Shock coming as Hydro purchases U.S. firm

It’s a pretty safe bet that power customers in the U.S. Pacific Northwest have no idea there’s a tsunami of incompetence headed their way.

Hydro One, the company that wrote the book on fumble-footed management, is spending more than $6 billion to buy Avista. It serves customers in Washington State, Oregon, Idaho, Montana and even Alaska.

Private interests own 51 per cent of Hydro One, However, Ontario taxpayers still hold 49 per cent.

You’ll remember Premier Kathleen Wynne sold off shares in the public utility to raise money to make her government’s books look better.

By the way, this is the same company that has been seeking approval for a rate hike. Just six weeks ago, the big dogs at Hydro One said they needed more money to fix a backlog of repairs. Public meetings on that issue were held around the province.

Among other disasters from Hydro One are smart meters that no one believes really work, at a cost of $2 billion.

A new billing system introduced a few years ago resulted in 10,500 complaints from customers. Some of these went more than a year without receiving any kind of an invoice. Around the same time the utility sent out 100,000 invoices that were incorrect, some of them spectacularly so.

So there’s little trust the utility is able take on anything new — such as buying another company — without snafus on a grand scale.

Back when Hydro One’s debt was creeping toward the value of its assets, customers were required to come up with more money each month to pay off this debt.

The billions used to buy into the U.S. instead could have paid back Ontario residents for that support.

Poor management at Hydro One isn’t a recent concern. In 1922, cabinet minister Dougall Carmichael quit a predecessor company because it “was either inefficient or dishonest.” He retracted the dishonesty remark, but the inefficiency tag remains today.

In the 1970s, controversy over Hydro’s expansion strategy resulted in several inquiries. These included the Porter Commission that recommended Hydro change its focus from capacity expansion to demand management. That recommendation was ignored.

Notwithstanding all of this, the big purchase is the subject of praise in the Toronto and Queen’s Park bubble.

“This marks a proud moment for Canadian champions as we grow our business into a North American leader,” said Hydro One president and chief executive Mayo Schmidt.

He said the purchase would move the firm into the continent’s Top 20 electricity companies. How that will help Ontario power users is anyone’s guess.

And then there was Energy Minister Glenn Thibeault who said the purchase will have no effect on electricity rates in the province.

That’s the same Thibeault who denied power poverty existed in Ontario days before his boss, Wynne, developed a strategy to deal with it. So his credibility is questionable at best.

Thibeault went on to say the purchase “is expected to deliver clear benefits for the company’s customers, employees and shareholders, including the people of Ontario.”

That comment, plus a buck fifty, will get you a small coffee if you shop carefully.