1

2014–2015 Sustainable Development Report

Registered to ISO 14001

2MESSAGE FROM THE PRESIDENT

Manitobans continue to benefit from the province’s energy resources.

Our skilled and experienced employees work hard to serve the energy needs of the province. The work that we undertake is often challenging and complex and our progress toward integrating sustainability is made possible by the skills, commitment and hard work of our employees and by the support and guidance of the Manitoba Hydro Executive and Board of Directors. We are proud of our accomplishments and recognize we must continue to be diligent as we deliver your energy reliably, safely and affordably — today and tomorrow.

If you have feedback on how we can better communicate the activities we carry out that contribute to sustainability, please contact our Corporate Environment Department at environment@hydro.mb.ca.

Scott A. Thomson, CA President and Chief Executive Officer Manitoba Hydro

Manitobans pay among the lowest rates in North America for electricity and enjoy one of the most reliable and sustainable energy systems on the continent. The system that provides your energy today is a product of foresight and timely investments by previous generations.

Today, Manitoba Hydro faces multiple challenges, including a growing demand for energy, aging infrastructure and new opportunities for implementing innovative technologies in the delivery and use of electricity and natural gas. To address these challenges and develop solutions that are financially sound, environmentally responsible and right for Manitoba, we are once again investing in our future.

We have a plan and we have the people to successfully meet the challenges ahead. Manitoba Hydro is investing responsibly, balancing the need for reasonable rates with the need to preserve the financial health of the corporation.

This report provides a snapshot of some of the activities Manitoba Hydro has undertaken during the 2014–2015 fiscal year to integrate our sustainable development policy and principles into our operations to ensure future generations of

TABLE OF CONTENTS

PROTECTING YOUR ENVIRONMENT 4

BUILDING RELATIONSHIPS 10

STRENGTHENING OUR WORKFORCE 16

GROWING YOUR ECONOMY 19

DEMAND SIDE MANAGEMENT 24

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VISION

To be recognized as a leading utility in North America with respect to safety, reliability, rates, customer satisfaction and environmental leadership.

MISSION

To provide for the continuance of a supply of energy to meet the needs of the province and to promote economy and efficiency in the development, generation, transmission, distribution, supply and end-use of energy.

ENVIRONMENTAL MANAGEMENT POLICY

Manitoba Hydro is committed to protecting the environment by:

• preventing or minimizing any adverse impacts on the environment, and enhancing positive impacts

• continually improving our Environmental Management System

• meeting regulatory, contractual and voluntary requirements

• considering the interests and utilizing the knowledge of our customers, employees, communities, and stakeholders who may be affected by our actions

• reviewing our environmental objectives and targets annually to ensure improvement in our environmental performance

• documenting and reporting our activities and environmental performance

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The construction power station, built to provide the power needed to build the converter station and facilities, was placed in-service in July 2014.

PROTECTING YOUR ENVIRONMENT

Manitoba Hydro is committed to being proactive in protecting the environment in everything we do. Recognizing that the economy and the environment are interrelated and mutually dependent, environmentally responsible practices are integrated in all aspects of our business.

Constructing Keewatinohk Converter Station

northeast and the Keewatinohk Ground Electrode, located within the Fox Lake Resource Management Area, is 50 km southwest of the converter station.

To support the safety and security of the workers and materials required for construction, the project has developed an Access Management Plan to control site access and a Construction Environmental Protection Plan (CEnvPP) that provides environmental protection information. To protect the environment, site and contractor staff are required to develop plans as applicable including: Emergency Preparedness and Response; Waste and Recycling Management; Erosion and Sediment Control and Concrete Washout Management.

The Keewatinohk CEnvPP includes identification of environmentally sensitive sites (ESS); that are locations, features, areas, activities or facilities that are ecologically, socially, economically or culturally important or sensitive to

disturbance that will require protection during construction. The determination of ESS includes considerations of Aboriginal Traditional Knowledge. Throughout the project Manitoba Hydro will engage with those who continue to have concerns or additional information to share and update this plan with ESS and current knowledge. This could include First Nations, other local communities, the Manitoba Metis Federation and interested stakeholders.

The Bipole III Project is required to enhance Manitoba Hydro’s system reliability. The project includes a 1,384-kilometre (km), 500-kilovolt (kV) direct current (DC) transmission line; the Keewatinohk Converter Station in northern Manitoba; the Riel Converter Station east of Winnipeg; and five 230-kV-collector lines from Keewatinohk to Henday/Long Spruce stations. Once completed in 2018, Bipole III will reduce dependency on the Dorsey Converter Station and Manitoba Hydro’s existing high voltage direct current (HVDC) transmission corridor.

Hydroelectricity is generated at the northern generating stations as alternating current (AC) power, converted to DC power for transmission as it is more efficient over long distances and inverted back to AC at the southern terminus for end use. Keewatinohk Converter Station, the northern terminus of Bipole III, consists of the infrastructure and buildings to support its operation. The Keewatinohk Construction Camp is four kilometres

5Protecting your environment

Using a dip net during the fish salvage.

Environmental licence issued, generation station construction begins at Keeyask

On July 2, 2014 the Environment Act (Manitoba) licence for the 695-megawatt (MW) Keeyask Generation Project was issued to the Keeyask Hydropower Limited Partnership (KHLP). Manitoba Hydro and four partner First Nations: Tataskweyak Cree Nation and War Lake First Nation (working together as the Cree Nation Partners); Fox Lake Cree Nation and York Factory First Nation have together formed KHLP to develop this secure, renewable energy project in an environmentally and socially responsible manner.

