Hydro One knows it has to prove itself to local residents who are concerned about its acquisition of Orillia Power’s distribution arm, the company CEO said Wednesday.
Mark Poweska, president and CEO of Hydro One, was at Orillia Power’s facility on West Street, a day after his company and the City of Orillia closed the deal.
Asked to respond to the skepticism some have about residents being better off with Hydro One, Poweska said: “We need to prove it.”
“We will demonstrate that we can offer an exceptional level of service and we can offer things that the smaller utilities can’t actually offer,” he said. “The one per cent reduction is part of that, but as we go forward, we’re going to demonstrate to customers that there are many other advantages of being part of the Hydro One customer base.”
He was referring to the one per cent rate reduction to the base distribution portion of customers' bills, which represents about 21 per cent of the overall bill. That reduction will begin with September bills and remain frozen at that rate for five years.
That amounts to an average savings of 20 to 30 cents per month, Poweska said.
“(It’s) not big, but the important thing to us is it’s frozen there, so as costs go up over the next five years and rates go up and things like that, customers in Orillia are protected from those increases,” he said.
When those five years have passed, subsequent increases will be less than inflation for the next five years.
What happens with rates after that is not yet known, as it will have to go back to the regulatory process before any changes can be made.
“Part of the regulatory process which led to the approval of this acquisition is that we had to demonstrate over the long term — 10-plus-year term — that customers were better off with Hydro One than they were with Orillia Power,” Poweska said.
All existing Orillia Power employees will have jobs with Hydro One, which has guaranteed them work in Orillia for at least a year.
“There are many more opportunities for employees of a larger company,” Poweska said. “If they want to go to other areas, if they want to go into other careers, we can offer that in Hydro One as well.”
The city sold Orillia Power Distribution to Hydro One for $26.35 million. The city retains Orillia Power Generation and will still receive an annual dividend.
Hydro One will build a provincial warehouse and a regional operations centre in the Horne Business Park in west Orillia, next to its Ontario Grid Control Centre that is now under construction. The control centre will employ an estimated 150 to 250 people.
“To the Hydro One employees who will be making their way to Orillia, you’re going love it here and you’re going love the quality of life,” said Orillia Mayor Steve Clarke.
The mayor praised the deal Wednesday, saying it’s been “a long and winding road to get to where we are today” — more than five years after initial talks began.
“Our citizens will have some wonderful employment opportunities for decades to come as one of the many economic benefits this project will bring to our area,” he said.
Clarke was also pleased with Hydro One’s commitment to invest $250,000 “to benefit the community.” He noted the company has already been supporting the Mariposa Folk Festival and the Ontario Winter Games, which were twice hosted by Orillia.
“When we join a community like Orillia, we believe that being a big part of that community is important,” Poweska said.
