How can Manitoba Hydro improve Power Smart?
Manitoba Hydro has received top ranking for its Power Smart energy conservation programs (p. 35 of 2010-2011 Power Smart Annual Review). But last year’s plan showed a sharp drop-off in anticipated savings over the next decade, as noted in by Philippe Dunsky. The Province has asked Manitobans how to improve Manitoba Hydro’s Power Smart performance. Green Action Centre’s full response can be found here.
Manitobans’ demand for electricity is rising so fast that, at peak times, it will outstrip the capacity of Conawapa and two Keeyasks in 35 years. It is no longer sufficient to view Power Smart as simply a customer service. Like a new dam, it is a resource that can be targeted and achieved to balance electricity demand with supply.
Recommendation 1: Manitoba Hydro needs to incorporate aggressive conservation measures (targeted resource acquisition) into its long-range integrated resource planning.
For decades, Manitoba Hydro has priced power in Manitoba at a discount. This has been done by subsidizing domestic rates with out-of-province profits and shielding consumers from the impending costs of new construction. Cheap electricity invites Manitobans to consume more and ignore the opportunities to save, thus undermining Power Smart efforts and contributing to rising demand. A solution? – Implement Power Smart inclined rates in which the last block of energy reflects the full cost of increasing electricity consumption. Both the Public Utilities Board and Manitoba Hydro have acknowledged the rates-conservation connection but have failed to agree how to do it. This is a costly and perverse regulatory failure.
Recommendation 2: Manitoba Hydro and the PUB need to follow through with a Power Smart rate strategy accompanied by a mitigation strategy for low-income customers. Green Action Centre has provided considerable evidence on these topics and has offered to help with rate and program design.
There are many other means to encourage customers to save as well. For example Hydro could print customized feedback on the bills of heavy consumers, such as “You use three times the average consumption in Manitoba, which costs you $xxx.xx dollars more every year. We can help you bring it down.”
Recommendation 3: In addition to continuing to develop higher efficiency standards, Manitoba Hydro needs to experiment with various economic and behavioral innovations to increase savings.
Finally, Manitoba Hydro needs to address the serious problem of growing conversions to electric heat. Such conversions are costly to customers, Manitoba Hydro and the Province and yield almost three times the amount of global greenhouse gases.
Recommendation 4: A core electricity conservation strategy for Manitoba Hydro should be to facilitate conversions from electric to other heat sources and arrest conversions in the other direction. As electricity prices rise, conversions away from electric heat should become even more economic than they are at present and can largely be funded from the pay-as-you-save (PAYS) program.
See also How can Manitoba Hydro best meet Manitobans’ need for power?
The $17-billion question – Winnipeg Free Press, March 1, 2014.