The Keeyask Project now consists of three components, each with separate Environment Act (Manitoba) licenses; the Keeyask Generation Project, the Keeyask Infrastructure Project and outside the scope of the KHLP, the Keeyask Transmission Project. As the designated Project Manager, Manitoba Hydro oversees construction activities. Construction on the Keeyask Generation Project officially broke ground in July 2014 and is underway guided by an environmental protection program that includes technical science

and Aboriginal Traditional Knowledge. Manitoba Hydro is undertaking the technical science monitoring on behalf of the KHLP and each of the partner First Nations are implementing community-based monitoring. The Keeyask Monitoring Advisory Committee, involving Manitoba Hydro and the partner First Nations, meets regularly to review the status of the EPP and provide advice.

6Protecting your environment

Potential impacts of climate change on hydropower.

Climate change impact studies

Climate change is a long-term shift in overall weather conditions including changes in averages, variability and extremes. For a hydropower utility, these changes can influence energy production, infrastructure and energy demand. For example, changing temperatures and precipitation patterns may impact water supply while changes to temperature may drive seasonal shifts in energy demand.

Climate change is important to Manitoba Hydro’s future resource planning, operations and environmental studies. As such, climate change impact studies were conducted to better understand the range of potential future climate conditions. Global Climate Models (GCMs) are advanced computer models that project future climates based on a range of potential greenhouse gas (GHG) emissions. These future climates are used to assess local impacts and identify risks and opportunities which help guide adaptation strategies.

In resource planning, water supply is a key input. As part of the Needs for and Alternatives To (NFAT) Manitoba Hydro used future runoff from GCMs in an economic sensitivity analysis to assess how climate change could affect various development options. In preparation of

the Lake Winnipeg Regulation hearings, a hydroclimatic analysis was conducted to characterize historic climate and project future climate conditions for the Lake Winnipeg area. GCMs were used to develop

potential future temperature, precipitation, evaporation, runoff and wind conditions to understand how the environment may change in the future under climate change.

7Protecting your environment Raising walleye and lake sturgeon for restocking

Grand Rapids Fish Hatchery was built in 1973 to stock recreational sport fish throughout Manitoba and to mitigate impacts of the Grand Rapids Generating Station. Originally owned and operated by the Province of Manitoba, the hatchery has, since 1990, produced fish under contract for Manitoba Hydro’s mitigation and stewardship programs. In 2007, Manitoba Hydro purchased the hatchery and took over its full operation in 2012 to support the ongoing stocking of walleye fry for the Saskatchewan River, Southern Indian Lake and its tributaries; and lake sturgeon fingerlings and yearlings for the Nelson River.

Walleye are considered an important natural resource by commercial harvesters, recreational fishers and highly valued by First Nations. Egg and sperm collection from wild adults captured in the Saskatchewan River, egg incubation, hatch and fry stocking activities typically occur annually from mid-May through mid-June.

Lake sturgeon are considered a heritage species in Manitoba as they have limited distribution, possess unique life history characteristics and are socially and historically significant. Grand Rapids Hatchery has been rearing lake sturgeon since 1994 when stocking efforts to recover

populations began in the upper Nelson River. To meet provincial and federal regulations, lake sturgeon can only be stocked into a river system that their parents were from, and for each population targeted, effort is taken to produce at least four family groups. As part of the Keeyask Environment Act licence, Manitoba Hydro is required to stock lake sturgeon for 50 years, or until such time as self-sustaining populations are re-established in the Keeyask area of the Nelson River.

Grand Rapids Fish Hatchery produces lake sturgeon yearlings and walleye fry for stocking.

8Protecting your environment Keeping transmission corridors clear

Manitoba Hydro currently delivers electricity to customers using over 13,000 km of transmission lines and 76,000 km of distribution lines. Transmission lines are used to transfer electricity from the generating stations across the province, inter-provincially and internationally. Distribution lines are used to link the end customer to Manitoba Hydro’s electrical system with lines that are typically shorter and operate at lower voltages.

When vegetation comes in contact with or grows close enough to power lines there is a risk of electrical arcing or flashover that can cause widespread power outages. Recognizing the need to safeguard the reliability of the transmission system, an integrated vegetation management program was developed to control the growth of trees on our right-of-ways while respecting the natural environment that surrounds them.

Annual patrols help to determine the vegetation management strategies and the methods selected are based on density of non-compatible species, terrain, environmental sensitivities and economic feasibility. Vegetation removal requiring mechanical equipment is typically scheduled during the winter season when the ground is frozen to

ensure that ground disturbance is kept to a minimum. Herbicide control is intended to selectively remove tall-growing tree species, allowing low-growing species to thrive.

To limit disturbance in sensitive areas, buffers for both herbicide and mechanical activities are established around riparian areas and wetlands. Particular care and attention are taken in designated protected areas and in areas of special interest to

respect environmental sensitivities. In agricultural areas, protocols are followed to help reduce the transfer of pests, disease or invasive species. In culturally sensitive areas, vegetation management strategies are determined in communication with local communities and respective governments and are based on methods that would have the least significant environmental impact and ecological footprint.

Vegetation management strategies are developed to reduce the potential for flashovers.

9Protecting your environment

Manitoba Hydro 2014 GHG emissions by source

FAST FACT: Global GHG emission displacement

Electricity exported by Manitoba Hydro displaces energy outside of Manitoba that would otherwise be produced by fossil-fuelled electric generating stations. In 2014, 6,600 kt of CO2e was displaced by exports of electricity generated by Manitoba Hydro with a net cumulative total global displacement of GHG emissions of 189,000 kt of CO2e since 1991.

