Winnipeg’s major sewage treatment project could now exceed $2 billion due to excessive inflation and an order to fast-track a key part of the project.
A new report from the city estimates that the costs of the Northern Wastewater Treatment Plant project are overflowing again, this time by $360 million. The upgrades are being done in three phases to increase capacity and reduce pollution destined for Lake Winnipeg.
“I will have questions when this report comes in. I mean it’s a huge cost increase,” said councilor Brian Mayes.
Total costs had been set at $1.8 billion. However, the report states that the second phase of the project could grow from $552 million to $912 million, a peak of $360 million.
The city blames this in part on excessive inflation and financing costs and a delay in the province’s funding request for federal money.
“Years of delay by the former premier didn’t help,” Winnipeg Mayor Brian Bowman said Thursday.
In a statement, the province said it was analyzing the city’s most recent report.
“There have been no delays in provincial approvals, and we remain committed to working with the city on collaborative options to ensure our waterways are cleaned up as quickly as possible,” the statement said.
The report also says a new requirement by the province for the city to fast-track an aspect of the phosphorus removal project, which causes algae blooms, is also driving up costs.
“If we want to remove phosphorus faster, it comes at a cost,” Mayes said. “I think it’s money well spent.”
The Lake Winnipeg Foundation agrees.
“I’m thrilled. I was so excited to read this report,” said Alexis Kanu, executive director of the foundation.
Kanu said that by pushing this element of the project up, it might actually save money overall.
“The most costly element of this process plant upgrade is time,” Kanu said. “So the longer we wait to put these critical environmental protections in place, the more expensive they become.”
The city is awaiting news from Ottawa on the phase two funding request. Premier Heather Stefanson announced late last year that it was being forwarded to Ottawa.
The city’s utility is asking that the matter be referred to the 2024 budget process. In the meantime, it says it will look at ways to cut costs, including seeking additional funding sources.