Hydro One Privatization

As you may know, I have long been an outspoken advocate against both the exorbitant prices and other excessive charges Hydro One consumers are enduring, and more importantly, the tens of thousands of customers who have been receiving erroneous bills, no bills, outrageous estimated bills and disconnection notices due to substandard service, lack of diligence and carelessness by Hydro One.

As the Ombudsman office has stated, the level of complaints against this Crown Agency has reached epidemic and unprecedented levels. Poor customer service has only exacerbated the many problems at Hydro One.

With all this being known, there is more that concerns me with the Liberal scheme to privatize Hydro One.

The Liberals are proposing what effectively amounts to a Ponzi scheme; they are selling 60% of an asset that has a $30 Billion debt for approximately $9 Billion, while only retiring about $5 Billion of that debt. Ontario taxpayers will be left with $25 Billion in debt to repay and only a partial asset with a significantly reduced revenue stream to pay the interest, let alone the principal. Should any individual attempt to do this when selling their house or other property, they would be charged and probably found guilty of fraud or conversion of funds.

In addition, while the Ontario government has the lawful authority to dispose of the assets (buildings, transmission line etc.) of Hydro One, they do not presently have the legal or statutory authority to dispose or assign the shares (ownership) of Hydro One. Disposing or assigning the shares, even the offering of the shares prior to receiving statutory authority, would raise allegations of unlawful activity.  We have learned that the Wynne administration has offered shares of Hydro One to the Power Workers Union in lieu of increased pension benefits.

My personal view and opinion is that the electrical transmission corridors and distribution hubs (the system) ought to remain in public ownership and this will not be possible under the Liberal plan. However, as has been shown, the administration and billing is a picture of complete incompetence. I would propose that these administrative and management functions of Hydro One would be best sold to the private sector and run efficiently and competently. 

On a final note and which I often hear, is that we make the bureaucracy of Hydro One more efficient and less wasteful; I’m of the view that while this is a noble hope, it is an impossibility while Hydro One remains both a monopoly and under public ownership. There is one fact that helps to illustrate my conclusion:  In the past twelve years the amount of electricity Hydro One sells per year has not increased, however the number of employees employed by Hydro One has doubled in this same period. We are selling the same amount but with half the productivity and twice the payroll, along with extravagant wage and benefit increases since 2003.  

In summary, while I oppose the current scheme to sell off part of Hydro One, I will always keep an open mind towards any proposals that come forward that may improve the efficiency and effectiveness of the production and delivery of electricity in Ontario.

Showing 1 reaction

  • Catharine Burrell
    commented 2015-05-22 09:33:07 -0400
    Randy the first thing you need to do is put a great big resounding NO in front of your Hydro One Privatization title. As it is I pay over 2x the amount for my hydro bill as my friends who use the same amount kWh per day as my friends in Kingston. Wynne isn’t just robbing Peter to pay Paul Wynne and Hydro One are robbing rural to pay for city. Hydro rates are driving people out of their homes, businesses to close and to choose not to locate in Ontario. Wynne continues a policy of so called green energy where 1,000’s of acres of rural Ontario are being turned into eyesores with building projects that will leave tons of hazardous waste to be cleaned up when the facilities are no longer operating. When I asked about the decommissioning process for the wind turbines built on Millhaven Road the answer from the company engineer was that they would be sold to 3rd world countries because the technology was so advanced compared to what they had they would be happy to buy them. Now I don’t know about you but I think as a decommissioning process for a wind turbine that is taller then the stacks at the nearby hydro plant that seems a lot less then optimal. There is no oversight to protect the environment and the health of people near the “green” energy. The process is simply a rubber stamp to the Liberal’s green energy policy and is designed to make people feel used and abused and un-cared for. But, the the rural voters don’t matter as they weren’t the ones that elected the Liberals.

    Why should Ontario pay for a transportation system in Toronto??? I haven’t been to Toronto in almost a decade and I haven’t used the Toronto transit system since 1989 when I last lived at Bay and Wellesley. Of course the citizens who live in Toronto vote Liberal, the Liberals are making the rest of the province subsidize them. But, the sad really of economics is that a few can’t pay for many unless the few are very, very, very wealthy. Drive through the country areas of this province now and you will see home after home with for sale signs at the road.

    As strange as it might seem to the Liberals, Ontario doesn’t actually end at the boarders of Toronto and their policies are killing us.

    You should ask people to send you copies of their hydro bills. My actual usage is currently 38.5% of my total bill. Remove the debt retirement and clean energy credit and my usage percentage of my total bill will drop to 35.6% of my total bill. Removing the debt retirement sounds great in theory but combining that with removing the clean energy credit will increase my bill not decrease it.

    Hydro One as it is now is not sustainable and selling it off is only going to make it more of a burden on the consumer. There is an old saying which says a new broom sweeps clean and I think that the time has come to do some sweeping changes.