Recycling at Manitoba Hydro Place

Incorporated into the design considerations of Manitoba Hydro Place – 360 Portage – was the integration of recycling receptacles so that they blend in and are part of the office infrastructure. In 2014–2015 the following recyclables were collected from these receptacles.

INDICATOR: Sources of electricity

In 2014–2015, 99.6% of electricity in Manitoba was generated from renewable sources.

INDICATOR: GHG emissions

In 2014 Manitoba Hydro’s total direct GHG emissions were 147 kilotonnes (kt) of carbon dioxide equivalent (CO2e). This is 72% below the voluntary target threshold of 520 kt CO2e based upon a 6% reduction below the 1990 emission levels.

FAST FACT: E-waste

In 2014–2015, 2,479 pieces of computing equipment were donated or recycled.

FAST FACT: Recycling non-hazardous wastes

In 2014–2015 Manitoba Hydro recycled 1,993 metric tonnes of non-hazardous materials.

Electric generation

54%

Other 13%

Fleet vehicles

14%

Natural gasoperations

19%

Paper 21.92 tonnes

Plastic 1.91 tonnes

Aluminum 0.96 tonnes

Cardboard 18.76 tonnes

Improving customer service to ensure public safetyPublic safety is one of Manitoba Hydro’s top priorities and for excavation purposes it starts with the Call Before You Dig program. With recent amendments to the Gas Pipe Line Act (2014) removing the requirement for signatures, Manitoba Hydro was able to change work practices, create a more efficient process and provide a faster response. Manitoba Hydro receives over 45,000 line locate requests each year.

To continue capitalizing on the strengths of the Mobile Workforce Management (MWM) system, Manitoba Hydro moved to an electronic notification for all line locate requests. The new process starts with the customer contacting Manitoba Hydro and providing verbal descriptors that compliment the practice of “white lining” for residential customers and electronic pre-marks for contractors. Through MWM staff are able to receive and complete the locate requests from their mobile office – a vehicle outfitted with a specialized laptop and the equipment needed to locate underground infrastructure. Once the physical locate

is complete, an email is provided to the customer by the end of the business day with an attached copy of their clearance request form, a detailed map of the excavation area identifying all hazards and instructions along with links to safe excavation practices.

What the customer does not see is the staff working with MWM, assigning and routing

the appointments and ensuring resources are allocated where they are needed. In 2014–2015 the new line locate process was successfully piloted in the Winnipeg and Selkirk areas with immediate results and positive customer feedback. The process is scheduled to be implemented in the remainder of the province in 2015–2016.

Providing more timely line locate services

10BUILDING RELATIONSHIPS

Manitoba Hydro is committed to the continued fostering of productive relationships with our customers, employees and other stakeholders in the communities in which we live and work.

Working with the communities to build capacity in environmental monitoring

The Bipole III Transmission Project will improve overall system reliability by reducing heavy reliance on one transmission corridor and a single converter station in the south (Dorsey). The Environmental Protection Program (EPP) for the Bipole III Project prescribes mitigation and protection measures to avoid and reduce potential environmental and social effects. Construction is being undertaken with the guidance of Construction Environmental Protection Plans to avoid and minimize adverse environmental effects.

Manitoba Hydro is committed to engaging local community-based environmental expertise during construction of the project. Manitoba Hydro is funding qualified and interested local individuals to work as Environmental Monitors and Community

Liaisons. These individuals are engaged and working alongside Environmental Inspectors to gain capacity in environmental monitoring activities and act as a resource for local construction activities by sharing traditional and local knowledge of the area and their perspective on the environment.

Environmental Monitors assist in daily inspections with Environmental Inspectors, collect monitoring information and help in the location of and delineation of environmentally sensitive sites. In 2014–2015, seven Environmental Monitors were employed from the following communities: Fox Lake Cree Nation; Tataskweyak Cree Nation; Thicket Portage Community Council; Wabowden Community Council; Cormorant Community Council; Opaskwayak Cree Nation; and Pine Creek First Nation.

Community Liaisons are the primary communication links between in-vicinity communities and Manitoba Hydro. The communities have one of their own members on-site to observe the construction, contribute to the monitoring activities, advise Manitoba Hydro of any community concerns or issues and report back on work progress and environmental protection. In 2014–2015, 12 Community Liaison Officers were employed from the communities of: Fox Lake Cree Nation; York Factory First Nation; Tataskweyak Cree Nation; Thicket Portage Community Council; Wabowden Community Council; Cormorant Community Council; Opaskwayak Cree Nation; Pine Creek First Nation; Camperville Community Council; Duck Bay Community Council; O-Chi-chak-ko-sipi First Nation; and Ebb and Flow First Nation.

Bipole III environmental monitoring activities.

11Building relationships

Supporting community partners

Lake Winnipeg Regulation was constructed to reduce shoreline flooding on Lake Winnipeg and to provide more reliable flows for the generating stations downstream on the Nelson River. It is a cornerstone of Manitoba Hydro’s hydroelectric power generating system.

Manitoba Hydro directly engages with the public about their concerns through the Lake Winnipeg Engagement Program and indirectly through the development of partnerships, participation in and financial support of many Lake Winnipeg stakeholder initiatives involving scientific research, environmental monitoring and development of best management practices, stewardship and education to foster an understanding of the health of lakes and waterways.

