Manitoba Hydro says it's already slashed its workforce and any further staff reductions would jeopardize customer service and public safety.
On Tuesday, the corporation received a letter from Crown Services Minister Colleen Mayer instructing it to scrupulously manage all operating costs, defer all non-critical capital projects and examine business plans for opportunities to achieve improved financial results.
Mayer said she also expected the corporation to "carefully examine overall staffing efficiencies," noting that government has already reduced its management staff by 15 per cent and its overall workforce by eight per cent, and Crown corporations are expected to do the same.
Hydro says it has already exceeded those staff reduction targets over the past two years, and it can cut no more.
"We believe that further staff reductions would significantly increase the risk of public and employee safety, of system reliability, and as well as our ability to provide reasonable levels of service to our customers," spokesman Bruce Owen said Wednesday.
In a recent presentation to the Public Utilities Board of Manitoba, in support of an application to boost electricity rates by 3.5 per cent, the corporation said it had decreased its staff by 872 positions, or 14 per cent, over the past two years.
Hydro said its staffing levels are comparable to what they were 15 years ago. But now it's serving 15 per cent more customers, managing additional facilities, coping with ever-aging infrastructure, and facing ever-increasing demands from regulators.
Weighing heavily on the corporation's bottom line in the coming year is the impact of the $8.7 billion Keeyask Generating Station, which is expected to come into service, in stages, beginning in October 2020. Once that happens, Hydro will begin to feel the burden of financing and depreciation costs on its annual operating budget.
The corporation estimates the added annual carrying costs from Keeyask and the recently completed Bipole III power transmission line to be in the $600 million to $700 million range. Hydro also told the PUB that there's a chance it will incur interest costs from Keeyask sooner than projected, as the generating station "may" come into service earlier than scheduled.
Meanwhile, it's unclear why Mayer asked Hydro to reduce management and overall staffing when it had already exceeded the government's targets.
All the minister would say Tuesday, when questioned about her mandate letters to Crown corporations, is that she expected Hydro to continue to evaluate staffing needs as vacancies occur.