manitoba Hydro announced goals of doubling Power Smart capacity savings to 842 MW and 2.6 terawatt-hours by 2018.
  • INROCS (Interlake Nelson River Optical Cable System is the replacment of the former microwave links for control of northern generation and transmission with a buried fiber optic cable system. More than 1140 km of cable were buried between the system control center in Winnipeg, to the present northern-most stations near Gillam.
  • Brandon Combustion Turbines: In 2003, Manitoba Hydro commissioned two simple-cycle gas turbine generating units at the existing plant in Brandon. These natural gas-fuelled units are intended to provide peaking power and supplemental capacity in case of low water levels.
  • Selkirk Natural Gas Conversion: In 2003, the fuel supply of the Selkirk steam boilers was converted to natural gas. While this is a more expensive fuel than the coal previously used at this plant, it allows the life of the station to be extended without the capital cost required to clean coal emissions up to current standards.
  • Wind Energy Survey: While Manitoba Hydro is in the process of completing a wind energy survey at five locations, private developers have initiated a wind farm at St. Leon. Manitoba Hydro has not announced an in-service date for additional utility-owned wind generation.
  • Wuskwatim Project: Manitoba Hydro has started road construction for the Wuskwatim generating station, to be built on the Burntwood River near Thompson. This 200 MW station will have three hydraulic turbine generator units and will have only a small reservoir. This project had the most extensive environmental review of any generating project in Manitoba. Participation of the Nisichawayasihk Cree Nation (NCN) aboriginal community has been passed by a June 2006 referendum by NCN members. This partership between NCN and Manitoba Hydro will allow advancement of the in-service date to 2012 and opportunities for additional export revenue. Otherwise the load growth would not require this new capacity until several years later.
  • New Hydraulic Generation (Gull, Conawapa, Notigi) and HVDC Transmission (Bipole III): Studies are continuing to permit eventual construction of new generating projects along the Nelson River. The Gull (now known as Keeyask) station will have a capacity of approximately 630 megawatts and planning studies are continuing. Projected first power date is in 2012, but no final design or construction decisions have been made. The 1380 megawatt Conawapa project was initiated but postponed indefinitely in 1992 when Ontario Hydro elected not to purchase firm energy from Manitoba. Planning activities now underway are intended to allow for an in-service date of 2017, but no construction commitment has been made and no environmental hearings are currently scheduled. The in-service date would be after that for Wuskwatim and Gull. The station at Notigi would be rated approximately 100 megawatts, but no in-service date has been set for this project.

More than 5000 MW of hydroelectric potential could be developed in Manitoba, which includes 1380 MW at the Conawapa site, 630 MW at the Gull (Keeyask) site, and 1000 MW at the Gillam Island site, all on the lower Nelson river. Other sites have been assessed but are not currently under study for development. All of these developments would require a large increase in electric power exports, since Manitoba load growth will not require this capacity for a generation or more. All of these projects require additional HVDC transmission capacity from the North to the South. One such project, Bipole III, has been discussed with communities on the east side of Lake Winnipeg, but this area is ecologically and culturally sensitive and power line construction will require extensive environmental impact assessment.

[edit] Controversies and issues

Like any other large-scale activity, the operations of Manitoba Hydro have not been without controversy.

  • In 1976, the Churchill River diversion project was set into operation. Flow was diverted by a series of channels and control structures into the Nelson River. The effects of this diversion on pre-existing water levels and the indigenous Cree and Métis people continue to be felt to this day. Negotiations between the affected Northern communities and Manitoba Hydro continue, to discuss mitigation measures and compensation for loss of traditional resource areas and sites.
  • The water level of Lake Winnipeg is now regulated by Manitoba Hydro as part of the energy generation operations. Some property owners on the southern edge of the lake feel that the levels are now maintained at a higher average level than would be natural, and attribute erosion of their property to the lake level. Manitoba Hydro has pointed out that the regulation project also allows lake level to be lowered, such as during the 1997 floods, thereby preventing significant property damage.
  • Residents of the area around the Selkirk steam plant attributed various environmental damage to the continued operation of this plant, which at the time was fuelled by coal. Manitoba Hydro has converted this plant to natural gas, which, while a more expensive and faster-depleting energy source than coal, burns with lower emissions of heavy metals, sulfur dioxide, and carbon dioxide.
  • The Province of Manitoba charges Manitoba Hydro a water rental fee proportionate to the total volume of water passed through the generating stations. Increases in this rental have provided an important stream of non-tax revenue to the Provincial government. As well, since 2002 the New Democratic Party provincial government announced that it was planning to collect a direct dividend from Manitoba Hydro "excess" profits. This was criticized by the provincial opposition parties since they felt it allowed excess spending by the government.
  • Manitoba Hydro has studied new HVDC transmission lines to run along the east edge of Lake Winnipeg. The additional transmission capacity would be required to develop stations at Gull (Keeyask), and Conawapa. This plan would offset the concentration of transmission lines in the area West of Lake Winnipeg, and would provide additional security against transmission failures due to adverse weather or other causes. However, this area has no roads and very little development. Some environmentalists argue that this vast area of boreal forest should not be crossed by a transmission corridor. Roads associated with the line would allow year-round access to small communities east of the lake; some people feel this would have more adverse than beneficial effects for these communities. In May 2005, the provincial government announced that it would not consider any route along the East side of Lake Winnipeg, even though the alternative routes through the Interlake region of Manitoba would extend the transmission lines, increase cost, and provide less security of transmission than the East side corridor.

