MTS comparison raises spectre of Hydro privatization

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This article was published 18/2/2021 (539 days ago), so information in it may no longer be current.

A recording of the head of Manitoba Hydro telling employees the Crown corporation is about to undergo major changes — like those seen "when Bell or MTS was a monopoly" — has stoked fears about privatization.

In comments to Manitoba Hydro International staff, who are being absorbed into the main company as its consultancy is wound down, chief operating officer Jay Grewal said to prepare for "exciting times" and "huge opportunities."

"I believe this is an exciting time in the utility business, as we're creating the Manitoba Hydro of the future," Grewal said in an audio recording obtained by the NDP.

"The degree of change in our business as Manitoba Hydro we have never experienced — and it will be similar to the changes that have occurred in telecom from when Bell or MTS was a monopoly to the markets it operates in today."

Grewal's remarks indicate Hydro is heading down the same path as MTS, the former telecom Crown corporation sold under the PC government of premier Gary Filmon in the mid-1990s, according to NDP Leader Wab Kinew.

"This should make jaws drop. This is a terrible comparison to make, and yet the fact that this is being considered at the highest level tells you the Pallister government is obsessed with trying to privatize Manitoba Hydro," Kinew said at a news conference Thursday.

Hydro spokesman Bruce Owen later countered that stance, saying Grewal's remarks are being "misinterpreted," and the utility will remain a Crown corporation.

"The degree of change in our business as Manitoba Hydro we have never experienced – and it will be similar to the changes that have occurred in telecom from when Bell or MTS was a monopoly to the markets it operates in today." – Chief operating officer Jay Grewal

"The comparison Ms. Grewal was making was not to the corporate structure of MTS, but to the changes and advancements in telecommunications technologies that began to take place in that market in the 1990s," he said in an email. "The development of these technologies (internet, etc.) was accelerating rapidly at that time."

Hydro expects to see similar acceleration and rapid technological change in the energy sector in the coming years, Owen said.

"Some changes are already happening, driven by new advancements and products that are already available, including behind-the-meter technologies like rooftop solar (distributed generation), local energy storage (Tesla Powerwalls, for example), new digital management of the grid, and other digital technologies that can change the way we interact with our customers."

"The comparison Ms. Grewal was making was not to the corporate structure of MTS, but to the changes and advancements in telecommunications technologies that began to take place in that market in the 1990s. The development of these technologies (internet, etc.) was accelerating rapidly at that time." – Hydro spokesman Bruce Owen in an email

However, Grewal has previously said Hydro should prepare to no longer be a monopoly, and that smaller power producers may be joining the grid in the future, Kinew said.

"What actually happened with MTS was not smaller players coming into the market but rather larger telecoms entering the market — and MTS being privatized by a PC government... who, up until the day they did it, insisted they would never privatize," Kinew said.

The result was higher phone bills for Manitobans and job cuts, said NDP Hydro critic Adrien Sala.

"We're here to demand we get some clarity from this government, (and) what they're intending on doing with this most important Crown corporation," the St. James MLA said.

"The concern is we're going further and further down that parallel track that that ended up with MTS being privatized in the 1990s. We'll be facing higher and higher hydro bills." – NDP Leader Wab Kinew

The province's director of media relations and issues management said the NDP is trying to mislead Manitobans and deflect from its own "abysmal mismanagement" of Manitoba Hydro with "baseless fear mongering."

"Our government has been clear: we are committed to cleaning up the mess left by the NDP at Hydro, and will do so while strengthening it as a publicly-owned utility," Blake Robert said in an email.

The Tories were voted into power in 2016, after more than 16 years of NDP leadership.

Manitobans have come to rely on affordable electricity from the power company they own, Kinew said. They're also relying on Hydro to fight climate change, help develop an advanced economy, and reconcile with the impact it's had on Indigenous communities, he said.

"None of that will happen if Hydro gets privatized," Kinew said.

"The concern is we're going further and further down that parallel track that that ended up with MTS being privatized in the 1990s. We'll be facing higher and higher hydro bills."

Or, potentially, something worse.

The failure of the Texas power grid during this week's cold snap, leaving more than two million customers shivering in the dark, has been linked in part to the privatization of the state's electric utility in 2002.

An academic analysis of data from 1970 to 2011 by Eric L. Prentis at the University of St. Thomas (Houston) found relative electricity prices increased dramatically in Texas, while the reliability of the electrical system declined to "dangerous" levels.

carol.sanders@freepress.mb.ca