Manitoba’s provincial government held high-level discussions with international financial advisers last year regarding the development of a hyperscale artificial intelligence data centre and the revival of the multi-billion dollar Conawapa hydroelectric dam project, according to documents obtained by CBC News. While Premier Wab Kinew has since rejected the data centre proposal, citing concerns over electricity consumption and long-term economic benefits, the province remains open to exploring private capital partnerships for new energy infrastructure on the Nelson River.
Why did Manitoba consider a hyperscale AI data centre?
In October and November 2025, senior bureaucrats and deputy ministers met with officials from the financial firm Rothschild & Co. to evaluate the feasibility of a data centre requiring 250 to 300 megawatts of power. Documents show the province viewed Manitoba’s clean energy grid and “potential for fast-track permitting” as a distinct competitive advantage. According to meeting notes, officials were advised to move quickly to capture market interest, warning that the AI sector’s demand for such facilities might decline within 12 to 24 months. A facility of this scale is classified as hyperscale, requiring power equivalent to the needs of approximately 150,000 homes.
A data centre is considered “hyperscale” once it exceeds 100 megawatts of power consumption. These facilities are the primary infrastructure hubs for large-scale cloud computing and generative AI training models.
What happened to the data centre proposal?
Premier Wab Kinew officially shelved the hyperscale data centre plans last week, stating that the energy requirements were too high for the potential economic return. Kinew noted that following a “deep dive” into the sector, his government concluded that dedicating scarce megawatt capacity to these projects did not align with provincial interests. This shift comes as other jurisdictions, such as Saskatchewan, move forward with large-scale projects, including a 300-megawatt data centre near Regina announced by Bell Canada in March.
Is the Conawapa dam project back on the table?
The government is reconsidering the Conawapa generating station on the Nelson River, a project previously shelved in 2014 by the former NDP government when costs reached $10 billion. Rothschild & Co. pitch documents suggest the $18-billion to $20-billion project could be funded using private capital from pension funds like CPP Investments or Ontario Teachers’ Pension Plan to avoid impacting the provincial balance sheet. While Premier Kinew previously characterized the era of massive dam building as over, he now argues that the province must look at all financing options to meet future energy needs. Critics, including Tory Leader Obby Khan, have questioned the transparency of these private-partnership discussions given the Premier’s historical stance against the privatization of Manitoba Hydro.
Financial Risk and Infrastructure
The revival of the Conawapa project faces significant scrutiny due to Manitoba Hydro’s existing $25-billion net debt, exacerbated by the construction of the Keeyask generating station and the Bipole III transmission line. Mark Winfield, a professor at York University, warns that partnering with private entities risks the province losing control over essential infrastructure. Winfield notes that the previous economic case for Conawapa was deemed weak by the Public Utilities Board, suggesting that the financial risk remains substantial for taxpayers.
When evaluating large-scale infrastructure projects, focus on the “levelized cost of energy” (LCOE) and the long-term debt-to-equity ratio of the utility involved, rather than the immediate job creation figures often cited in project pitches.
Frequently Asked Questions
- Why is the Conawapa dam controversial? The project was shelved in 2014 because the projected costs were deemed too high and the electricity was not immediately required, raising concerns about the financial burden on Manitoba Hydro.
- What is a hyperscale data centre? It is a massive facility designed to support robust, scalable cloud and AI applications, typically consuming over 100 megawatts of power.
- Is Manitoba planning to privatize Hydro? Premier Kinew has denied plans for privatization, though opposition leaders have questioned why the government engaged in private-capital funding discussions for energy infrastructure.
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