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Plan to sell Hydro One 'short-sighted': CUPE

The province's plan to sell 60 per cent of Hydro One is a “short-sighted” decision that will negatively impact local electricity distribution companies like Sudbury Hydro, said the president of CUPE Ontario in a public meeting opposing the plan Wedne
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CUPE Ontario president Fred Hahn said during a public meeting at the United Steelworkers Hall that the province's plan to sell 60 per cent of Hydro One is a “short-sighted” decision that will negatively impact local electricity distribution companies like Sudbury Hydro. Photo by Jonathan Migneault.
The province's plan to sell 60 per cent of Hydro One is a “short-sighted” decision that will negatively impact local electricity distribution companies like Sudbury Hydro, said the president of CUPE Ontario in a public meeting opposing the plan Wednesday night.

“This is such a bad idea, and so short-sighted,” Fred Hahn said as he implored a crowd gathered at the United Steelworkers Hall to oppose the planned sale of Hydro One.

Ontario Premier Kathleen Wynne has said her plan to sell 60 per cent of Hydro One in an initial public offering would raise around $4 billion to help fund the province's $130 billion infrastructure plan over 10 years.

But the amount raised from the sale would only cover three per cent of the infrastructure plan, said Nickel Belt MPP France Gélinas at the meeting.

In his speech Wednesday Hahn said hydro rates have already increased by 300 per cent over the last 15 years, thanks in large part to privatization in power generation.

Because private companies have an obligation to make money for their shareholders, he said, they decrease the quality of their services and raise costs to increase profits.

But during a visit to Sudbury last week, Ontario Energy Minister Bob Chiarelli said that selling Hydro One would not increase hydro rates, because those are regulated by the Ontario Energy Board.

“Hydro One doesn't control its own rates,” Chiarelli said. “The existing government agency does not set its own rates, nor will it set its own rates as a private sector company.”

He added the Ontario Energy Board already regulates the natural gas sector, which includes private corporations like Enbridge and Union Gas.

“It is an effective regulatory agency,” he said. “It already works with the private sector in the gas sector and will continue to do so in the future with the electricity sector.”

But Hahn said the Ontario Energy Board does not have a mandate to set hydro rates. It simply approves or rejects requests for rate changes.

And under private ownership, he added, Ontario Hydro's board would push for more rate increases to ensure investors get a return on their investments.

Privatizing the distribution system could also put projects like the Ring of Fire at risk, he said, because a privatized Hydro One would be less likely to build expensive transmission lines remote regions of Northern Ontario without a clear return on investment.

“They won't do it as a matter of public policy, like the way we could do it if the government controlled hydro,” he said.

Paul Moist, CUPE's national president, was also at the public meeting and said the decision to privatize Hydro One has gained “unprecedented” opposition from the province's most senior civil servants.

Last week, Ontario’s nine senior public accountability officers, including the auditor general, the ombudsman and the financial accountability officer, submitted a letter to the government stating that privatizing hydro would eliminate their authority to assess the value and quality of service the utility provides to the Ontario public.

“Why are we just hearing about this?” Moist asked. “Why are there no consultations in Northern Ontario?”

The province's omnibus Bill 91, an act to implement budget measures, would give the government the green light to sell up to 60 per cent of Hydro One.

It is scheduled to be debated for four days in Toronto.

Gélinas said she encourages the public to oppose the bill.

“If enough people go in the same direction the government will have to follow,” she said.
A poll conducted by Environics Research, and commissioned by CUPE, found 84 per cent of Sudbury residents oppose plans to privatize Hydro One.

For the poll Environics Research conducted an interactive voice response to phone 975 Sudbury residents on May 13. The results were weighted by age and gender to reflect the demographic makeup of Sudbury. The results have a margin of error of plus or minus 3.1 percent, 19 times out of 20.

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Jonathan Migneault

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