Manitoba premier orders provincial utility not to renew 500-MW US export deal

Manitoba Premier Wab Kinew has ordered Manitoba Hydro not to renew 500 MW of hydroelectricity exports to the US, opting to prioritize the power for economic development within the province.

The two contracts are set to expire at the end of April, but Kinew directed the crown corporation not to renew the contracts amid US and Canadian trade tensions.

"Everyone has been watching what has been happening across the country and thinking a lot about Canadian sovereignty," Kinew said at an April 14 news conference. "Manitoba has a wealth of Manitoba Hydroelectric resources, and we should use them as a province."

The Manitoba Hydro export contacts set to expire are with Minneapolis-based Xcel Energy Inc. subsidiary Northern States Power Co., Manitoba Hydro spokesperson Peter Chura told Platts, part of S&P Global Commodity Insights.

"We could have continued to renew these, but we have made the decision to focus on Manitoba's needs first," Kinew said. The premier said he had informed Minnesota Gov. Tim Walz of the decision not to renew the export contracts "a couple of months ago."

Manitoba Hydro signed the deals with Northern States Power in 2010. The first contract not being renewed consists of a capacity sale for 375 MW in the summer and 325 MW in the winter. The second contract is an annual capacity sale for 125 MW, according to Chura.

Transmission line to Nunavut

Despite the contract expirations, Manitoba Hydro is still moving forward with two export contracts it signed with Northern States Power in June 2024. The contracts include a summer capacity sale for 200 MW and a seasonal diversity exchange agreement of up to 350 MW. The new five-year agreements will begin May 1.

"We are a reliable partner when it comes to electricity," Kinew said. "To our partners in the States, we are going to continue to export hydroelectricity for many decades into the future."

Kinew said keeping the 500 MW of hydroelectricity in Manitoba would allow the province to explore economic development opportunities, such as housing, factories and trade corridors. As part of the announcement, he said the province will be constructing a new transmission line to export 50 MW into Nunavut, the northernmost territory in Canada.

The Nunavut transmission project "is great for the environment because it displaces diesel generators. It is great for Manitoba because it allows us to find a new export market for our hydroelectricity," Kinew said.

In March, Manitoba Hydro filed a general rate application seeking a 3.5% electricity rate increase for the next three years. The company said drought has already been negatively impacting the amount of electricity it could sell in the export market. Manitoba Hydro reported a net financial loss in two of the last three years due to drought, according to the company.

Kinew said the nonrenewal of the 500 MW of export contracts is factored into the company's general rate application.

"There are going to be a number of changes that we see in the coming years, all of which have been contemplated by Manitoba Hydro in their general rate application," he said.