Sale will improve Hydro One, Clark insists
Ed Clark, chair of the Premier's Advisory Council on Government Assets. (Michael Peake/Toronto Sun)
The banker advising the Kathleen Wynne government on the partial sale of Hydro One insists the deal will lead to a better-run company that’s able to pass savings onto its customers.
The Association of Major Power Consumers in Ontario (AMPCO) — heavy industrial users of electricity — told the Sunday Sun that the hydro customer was ignored in the plan to sell off a majority stake of the public utility to help pay for transit and other infrastructure.
AMPCO, and many other organizations, have raised concerns that already high hydro rates will increase.
Ed Clark, chair of the advisory council that recommended an initial public offering (IPO) for Hydro One, spoke to the standing committee on finance and economic affairs Tuesday.
The former TD banker told reporters following his appearance that he spent more than two decades running a private company that started and ended with customers.
There’s no reason to believe that Hydro One would provide worse service and higher rates with private partners, he insisted.
“So, do I believe this company with a diluted ownership of the government will be better for the customer? Absolutely without question because it will be run better and when it’s run better, its costs are less and those costs are automatically by law passed on to the ratepayers,” Clark said. “So why is that not a good thing to have lower rates?”
Energy analyst Tom Adams, who also appeared at the committee, said Clark’s narrow view of the Hydro One sale does not consider the financial hole left behind when the provincial government takes $4 billion and a sizeable chunk of the utility’s future revenue stream out of the electricity system.
That revenue will not be available to pay off the system’s existing debt managed by the Ontario Electricity Financial Corporation (OEFC), he said.
“It’s filling the hole that he’s creating at OEFC that results in the rate increase that he’s not talking about,” Adams said. “This is a shell game.”
Several unions and both opposition parties — the NDP and Progressive Conservatives — are fighting the sale of Hydro One.