Key examples of Lake Winnipeg related partnership activities supported by Manitoba Hydro in 2014–2015 include the following:

• Lake Winnipeg Research Consortium

• Water Innovation Centre of the International Institute for Sustainable Development

• Manitoba Museum’s Lake Winnipeg: Shared Solutions permanent exhibit

• Become An Aquavist public awareness initiative of Lake Friendly

• First Nations Alliance for Lake Winnipeg (renamed Lake Winnipeg Indigenous Collective)

• Lake Winnipeg Foundation’s Netley-Libau Marsh Restoration initiative

• Lake Friendly Buildings initiative

The Namao is a retired Coast Guard ship given to the Lake Winnipeg Research Consortium and used as a research platform for scientists seeking a better understanding of Lake Winnipeg.

12Building relationships

We want to hear from you.Northwest Winnipeg Natural Gas Pipeline

Open House

To ensure a reliable and continual source of natural gas to our customers, Manitoba Hydro is proposing to extend an existing pipeline located at Selkirk Avenue and the Perimeter Highway. The proposed pipeline will travel north to increase supply in Stonewall and then east to connect to an existing pipeline outside of Selkirk.

Manitoba Hydro will hold open houses to share information and gather feedback on the Northwest Winnipeg Natural Gas Pipeline. Feel free to drop in any time between 4 and 8 p.m. at the locations listed at right.

All are welcome to attend and refreshments will be served.

Rosser/ Grosse IsleTuesday, February 3 4 to 8 p.m. Hitch ‘n Post Ranch Hwy. 6 at Ridge Road

StonewallThursday, February 5 4 to 8 p.m. Parochial Hall 435 First Ave. N.

SelkirkWednesday, February 4 4 to 8 p.m. Royal Canadian Legion Selkirk Branch 42 403 Eveline St.

Opportunities for public participation

As the major natural gas distributor in the province, Manitoba Hydro purchases natural gas from suppliers and delivers it to over 274,000 customers using a vast network of pipelines to nearly 100 communities across southern Manitoba. The proposed Northwest Winnipeg Natural Gas Project will provide additional capacity to meet the present and future needs of the growing communities located north of Winnipeg and enable operational flexibility of the system in the event of outages. This project will involve installing approximately 53 km of 12-inch diameter pipeline and 6.6 km of six-inch diameter pipeline to extend the natural gas pipeline north from Winnipeg to Stonewall and connect with an existing pipeline near Selkirk.

As this project requires a Class 2 licence under the Environment Act (Manitoba), an Environmental Impact Assessment (EIA) will be completed and submitted to regulators. Important in the determination of the route and the development of an environmental assessment is feedback gathered through the public engagement process. Opportunities offered to provide feedback on the project in 2014–2015 included: three drop-in open houses, related newspaper advertisements and

postcards, a project webpage, a toll-free project information phone line and a project email address.

The open houses were held in the communities of Rosser/Grosse Isle, Selkirk and Stonewall in February 2015. Information provided at the open houses included: the need for the project, the

preferred route for the project, project components, pipeline safety, construction installation techniques and property acquisition. Feedback was considered in the development of the EIA and modifications were made to the final placement of the pipeline based on public input. It is anticipated that the EIA will be filed with Provincial regulators in 2015–2016.

Postcard developed for the open houses held in February 2015.

13Building relationships

Affordable energy partnerships

Manitoba Hydro, in partnership with Aki Energy, launched a Solar Hot Water Tank Pilot Program in 2014–2015. Water heating is the second largest energy consumer in a home and can account for approximately 20 per cent of annual energy cost. Manitoba has an abundance of solar energy year round. Solar water heating systems harness the sun’s energy to pre-heat water that enters a home’s hot water tank. The water heater will then use less energy to reach the desired temperature for a household’s hot water needs. Solar water heating systems can operate year round and will raise water temperatures on average by 23 to 28 degrees Celsius. That can provide for significant savings to the homeowner over the year.

Aki Energy, a non-profit Aboriginal social enterprise, works with First Nations to help save money on their energy bills through the development of community-owned renewable energy projects. They also assist with community capacity building through training of community members to install and maintain those projects. During the hands-on training provided as part of the pilot, students were able to observe and participate in every aspect of the installation of residential solar thermal hot water heating systems and learn about system maintenance and troubleshooting.

Similar to the successful Community Geothermal Program, the 20 participating homeowners were able to finance their solar hot water tank systems though Manitoba Hydro’s Pay As You Save (PAYS) Financing, which is a convenient and affordable financing tool. This helps to overcome the upfront barriers and unlock valuable long-term energy savings

as the capital cost of installing the solar hot water system is financed through energy bill savings over a 20-year period. Pilot program participants were also offered technical guidance and energy bill assessment services which, when combined with other upgrades such as insulation and water conservation, help to make these homes more energy efficient.

Inspecting a solar hot water tank system.

14Building relationships

Creating employment opportunities for northern residents

In 2014–2015, Manitoba Hydro partnered with the provincial government and several industry; education and training partners to create the Northern Construction Trades Training Pilot Program (NCTT). The program will train up to 30 northern Aboriginal people to journeyperson status in the Industrial Electrical, Industrial Mechanical and Pipefitter/Steamfitter trades.

NCTT aims to increase the number of qualified northern Aboriginal trades people in the labour market by providing access to apprenticeship training and work experience in those industries where these skills are needed. With the involvement of the Northern Manitoba Sector Council apprentices can move among employers during their practical training, ensuring that they are exposed to the full scope of their trade. The Northern Manitoba Sector Council, of which Manitoba Hydro is a member, is a not-for-profit corporation that brings together employers, educators, government and other stakeholders to address employers’ training and recruitment needs.

FAST FACT: Enhancing our communities

In 2014–2015, the Forest Enhancement Program provided funding to 40 projects to enhance community forests and support forest education. Since 1995, over 120,000 trees have been planted as a result of this program.

