After ruling out more private-sector wind farms, Manitoba's NDP government said it will come up with a plan to fund new energy projects while also freezing hydroelectric rates and keeping its Crown-owned energy utility's debt load in check.

"We know we need new generation. We want that new generation to be publicly owned, and we have confidence in the (Manitoba Hydro) board and their ability to help deliver on that," Finance Minister Adrien Sala, who is responsible for Manitoba Hydro, told a legislature committee Thursday.

Sala's comments came the same day Manitoba Hydro reported more red ink in a quarterly fiscal update. 

The Crown utility is forecasting a $190-million net loss for the fiscal year that will end in March. That is $29 million higher than the loss predicted in the last quarterly update, and a big change from an original prediction of $450 million in net income last spring.

The change is due largely to drought conditions that have reduced water levels used to general power, along with other factors such as lower export prices and a warm autumn that reduced demand for heat.

The new numbers come at a time of turnover for Manitoba Hydro. The NDP government replaced the corporation’s board after defeating the former Progressive Conservative government in the Oct. 3 election.

The NDP-appointed board then dismissed chief executive officer Jay Grewal, who had promoted a plan to use wind power from independent providers as a way to quickly meet growing energy demand. 

The idea was not new. It had been mentioned by the previous board, and a former NDP government signed deals with two private wind farms more than a decade ago that continue to supply power to the province.

Grewal had said Manitoba will need new energy production as early as 2029, and new Manitoba Hydro dams would not be built quickly enough or be as cost-effective as wind farms.

The Opposition Progressive Conservatives accused the NDP of rejecting the private wind-farm plan with no backup strategy.

"(The year) 2029 is only a few years away," Tory Obby Khan told the committee.

Sala said a plan will be drawn up.

"We are a new government. We're just getting started in developing the plans that need to be put forward," Sala said. He said the former Tory government did nothing to build generating capacity during its seven years in power.

Manitoba Hydro has appointed an interim chief executive officer, Hal Turner, while it seeks a replacement for Grewal. Turner told the committee no decisions have been made yet on new energy production, and Manitoba Hydro is also looking to ease the rise in demand.

"I am confident that when we work with this new board, we will find the appropriate path forward that will allow us to meet Manitobans' energy needs safely and affordably," Turner said.

The NDP campaigned on a promise to freeze rates for consumers for one year. Sala said that promise remains, and will be done sometime before the next election, scheduled for 2027.

"That's a commitment that we're planning on delivering on," he said.

This report by The Canadian Press was first published Feb. 22, 2024.