The Government of Manitoba announced legislation that would increase Manitoba Hydro’s short-term borrowing limit.

Crown Services Minister Jeff Wharton said that Hydro will have the opportunity to save Manitobans money by updating their financial investments.

“This long-overdue change will save ratepayers up to $41,000 a day in interest,” said Wharton.

The current loan limit of $500 million was established in 1992 and hasn’t been looked at in 27 years. Since then, Hydro’s asset base has grown substantially with major capital projects like the Bipole III transmission line, and the Manitoba Minnesota Transmission Line.

Wharton said that the current borrowing limit is undersized relative to Hydro’s current and future needs. Increasing the short-term borrowing limit to $1.5 billion would help capital projects in various stages of construction where a loss of funding would cause a delay in the project.

Events like the October snowstorm has put forward the need for increased emergency funding. The final damage bill from the storm for Hydro is estimated to be in $100 to $120 million range.

The loan could potentially reduce annual costs for Hydro customers by between $8 and $15 million, depending on market conditions and cash balances.

The loan increase would also bring Hydro more in line with utilities in the country. B.C. Hydro’s loan limit is $4.5 billion and SaskPower’s loan limit is $2 billion.

The government says the move shows their commitment to fixing the province’s finances and helping save Manitobans money by shopping smarter.

Wharton added that by changing Hydro’s short-term borrowing limit, the cost for ratepayers to service Hydro’s debt will be reduced.