Winnipeg-CORE (Community Orchards for Resource and Education) established an inner-city orchard in an open space at the Forks to educate and demonstrate best practices in growing local fruit.

15Building relationships

Orientation to safetySafety is Manitoba Hydro’s most important priority. Our safety performance can be attributed to the development of a safety culture among our employees supported by a system of safety policies and procedures to minimize risk and protect lives, property and the environment. Comprehensive safety programs along with supporting resources have been implemented that focus on employee orientation, safety training, job planning and work site visits.

A safety orientation is provided to all new employees, supported by resources which include standard checklists for the new employee and their supervisor identifying seven key topics. These topics are accompanied by a series of modules that include: Safety for the New Employee; Workplace Hazardous Materials Information System (WHMIS); Office Ergonomics; Slips, Trips & Falls; the Lost Youth Video; and if applicable Virtual Driver Program; Downtown Orientation; and Transportation of Dangerous Goods. Job specific safety training resources are added to the orientation as required.

STRENGTHENING OUR WORKFORCE

Manitoba Hydro remains committed to the safety of our employees and being an employer of choice.

Safety for the New Employee is an eLearning course developed in-house for new hires, summer students, re-hires, transfers and employees returning to work from extended absences. It provides an overview of Manitoba Hydro’s safety programs, policies, procedures and practices including but not limited to rules, risks, regulations, rights and responsibilities of both the employee and the employer. It also covers safety as it relates to personal protection, vehicles, tools and equipment.

Youth are a vitally important part of Manitoba Hydro’s workforce. Targeted resources are provided to address this age group including presentations on job planning, the safety rule book and the Lost Youth video.

Safety is Manitoba Hydro’s top priority.

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TARGET PERFORMANCE

Accident severity rate (days per 200,000 hours worked) <12 6.6

Accident frequency rate (number of accidents per 200,000 hours worked) <0.6 0.4

Serious incidents 0 5

Recruiting our workforce and being an employer of choiceTo meet our workforce needs, both for today and for the future, Manitoba Hydro employs recruitment strategies to attract, develop and retain a highly-skilled and motivated workforce that reflects the demographics of Manitoba’s labour force and population. Manitoba Hydro actively engages in a variety of outreach activities to promote opportunities and awareness of careers at Manitoba Hydro including participation in annual competitions that

recognize leading employers who offer exceptional workplaces for their employees.

In 2014–2015, Manitoba Hydro was recognized as an Employer of Choice by the editors of Canada’s Top 100 Employers competition in six individual categories.

• Canada’s Top 100 Employers

• Manitoba’s Top Employers

• Canada’s Best Diversity Employers

• Top Employers for Canadians Over 40

• Canada’s Greenest Employers

• Canada’s Top Employers for Young People

In June 2014, the Corporate Knights recognized Manitoba Hydro as one of the Best 50 Corporate Citizens in Canada based upon corporate sustainability performance criteria that consider the integration of social, economic and ecological benefits and costs.

INDICATORS: Safety

17Strengthening our workforce

Student summer employment opportunities

Manitoba Hydro’s Summer Student Program continues to be an important part of our overall recruitment strategy as it provides an excellent opportunity to build relationships with students and demonstrate that Manitoba Hydro is a great place to work upon graduation.

Although historically the goal of this program was to provide work to as many students as possible, the focus is now on developing strong, long-term relationships with high-potential candidates and re-hiring them in future summers — with the ultimate goal of recruiting them after graduation. Each year students are hired throughout Manitoba to work in areas of: engineering; technology; accounting; marketing; information technology; environmental studies, administration; and general labour.

Becoming a summer student provides a great opportunity to explore employment with Manitoba Hydro. To build the student relationship, development opportunities are created to make the students’ work experience valued and meaningful — providing challenging work, job shadowing, job rotation, mentorships, project ownership and exposing them to various employment opportunities in the corporation.

To be eligible to work at Manitoba Hydro students must register with provincial STEP services commencing in October. Students must be enrolled in full-time studies both before and after the work term, be a minimum of 16 years of age and be eligible to work in Canada. The selection process begins in late January for the May–August work term. Once hired, summer students attend an orientation session that features greetings from senior management, and a safety orientation. In 2014–2015, a total of 250 summer students were hired, including 152 students from the previous year’s program.

Summer students gain work experience and are provided an opportunity to explore career options available at Manitoba Hydro.

TARGET PERFORMANCE

Women 26% 24.3%

Persons with Disabilities 6% 9.5%

Visible minority 7% 7.9%

Aboriginal employment corporate overall 16% 17.9%

Aboriginal employment northern 45% 45.9%

INDICATORS: Achieving a diverse and representative workforce

18Strengthening our workforce

GROWING YOUR ECONOMY

Manitoba Hydro is committed to meeting the energy needs of present and future Manitobans, contributing to a growing and productive economy, while encouraging the efficient and economic use of resources in our operations.

Enhancing our supply chain

Finding ways to reduce costs and increase efficiency is one of our top priorities. With investments in the development of our major capital projects and significant infrastructure upgrades underway, the demand on our internal services has never been greater. Accordingly, the corporation is examining how its internal service providers can best support this growth.

Manitoba Hydro has initiated a multi-year Supply Chain Performance Enhancement Program (SCPEP) that seeks to find operational efficiencies in our materials

management, purchasing and fleet services processes and to drive greater value from the procurement of goods and services. The initial assessment phase, which concluded in May 2014, identified numerous opportunities to realize greater operational efficiency through process improvements and implementation of leading practices. These opportunities were then prioritized according to potential value, ease of implementation and time required to implement. The highest priority initiatives were organized into an implementation roadmap that will be executed over the next four years.

