Drought conditions, administrative costs dry up Manitoba Hydro’s finances: fiscal report

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Manitoba Hydro reported a $157 million consolidated net loss according to the company's 2023-24 fiscal update.

The Crown Corporation said drought-like conditions resulted in lower water reservoirs, meaning a major source of income, exporting, dried up.

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“Low water conditions resulted in less excess energy being available to sell in wholesale markets, and the need to import power to meet customers’ requirements in Manitoba,” Hydro’s president and CEO Allan Danroth said in a media release Tuesday.

Hydro also said increased operating and administrative costs drove up the deficit this fiscal year, which ended March 31.

Tuesday’s reported loss is lower than the $190M net loss Hydro anticipated in February.

It’s the second time in three years that the corporation reported a net loss due to drought. In the 2021-2022 fiscal year, the company reported a $248M loss due to drought conditions.

In 2022-2023, Hydro reported a $638M net income.

“We continually try to operate our business as efficiently as possible to minimize the impact of drought on our customers. However, as a hydroelectric utility, there is a limit to what we can do when we are at the mercy of Mother Nature when it comes to precipitation.”

Danroth said precipitation in the late summer to early winter could impact Hydro’s financial future for the upcoming fiscal year.