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DE RUEHOT #0167/01 0322011
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R 012011Z FEB 08
FM AMEMBASSY OTTAWA
TO RUEHC/SECSTATE WASHDC 7241
INFO RHEBAAA/DEPT OF ENERGY WASHDC
RUEAEPA/HQ EPA WASHDC
RUCPDOC/USDOC WASHDC
RUCNCAN/ALL CANADIAN POSTS COLLECTIVE

UNCLAS OTTAWA 000167 
 
SIPDIS 
 
SIPDIS 
 
STATE FOR OES, EEB/ESC, WHA/CAN 
 
DOE FOR INT'L AND POLICY AND IE-141 
 
EPA FOR OFFICE OF THE ADMINISTRATOR AND INTERNATIONAL AFFAIRS 
 
USDOC FOR 4320/ITA/MAC/WH/ONIA - WORD 
 
E.O. 12958: N/A 
TAGS: ENRG SENV PGOV CA
SUBJ:  MANITOBA HYDRO ANNOUNCES MAJOR ELECTRICITY DEAL WITH 
MINNESOTA 
 
Ref:  Ottawa 0135 
 
¶1. This message originates from the U.S. Consulate in Winnipeg. 
 
¶2. SUMMARY:  The announcement of a major hydroelectricity purchase 
agreement between Minnesota Power and the Canadian province of 
Manitoba brings the development of some of the 5000 mw of 
hydroelectricity generation capacity in Manitoba's north an 
important step closer.  Significant amounts of this hydroelectricity 
will be available to U.S. markets in the upper Midwest, if the 
trans-border transmission capacity exists to deliver it (reftel). 
END SUMMARY. 
 
¶3. The decades-old logjam preventing the development of Manitoba's 
extensive hydroelectricity potential may have been broken with the 
announcement on January 29 of an agreement between Minnesota Power 
and Manitoba's government-owned hydroelectricity monopoly Manitoba 
Hydro.  The deal between Manitoba Hydro and investor-owned Minnesota 
Power allows Minnesota Power to purchase surplus energy beginnii3{Cm/Qi Q>Do#!BQQ1%V8Q-QQe|%"QQQQmQQeQ4op-oyK0Qi|zQQ\ eX#]ox)`KVQx2?QQK:QU"Dm,_&oQQQQkY'$@Q,Q.ej{Q_ XzTj-Q&8S$D.Y[7QRQ\%7#d/hQ-fPQlQFXW[=-LQA~Q6l D@Afu;SfPLQ 
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electricity go?  Manitoba Hydro projects that increases in 
in-province demand for electricity will utilize some of the 
additional power, and small increases in exports to other markets in 
neighboring Canadian provinces and U.S. states may take up some more 
of the excess.  But clearly Manitoba Hydro will have surplus 
electricity in 2020, with more available if the Gull Rapids project 
comes on-line with 600 mw.  Manitoba Hydro would welcome an 
expansion of transmission capacity: either east-west, to facilitate 
more exports to other provinces, or north-south, to enhance its 
export options.   The electricity would be available to potential 
customers either in the upper Midwest or neighboring provinces, but 
there is not sufficient transmission capacity to get all of it to 
either market. 
 
¶8. In recent years Manitoba and Ontario have studied the possibility 
of building an ambitious east-west line to get Conawapa power to 
 
 
Ontario markets.  Though the cost of this line would be daunting, 
the persistent lack of investment in the grid in border U.S. States 
has encouraged some Canadian players to advocate more east-west 
infrastructure as a way to open up Canada's undeveloped generating 
potential.  The Manitoba-Minnesota agreement is a strong signal that 
long-term trade on the established cross-border pattern can 
facilitate Canadian resource development in the future as well as it 
has in the past. 
 
WILKINS