Questions and Comments

Question / Comment:

Why are your negative reasons so subjective? If you don't sell the value will just keep increasing. Why are huge funds lining up to buy utilities?

Response:

Utilities are seen as attractive investments today. We don’t know what the market or the Ontario government may have in store for the future. That’s why we’re doing some research now, and preparing for what may change.The information we’ve gathered so far is based on preliminary research, and previous utility consolidations across Ontario. For example:

According to page 23 of this report: Renewing Ontario’s Electricity Distribution Sector: Putting the Consumer First:

  • Veridian was created though the consolidation of the three neighbouring distribution utilities in Pickering, Ajax and Clarington. In the first three years of operation, Veridian reportedly achieved savings of 13% in operations management and administration expenses. Veridian Connections’ purchase of Scugog and Gravenhurst Hydro, 2005: As a result of the acquisition, the total cost of operating, maintaining and administering the combined utility decreased from $21.1 million to $18.8 million, an 11% reduction. This works out to savings of almost $40 per customer per year
  • PowerStream was created in 2004 with the voluntary merger of the distribution utilities of Markham and Vaughan and the acquisition of Richmond Hill’s LDC. That consolidation brought about $6.9 million in annual cost savings

Today, larger utilities like Powerstream, Enersource and Horizon offer services some smaller utilities may not (e.g. advanced energy mapping, outage management systems, smart-grid, smart home and smart city initiatives, electric vehicle charging stations, longer customer service hours, e-billing options etc.)

Visit the News and resources page to learn more about past utility mergers

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