Implementation of the roadmap began in February 2015 and by the end of 2014–2015, five major SCPEP projects were underway. An early success during 2014–2015 resulted from a review of stationery purchased across Manitoba Hydro. The corporation will save nearly $400,000 over the next five years by reducing the variety of envelopes purchased to a few standard types and by using the smallest, lightest envelope appropriate for each application it will be more economical and minimize waste.

INDICATOR: Providing affordable energy— how do we compare?

Manitoba Hydro’s electricity rates continue to be among the lowest overall in North America.

INDICATOR: Debt to Equity Ratio

This financial measure serves to monitor the corporation’s financial stability. A positive equity position assists Manitoba Hydro to make the required investments to renew our aging infrastructure, build the capacity in our generation, transmission and distribution systems to enhance our reliability and meet the future energy needs of our customers.

79:21

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Improving reliability with Riel

In October 2014, the Riel Reliability Improvement Initiative was completed and energized. This project involved the construction of a new 230-kV to 500-kV terminal station and sectionalizing of the existing 500-kV international transmission line to provide an alternative terminal station on the east side of Winnipeg.

This initiative improves the reliability of the transmission system serving southern Manitoba by reducing dependence on the existing terminal station at Dorsey and creating a second point from where electricity can be exported and imported to and from the United States. Maintaining import capability is critically important to the reliability of Manitoba Hydro’s system during prolonged periods of drought, prolonged outages at Dorsey Station and managing critical emergency situations on the transmission system.

Construction began on this project with the issuance of the Environment Act (Manitoba) license in April 2009 and was completed under the guidance of a comprehensive Environmental Protection Plan. HVDC System before and after the Riel Reliability Improvement Initiative.

Proposed interconnection to the south

The proposed Manitoba–Minnesota Transmission Project (MMTP) interconnection is a key component of Manitoba Hydro’s future development. This project will increase the transfer capability between Manitoba and the United States enabling additional export sales revenue and increasing reliability in the event of an emergency outage or extreme drought.

In 2014–2015, alternative routes were presented to the public during Round 2 of the MMTP public engagement process. Based on the feedback received and the environmental assessment undertaken, a preferred route was determined and presented during Round 3, which is scheduled to be completed in the summer of 2015 with the filing of the Environmental

Impact Statement (EIS) and the final preferred route. Ongoing communication is important to keep the public informed and will continue to include email campaigns, letters and website updates. To address concerns and answer questions, a dedicated email address and toll free information telephone line will remain available throughout the upcoming phases of the project.

20Growing your economy

FAST FACT: Encouraging northern business opportunities

In 2014–2015 over 100 contracts were awarded to Aboriginal companies for work totaling $183,954 million, increasing the total amount over the last decade to $1.2 billion. Manitoba Hydro’s commitment to develop and maintain relationships with Aboriginal businesses is demonstrated through our Northern Purchasing Policy which encourages participation in business and employment opportunities for Aboriginal and northern communities.

FAST FACT: Keeyask employment

Total employment on the Keeyask Generation Project for 2014–2015 was 632 person-years of employment. A person-year of employment is defined as one full-time position for one year. This typically represents about 2,000 hours of work based on a standard 40 hour work week.

Manitoba89%

Southern ManitobaNon-Aboriginal

26%

Northern Manitoba

Non-Aboriginal

22%

Southern Manitoba

Aboriginal

12%Non-Manitoba

11%

Northern ManitobaAboriginal

29%

Total person years of employment breakdown

FAST FACT: Value of Keeyask business contracts

Approximately $400 million in direct negotiated contracts have been awarded to partner First Nation owned businesses from the beginning of the total project to March 31 2015.

21Growing your economy

Monitoring the lines

Both sustained outages and momentary interruptions have the potential to negatively affect public health and safety, economic activity and societal well-being. To address safety, reliability and efficiency, along with customer value, Manitoba Hydro has developed a Smart Grid strategy.

Fault Circuit Indicators (FCI) are sensors that detect a sudden change in current or loss of current to indicate a permanent or momentary fault that can be caused by such things as lightning, trees on the line or equipment failure. Traditionally fault location on distribution lines required an operator to inspect each FCI unit to determine where the faulted section lay. This method required extensive line patrols and relied on the expertise of field staff to detect, isolate and then repair the faults.

Intelligent Fault Current Indicators (IFCI) are a new technology integrated into a two-way communications network that notifies system operators and field crews when faults occur or current levels are outside normal operating boundaries. By monitoring fault occurrences and their pre-cursors, more informed decisions can be made as Manitoba Hydro can better initiate corrective or preventative actions to reduce the number of customers who experience

sustained outages and the average duration of outages.

Like many utilities, Manitoba Hydro is faced with new applications of technologies in the midst of an environment of developing standards, rapidly evolving technology and the convergence of the electrical system and communication and information technology systems. In 2012, Manitoba Hydro initiated a multi-year pilot project to install various models of IFCIs to evaluate their capabilities and performance. By the end of 2014–2015, 277 IFCI sensors had been installed on 14 distribution lines throughout the province to provide visibility out on the line for the operators and near real-time information that increases reliability and decreases operating costs.

Line sensors used for monitoring.

Addressing risk

Risks associated with managing an integrated electricity and natural gas utility are significant. They include the impact of weather on supply and demand, price and market uncertainties, interest, inflation and foreign exchange rates, skilled labour availability and costs, aging infrastructure maintenance and replacement, increasing regulatory, environmental and legal requirements and accelerated technological change. Manitoba Hydro manages these risks through a control framework that is systematic, proactive and integrated. The process is designed to balance the objectives of identifying threats that affect the achievement of the corporation’s mission and mandate, mitigating consequences of negative occurrences and taking advantage of opportunities to provide benefits to all stakeholders.

