Power is leverage against tariffs: Kinew

WINNIPEG — Manitoba is prepared to use its hydroelectric power as leverage in Canada’s trade war with the U.S., Premier Wab Kinew said Thursday.

The province could slap a 25 per cent charge on Manitoba Hydro exports to the U.S. by Monday, just as Ontario Premier Doug Ford has threatened to do with that province’s power exports, Kinew told reporters.

“The reality is that we are an energy power as a province,” the premier said. “We don’t want to do this in an irresponsible fashion, but the reality is that we are being threatened by a very unjust tariff from the Trump administration.”

He said Manitoba’s power is its leverage to protect jobs, the province and the country.

On Tuesday when the U.S. levied tariffs on Canadian exports — 10 per cent on energy and 25 per cent on other products — the minister responsible for Manitoba Hydro ordered the board of the Crown corporation to review any new major purchases or export contracts to the U.S.

“Manitoba is concerned about energy security and reliability as an economic priority, combined with the impact of tariffs being imposed by the government of the United States,” the directive by Finance Minister Adrien Sala directive says.

“Manitoba wishes to ensure that a high level of scrutiny and oversight are applied to major power purchase or export contracts with any party or parties in the United States.”

The minister directed Manitoba Hydro to seek the approval of cabinet before entering into any new major power purchase or export contract, before renewing, extending or declining to renew or extend any existing purchase or new major power purchase or export contract, or terminating any existing or new major power purchase or export contract with customers in the U.S.

Manitoba Hydro’s power exports brought in more than 22 per cent of its total electric revenue from 2010 to 2019, or about $3.9 billion.

It has several U.S. customers, including in Minnesota and Wisconsin. It has deals with Northern States Power (part of Xcel Energy) that were signed in 2010 to supply up to 850 MW of hydroelectric power each year until 2025. Last summer, it signed two five-year agreements with Northern States Power that are to start May 1.

Manitoba Hydro board chairman Ben Graham was not available for comment Thursday.

“Given how the tariff situation keeps changing, we’ll hold off attempting to answer questions until there is more certainty about what is actually happening,” spokesman Peter Chura said in an email.

It wasn’t clear whether a 30-day exemption on some tariffs reported Thursday would include the 10 per cent tax levied on Canadian energy.

“I don’t think anyone’s super clear on the back and forth and the whiplash-inducing game of Pong that seems to be the tariff policy of the Trump administration,” Kinew said.

“The fact that (energy) was to be tariffed at a different level shows that we have leverage — for us as a province and us as a country.

“The way you take on a bigger opponent is by using leverage effectively.” It requires Canadian unity and “to have the back of one another across the country.”

That’s why his government on Thursday introduced a “Buy Canadian” bill in the Manitoba legislature, the premier said.

“We were thinking ‘Buy Manitoban’ at first but, given all the progress we’re making on interprovincial trade and the priority around that, we figured let’s go in the ‘Buy Canadian’ direction.”

Bill 42, the Buy Canadian Act (Government Purchases Act amended) would establish a buy-Canadian policy, where “preferential treatment may be given to Canadian suppliers when making government purchases.”

Meanwhile, Manitoba is not backing down on its counter attack in the trade war — even if the U.S. dangles 30-day tariff exemptions, the premier said.

“A reprieve until April 2 is not good enough. We’re insisting all threats of tariffs be dropped,” Kinew said during question period. Until that happens, American booze will stay off of Liquor Mart shelves, the premier said.

The province continues to offer a 90-day payroll and retail sales taxes deferral for Manitoba businesses affected by the American trade sanctions, he said.

“We’re standing up for Manitoba. This is a time for us to rally around the flag.”

Progressive Conservative interim Leader Wayne Ewasko said the premier needs to tell Manitobans how the government plans to protect their businesses and jobs during the trade war.

“Besides no Coors Light, a 90-day (tax) referral and wrapping himself in a Canadian flag, the premier has so far kept details of Manitoba’s potential plan for tariffs a secret,” Ewasko said during question period.

“The premier promises to support businesses and help individuals hurt by tariffs, but refuses to tell them how.”

» Winnipeg Free Press