[edit] Comparison of Manitoba Hydro to other utilities

Manitoba Hydro is unusual in North America because it is the sole commercial provider of electrical power in the province of Manitoba. It is a Crown corporation closely regulated by the Provincial government. This status arose because of the history of electrification in the Province, where early private commercial developers required a large initial return on investment owing to the high risks of the projects. This limited the economic benefits that electrification would bring. Manitoba Hydro is required by its regulating legislation to give priority to public benefit over profit.

Another unusual feature of Manitoba Hydro is that it is a completely integrated electrical utility, with generation, transmission, and distribution operations. This means that Manitoba Hydro can consider the total system cost and benefits of any new development, rather than, for example, building generation capacity that relies on a second party for transmission. An example of this approach was seen at the hearings for the recent Wuskwatim Generating Station project, in which environmental review for both the generating station and associated transmission facilities were carried out at the same time.

Manitoba Hydro's mandate to serve dictates that it builds enough transmission and generating firm capacity to serve the Manitoba home market first. However, in a typical year, more energy is available than the firm capacity. This can be economically exported from the Province. Since this energy is typically sold on short-term contracts or even on a spot market, the returns on these sales increase Manitoba Hydro's retained earnings, allowing domestic rates to be stable and low.

Since Manitoba Hydro is a Crown Corporation paying no dividends and not obligated to provide a return on investment to shareholders, energy costs to industrial and residential consumers are lower than they would otherwise be. These lower costs help offset some of the higher costs of doing business in a region far from large markets.

As a Provincial Crown Corporation, investment decisions by Manitoba Hydro are heavily influenced by political and economic goals of the provincial government. For example, in the 1986 Manitoba provincial election, the incumbent New Democratic Party government announced accelerated construction of the Limestone project, with promises of increased employment as a result. Limestone GS was estimated to create 6000 person-years of direct employment, 11,000 of indirect employment over the construction period of eight years. As part of the contract for the ten turbine-generator units, Canadian General Electric agreed to invest $10,000,000 CAD in Manitoba business operations, and to obtain at least 15 per cent of installation labour locally.

[edit] The company today

Today Manitoba Hydro serves a peak Manitoba electrical load of more than 4200 megawatts. Electrical supply to Manitoba customers was 22.4 terawatt-hours in fiscal 2004, with total revenues of $2.02 billion CAD. Export sales returned to the typical levels seen in 2001, due to easing of the 2003-2004 drought conditions and low water flows. The company also delivered 2.1 billion cubic metres of natural gas in 2004, which contributed $509 million CAD to revenues.

Manitoba Hydro had 5300 employees at the end of 2003. Capital assets were valued at nearly $10 billion CAD.

In fiscal 2003 (ending March 31, 2004), the total generation was 19.3 terawatt-hours. Due to low water levels, about 7 TW·h were imported to meet a Manitoba domestic consumption of 21.9 TW·h. In 2001 generation was nearly 32.7 terawatt-hours, allowing net export of 12 TW·h to customers in the United States, Ontario and Saskatchewan. Water levels for FY2004 are expected to be more typical, allowing Manitoba Hydro to resume its usual position as a net exporter of electrical energy. A terawatt-hour is the average annual consumption of 70,000 Manitoba residences,14,100 kW·h per year each. In fiscal 2004 ending March 31, 2005 total generation was 31.5 terawatt-hours, with imports greatly reduced to only 1.3 TW·h.

On the evening of January 17, 2005 Manitoba Hydro set a new record for demand of 4,146 MW, with a total interconnected generating capacity of approximately 5000 MW. This peak load has increased 4.7 per cent over the previous year and about 15.5% over 1996.

A subsidiary company, Manitoba Hydro International, provides electric power consulting services. Manitoba Hydro also operates a high-voltage DC laboratory. Meridium Power, a subsidiary company, markets a line of written-pole AC electric motors suitable for heavy loads on single-phase systems and for power quality improvement. W.I.R.E. Services supplies services to transmission line operators for re-rating and verification of transmission line capacity.

[edit] See also

[edit] References

[edit] External links

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