Regular comprehensive risk reviews are undertaken throughout the corporation. The process starts with an assessment of the strategic goals, identification of risks based on factors that influence performance, analyzing these factors for potential impact and measuring these impacts in terms of consequence and likelihood (probability). Consequence for Manitoba Hydro has been quantified in terms of system reliability, safety, financial, environmental

22Growing your economy

to reduce the likelihood of a negative event or to reduce the negative consequences should the event occur. This may include a reduction of the risk through modification of activities, a sharing of the risk through external insurance or acceptance of the risk as a normal consequence of the business and/or operations.

To ensure adequate control and monitoring of risk, the corporation has established rules, limits, targets and guidelines and continually monitors these indicators/tolerance limits and responds accordingly. Although a certain level of residual risk may remain even after actions have been taken, an assessment is performed to confirm that they are within approved tolerances. Key risks are closely monitored and reporting mechanisms, such as a dashboard, are established to provide information that is then used to prompt management discussions and actions.

Addressing risk (continued)

Consideration of sustainability in Manitoba Hydro’s development plans

In response to growing electricity demand over the next two decades, Manitoba Hydro prepared development plans to meet these future needs. At the request of the Government of Manitoba, the Public Utilities Board (PUB) conducted a review into the Needs for and Alternatives To (NFAT) and the new generation and transmission associated with these development plans. This review was in addition to the environmental regulatory approvals required for individual projects.

As part of the process for preparing the development plans, potential technologies and options were screened from technical, environmental, social and economic perspectives with the most favourable technologies and options going on to more detailed analysis such

FAST FACT: Providing electricity to our neighbours to the west

In July 2014, Manitoba Hydro signed a Power Purchase Agreement to provide SaskPower with 25 MW of electricity for 6.5 years starting in November 2015. This is the first long-term power sale agreement in recent memory to provide SaskPower with a source of clean, renewable, affordable electricity to serve its northern Saskatchewan load requirements. SaskPower has been an important customer since the first Manitoba to Saskatchewan interconnection went into service in 1960 and routinely purchases electricity from Manitoba Hydro on a much shorter term basis.

as multiple-account benefit-cost analysis (MA BCA) which provides a provincial, rather than a corporate perspective. Sustainability considerations in the MA BCA included: employment and income, benefits to project partners, impacts on affected communities and GHG impacts in Manitoba.

The NFAT hearings were held March 3 to May 26, 2014. On June 20, 2014, the PUB issued its report recommending Manitoba Hydro proceed with the Keeyask Generation Project and the Manitoba–Minnesota Transmission Project.

23Growing your economy

DEMAND SIDE MANAGEMENT

Manitoba Hydro is investing in aggressive demand side management (DSM) to meet future energy demand and help our customers reduce their energy bills.

*Manitoba Hydro is a licensee of the Trademark and Official Mark.

Achievement Award for highest natural gas saving per customer

FAST FACT: Saving with Power Smart

Manitoba Hydro’s Power Smart portfolio includes 29 customer service, cost-recovery, incentive-based and rate-based programs customized to meet the specific energy needs of residential, commercial, agricultural and industrial markets. During 2014–2015, there were more than 475,000 participants in the various Power Smart programs. Cumulatively, there have been more than 1.3 million participants since the inception of Power Smart at Manitoba Hydro in 1989.

Power Smart* provides practical solutions and incentives to help customers get the most out of what they spend on energy. Being Power Smart can help offset increases in energy rates, while reducing environmental impact. Power Smart helps Manitobans save on their energy bills by making their homes and businesses more energy efficient. Manitoba Hydro’s highly successful Power Smart programs continue to encourage residential, commercial and industrial customers to use energy more efficiently through information that builds understanding and awareness and investing in energy efficient technologies through incentives along with a variety of convenient financing options.

Our Power Smart Plan will reduce projected load growth by two-thirds by using incentive-based programs, education, research, support for changes to building codes and standards, rate initiatives and innovative community partnerships. These efforts work towards making permanent shifts in the Manitoba marketplace for long-term adoption of energy efficient technologies and practices.

Hydro’s commitment to aggressive energy conservation through continued investments in our Power Smart programs. E Source, is an independent U.S. firm that provides research and advisory services to utilities on DSM and improving customer service.

Manitoba Hydro was ranked as achieving the highest natural gas savings per customer among 53 utilities across North America and received a prestigious Achievement Award from E Source on October 3, 2014. This award confirms Manitoba

FAST FACT: Customer savings

In 2014–2015 alone, the savings reduced customers’ electricity bills by $82 million and natural gas bills by $31 million. Cumulative customer savings to date total approximately $1.2 billion.

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2014–2015 ANNUAL SAVINGS TARGET PERFORMANCE

Electric energy – gigawatt hours (GWh) 363 GWh 281 GWh

Electric capacity – megawatt (MW) 243 MW 217 MW

Natural gas energy – cubic metres (m3) 10.2 million m3 12.6 million m3

For more information• Manitoba Hydro

www.hydro.mb.ca

• Sustainable development policy www.hydro.mb.ca/environment/env_management/sdp.shtml

• System renewal www.hydro.mb.ca/projects/system_renewal/index.shtml

• Keeyask Generation Project keeyask.com/wp/the-project

• Keeyask Hydropower Limited Partnership keeyask.com/wp/

• Keeyask Environmental Protection Program keeyask.com/wp/the-project/environment-and-montoring/preliminary-environmental-protection-program

