SaskPower returns to profit as it releases 2023-24 annual report

After a previous year with a big loss for SaskPower, the Crown Corporation is back in the black for 2023-24.

On Tuesday, the company’s annual report explained a $184 million net income — a $172 million loss in 2022-23. The $356 million difference was largely due to lower fuel costs and a $312 million rise in revenue thanks to electricity sales.

The company says sales are now above $3 billion, due in part to a four per cent system-wide rate increase, a 0.5 per cent increase in the carbon levy and a nearly two per cent increase in sales volumes, mostly because of industrial and oil field customers.

Crowns Minister Dustin Duncan said there is no plan for SaskPower to ask for another rate increase any time soon. However, he says there will eventually be because of carbon tax and rate increases will be needed because of SaskPower’s capital and infrastructure needs.

SaskPower spent $1.213 billion on capital investments in 2023-24, which is near a record. That number includes $520 million for repairs and upgrades to aging generation, transmission and distribution infrastructure, and $621 million for growth like new facilities and expanding capacity.

The company collected $269 million on the carbon charge, which is $59 million more than the previous year. The carbon tax is no longer paid to the federal government. The money is now collected by a Saskatchewan program and is used on energy projects in the province.

SaskPower is no longer charging the carbon tax on home heating to customers, but the company is still paying the amount. It has cost SaskPower $1.3 million for the first three months of 2024.

Duncan said it’s a small number of customers and a smaller dollar amount than SaskEnergy and, in SaskPower’s case, the money is staying within the province’s system.

“It stops the federal government coming and looking to renegotiate the agreement that we do have between the federal government and the province for those dollars remaining in the province,” said Duncan.

The report explains SaskPower’s goal is to reduce its greenhouse gas emissions by 2030 to half of what they were in 2005 and to net zero by 2050 or earlier.

However, in 2023-24 the reduction was only at four per cent – the target was eight per cent. A big reason the company managed to improve that from the three per cent the year before was a 0.9 per cent drop from the emergency shutdown of the Poplar River Power Station for nearly three months.

“We’re confident that we can hit that goal by 2030 and then, ultimately, be net zero by 2050 or sooner than that,” said Duncan.

The rate of emission reduction is expected to increase as more of the province’s coal-fired plants are retired and renewable generation projects like wind and solar power come online.

In the company’s financials, SaskPower added $579 million of debt, to bring its total debt to $9.407 billion. The Crown’s debt ratio hit 74.4 per cent, which is below the 75 per cent targeted ceiling.

The Crown paid an $18 million dividend back to the province, about 10 per cent of its net income, a rate which was set by the Crown Investments Corporation.

Duncan admitted that is a lower percentage than other crowns but defended the level.

“We felt it was a way for power to contribute to the overall goals of the province while also maintaining a healthy financial position,” explained the minister.

SaskEnergy income is lower but back to expected levels

SaskEnergy released its 2023-24 annual report Tuesday afternoon, showing a $55 million net income before unrealized market value adjustments.

That number is down from the $126 million the year before, but SaskEnergy said 2022-23 was high and this year’s earnings are more in line with expected levels.

The company paid $21 million to the province in a dividend for the year.

In the 2023-24 year, SaskEnergy invested $171 million in what it calls “system expansion and reliability initiatives,” including expansions in the Melfort and Regina areas.

SaskEnergy, like the other Crowns, is working on its environmental footprint with things like installing solar arrays to reduce its electricity needs. In the past year, it reduced its CO2 equivalent emissions by 8,000 tonnes.

The company is now at a 17 per cent reduction from emissions in the 2019 baseline year, about halfway to its goal of a 35 per cent reduction by 2030.

The 2023-24 year is when the provincial government took responsibility for the carbon tax payment. SaskEnergy stopped charging and it stopped remitting the carbon tax on home heating to the federal government.

This didn’t have an impact on the company’s financials as those monies flowed through SaskEnergy.

SIGA sees record-breaking profits in annual report

The Saskatchewan Indian Gaming Authority was the third Crown to release its annual report on July 9.

It showed $346.6 million in gross revenue in 2023-24, $43 million more than the year before.

The results also showed $138.8 million in final distribution of income, $12 million more than the year before.

This is the second year in a row SIGA has shown record-breaking profits.

SIGA’s financials show $148 million in net revenue from slot and online gaming last year, compared to $133.8 million in 2022-23. Online gaming was $4.975 million in 2023-24, a big increase from the $31,712 in the year before when online gaming was just introduced.

SIGA also made $37.45 million in revenue from table games and ancillary in 2023-24, compared to $26.26 million the year before.

The company is attributing the increase to a $7.8 million year-over-year growth on the casino side, and a $4.9 million growth on the online gaming side.

The report says PlayNow.com has more than 30,000 clients, and 50 per cent of the customer base in Saskatchewan comes from rural communities outside Regina and Saskatoon.

“SIGA has successfully built back from the pandemic, achieving record-breaking revenues over the past 24 months, all the while, making major strides in enhancing our casino properties and offerings and growing our online gaming platform PlayNow.com in Saskatchewan,” said SIGA President & CEO Zane Hansen in a news release.

The money SIGA makes gets put back into Saskatchewan – net revenue from the casinos are redistributed 50 per cent to the First Nations Trust, 25 per cent to the Community Development Corporations and 25 per cent back to the provincial government’s General Revenue Fund.

Editors Note: This file was updated on July 9 at 3:30 p.m. to include the update on SaskEnergy and SIGA.