Staff
Ontario is undertaking a review of the province’s electricity sector and will explore options to improve efficiencies, including local distribution company (LDC) consolidation.
While it’s far too early to know what that could mean for the Fort Frances Power Corp., Mayor Roy Avis said he’s not in favour of the possibility of consolidation happening here.
“To my knowledge, our utility is not for sale,” stressed Mayor Avis, who also sits on the FFPC board.
He noted a province-appointed panel is expected to report back to the minister of energy within a year with its findings, and noted there’s no telling what the results of the review will be.
But as far as the mayor is concerned, he would not support a recommendation to sell the local utility.
“I don’t it’s a good idea for us to even consider that,” he remarked.
“Our utility functions very well the way it is,” he added. “I definitely would not be interested in seeing us going down that path.”
FFPC president and CEO Joerg Ruppenstein agreed it’s far too early to guess what could come out of the review.
“This is all still very high level,” he said. “At this point, it’s all speculation.”
As indicated in the 2012 budget, the province will do an independent benchmarking of electricity agencies to continue to drive efficiencies.
This study will get underway immediately.
The province also will launch an Ontario Distribution Sector Panel, which will consult with municipalities, LDCs, the Electricity Distributors Association, and other energy experts on potential long- and short-term financial savings associated with consolidation, benefits for ratepayers, long- and short-term operational efficiencies, and potential risks.
The panel will report back to the minister of energy within a year.
Earlier this year, the Commission on the Reform of Ontario’s Public Services, led by economist Don Drummond, recommended that Ontario continue to drive efficiencies in all electricity agencies.
In a press release dated April 13, the Electricity Distributors Association (EDA), which includes all 77 of Ontario’s local electricity distributors, said it is encouraged to see the government has listened to its recommendation to take a hard look at the entire electricity system through a review of its various agencies and the broader sector.
The EDA has been calling for a broadly-based review of Ontario’s electricity sector since last year, it noted.
In the press release, EDA president and CEO Charlie Macaluso said he supports the review.
“If you’re serious about finding savings for customers, you need to be look at each of the players and how they interact with each other,” he argued.
“We’re pleased to see that the government has taken our advice to examine all facets of Ontario’s electricity system, and we’re eager to share our ideas on how to make the system work better,” said EDA chair Max Cananzi.
The EDA’s report, entitled “Electricity is the Answer” and released in 2011, called on the provincial government to:
•take an arm’s-length approach to the electricity industry and its regulatory agencies to promote efficiency and more effective decision-making;
•change regulations that prevent local electricity utilities from providing other utility services;
•take an evolutionary approach to making change within the electricity system (consolidations should be voluntary and supported where they serve the best interests of customers);
•consider merging the Independent Electricity System Operator and the Ontario Power Authority, or rationalizing their responsibilities;
•reform electricity distribution regulation to allow utilities to better invest in system repair and upgrades; and
•allow local utilities the flexibility to design and deliver conservation programs that meet their customers’ needs.