• Bipole III Transmission Project www.hydro.mb.ca/projects/bipoleIII/index.shtml

• Keewatinohk Converter Station www.hydro.mb.ca/projects/bipoleIII/ converter_stations.shtml

• Keewatinohk Access Management Plan www.hydro.mb.ca/projects/bipoleIII/pdfs/environmental_protection/keewatinoow_converter_station_construction_access_management_plan.pdf

• Keewatinohk Construction Environmental Protection Plan www.hydro.mb.ca/projects/bipoleIII/pdfs/environmental_protection/keewatinoow_converter_station_and_ground_electrode.pdf

• Overview of Climate Change Impacts and what it means to Manitoba www.pub.gov.mb.ca/nfat_hearing/NFAT%20Exhibits/MH-191.pdf

• Needs for and Alternatives to Chapter 10 – Economic Uncertainty Analysis - Probabilistic Analysis and Sensitivities – Climate Change (10.2.2) www.hydro.mb.ca/projects/development_plan/bc_documents/nfat_business_case_chapter_10_economic_uncertainty_analysis_probabilistic_analysis_and_sensitivities.pdf

• Lake Winnipeg Regulation www.hydro.mb.ca/corporate/water_regimes/lake_wpg_regulation.shtml

• Grand Rapids Generating Station www.hydro.mb.ca/corporate/facilities/ gs_grand_rapids.shtml

• Lake sturgeon www.hydro.mb.ca/environment/projects/fish/ sturgeon.shtml

• Transmission & distribution www.hydro.mb.ca/corporate/facilities/transmission_system.shtml

• Transmission System Right of Way Tree Clearing & Maintenance www.hydro.mb.ca/projects/mb_mn_transmission/pdfs/right_of_way_brochure_final_2.pdf

• Agricultural biosecurity www.hydro.mb.ca/environment/env_management/biosecurity.shtml

• Call Before You Dig www.hydro.mb.ca/customer_services/permits_and_inspections/line_location.shtml

• Mobile Workforce Management https://www.hydro.mb.ca/NewsReleases/GetDetail?hdnAct=E&hdnTXT='Mobile%20Workforce%20Management%20system%20improves%20service%20for%20rural%20customers'

• White lining www.hydro.mb.ca/customer_services/permits_and_inspections/line_location/premarking.shtml

• Bipole III Construction Environmental Protection Plans www.hydro.mb.ca/projects/bipoleIII/environmental_protection.shtml

INDICATOR: Power Smart savings

25Demand Side Management

• Natural gas transmission and distribution system www.hydro.mb.ca/corporate/facilities/manitoba_hydro_naturalgas.shtml

• Northwest Winnipeg Natural Gas Project www.hydro.mb.ca/projects/expansion/northwest_winnipeg/index.shtml

• Northwest Winnipeg Natural Gas Project Public Engagement www.hydro.mb.ca/projects/expansion/northwest_winnipeg/public.shtml

• Solar water heating systems www.hydro.mb.ca/your_home/solar_water_heating/

• Community Geothermal Program www.hydro.mb.ca/your_home/first_nations/index.shtml

• Pay As You Save (PAYS) Financing www.hydro.mb.ca/your_home/power_smart/pays/ index.shtml

• Forest Enhancement Program www.hydro.mb.ca/environment/forest_enhancement/index.shtml

• Employee Safety and Health www.hydro.mb.ca/careers/employer_of_choice/safety_and_health.shtml

• Canada’s Top 100 Employers www.canadastop100.com/national/

• Corporate Knights www.corporateknights.com/reports/2014-best-50/2014-best-50-results-14020615/

• Summer Student Program www.hydro.mb.ca/careers/student_opportunities/summer_employment.shtml

• Careers www.hydro.mb.ca/careers/index.shtml

• SaskPower Power Purchase Agreement www.hydro.mb.ca/corporate/electricity_exports/saskpower.shtml

• Manitoba–Minnesota Transmission Project (MMTP) www.hydro.mb.ca/projects/mb_mn_transmission/ index.shtml

• MMTP Public engagement www.hydro.mb.ca/projects/mb_mn_transmission/ public.shtml

• Development plans www.hydro.mb.ca/projects/development_plan/ index.shtml

• Needs for and Alternatives to (NFAT) www.hydro.mb.ca/projects/development_plan/nfat.shtml

• NFAT Multiple Account Analysis www.hydro.mb.ca/projects/development_plan/bc_documents/nfat_business_case_chapter_13_integrated_comparisons_of_development_plans_multiple_account_analysis.pdf

• Northern Purchasing Policy www.hydro.mb.ca/selling_to_mh/northern_purchasing/index.shtml

• Smart grid strategy www.hydro.mb.ca/corporate/facilities/smart_grid.shtml

• Power Smart for your home www.hydro.mb.ca/your_home/power_smart/index.shtml

• Power Smart for your business www.hydro.mb.ca/your_business/power_smart_ business.shtml

• Power Smart Plan www.hydro.mb.ca/regulatory_affairs/electric/gra_2014_2015/pdf/appendix_8_1.pdf

• E Source Award https://www.hydro.mb.ca/NewsReleases/GetDetail?hdnAct=E&hdnTXT='Manitoba%20Hydro%20Wins%20Conservation%20Award%20for%20Top%20Performance%20in%20North%20America'

In an effort to reduce the costs associated with reporting and to reduce our environmental footprint this report is available only in an electronic format. No print copies are available.

The Sustainable Development Report is published by:

Manitoba Hydro 360 Portage Avenue Winnipeg, Manitoba, Canada R3C 0G8

Phone: 204-360-3311 Email: environment@hydro.mb.ca For more information visit www.hydro.mb.ca

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