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Manitoba Hydro wants to raise rates by 7.9 per cent in each of the next two years as it develops two major projects and watches its debt pile up.Mario Beauregard/The Canadian Press

Manitoba Hydro wants to raise rates by 7.9 per cent in each of the next two years as it develops two major projects and watches its debt pile up.

The Crown corporation has filed an application with the Public Utilities Board asking for the increase this year and again in 2018.

The initial increase would add $6.88 a month to the electricity bill of the average residential consumer using 1,000 kilowatt-hours a month.

A second hike in 2018 would add an additional $7.43 onto the monthly bill.

Kelvin Shepherd, president and CEO of Manitoba Hydro, says raising rates will help address the company's large debt and cash flow issues.

Manitoba Hydro's debt currently stands at $13-billion and the utility has said that could reach about $25-billion in the next few years "Without question, developing two major projects – the Keeyask generating station and Bipole III transmission line – at the same time has resulted in Manitoba Hydro taking on a significant amount of debt to finance the construction of those projects," Shepherd said in a release Friday.

If the utilities board approves the increases, the first would come into effect Aug. 1 and the second would be added April 1.

They would be on top of a 3.36 per cent increase approved in 2016.

Hydro said its long-term plan is to increase rates by 7.9 per cent each year over the next five years. Lower increases of two per cent would come in after that.

Shepherd said Manitoba Hydro still offers excellent value to customers. He noted that the province has among the lowest electricity rates in Canada and added that other jurisdictions also face potential rate increases as they renew their infrastructure and move away from carbon-based power generation.

Manitoba Hydro has already announced it is cutting 900 jobs as part of its cost-cutting measures.

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