ON THE DE­FENCE Premier Ford in­sists he’s not to blame for U.S. reg­u­la­tors zap­ping Hy­dro One’s takeover of Avista Corp. — which will cost On­tario mil­lions in a kill fee

De­ci­sion may cost On­tario tax­pay­ers mil­lions of dol­lars

The Niagara Falls Review - - Front Page - ROBERT BEN­ZIE

TORONTO — Premier Doug Ford in­sists he’s not to blame for U.S. reg­u­la­tors zap­ping Hy­dro One’s $6.7 bil­lion takeover of Avista Corp., which will cost On­tario tax­pay­ers tens of mil­lions in can­cel­la­tion fees.

In his first pub­lic state­ment since Wash­ing­ton state re­jected the On­tario util­ity’s pro­posed takeover of Avista cit­ing po­lit­i­cal med­dling by Ford’s gov­ern­ment, the premier was un­re­pen­tant.

“Upon as­sum­ing of­fice we acted de­ci­sively to keep our prom­ise to On­tario vot­ers,” Ford said Thurs­day, re­fer­ring to his de­ci­sion to get rid of Mayo Sch­midt, the Hy­dro One CEO he de­rided as the “$6-mil­lion man” for his hefty salary.

“I will never apol­o­gize for keep­ing my prom­ises to the vot­ers. We are re­duc­ing hy­dro rates and, af­ter years of ne­glect, fi­nally putting the ratepayer first,” the premier said.

En­ergy Min­is­ter Greg Rick­ford, mean­while, ap­peared to be hold­ing out hope that the deal could some­how be sal­vaged.

“That was one of three reg­u­la­tory bod­ies’ de­ci­sions and that is not an ex­pected out­come. Hy­dro One and Avista are re­view­ing that de­ci­sion and con­sid­er­ing their op­tions,” Rick­ford told the leg­is­la­ture.

Out­side the house, the min­is­ter re­jected the sug­ges­tion that po­lit­i­cal in­ter­fer­ence scut­tled the bid. “I’m not sure that’s what the de­ci­sion said,” he said.

Ford em­pha­sized that the set­back “doesn’t change our fo­cus on bring­ing down hy­dro rates and pro­tect­ing the peo­ple of On­tario.”

“This is a deal that was put to­gether by the for­mer board and for­mer CEO of Hy­dro One — a deal that did noth­ing to lower hy­dro rates for On­tario res­i­dents,” the premier said, ad­ding ratepay­ers should not “take a back seat to for­eign reg­u­la­tors.”

“Our gov­ern­ment ran on a clear prom­ise to clean up the mess at Hy­dro One. This in­cluded a firm com­mit­ment to re­new the Hy­dro One se­nior lead­er­ship that had lost the con­fi­dence of On­tario ratepay­ers. The peo­ple of On­tario elected us to fol­low through on this prom­ise,” he said.

The Wash­ing­ton Util­i­ties and Trans­porta­tion Com­mis­sion (UTC) said the $6.7-bil­lion deal was not in the pub­lic in­ter­est be­cause it was “ev­i­dent” de­ci­sions im­pact­ing Hy­dro One were in­flu­enced by “po­lit­i­cal con­sid­er­a­tions” in On­tario.

Sch­midt’s de­par­ture was fol­lowed by the res­ig­na­tion of the en­tire board, which state reg­u­la­tors said sug­gested On­tario was will­ing to put po­lit­i­cal in­ter­ests above those of share­hold­ers. The can­cel­la­tion deal will re­sult in Hy­dro One pay­ing a $103-mil­lion kill fee plus un­told mil­lions in lost share value since the prov­ince owns the largest stake in the util­ity.

In a joint state­ment Wed­nes­day, Hy­dro One and Avista, which serves 400,000 elec­tric and nat­u­ral gas cus­tomers in eastern Wash­ing­ton, said they were “ex­tremely dis­ap­pointed” in the de­ci­sion.

The UTC warned the risk of Ford’s gov­ern­ment in­ter­fer­ing in Hy­dro One’s af­fairs was “sig­nif­i­cant.”

“This, in turn, could di­min­ish Avista’s abil­ity to con­tinue pro­vid­ing safe and re­li­able elec­tri­cal and nat­u­ral gas ser­vice to its cus­tomers in Wash­ing­ton,” the reg­u­la­tor said.

Hy­dro One is 47 per cent owned by the On­tario gov­ern­ment af­ter for­mer Lib­eral premier Kath­leen Wynne con­tro­ver­sially sold off a ma­jor­ity share of the util­ity. Both Ford’s Pro­gres­sive Con­ser­va­tives and An­drea Hor­wath’s New Democrats op­posed the Lib­eral sell-off. But Hor­wath blasted the Tories for their “bum­bling” in the elec­tric­ity sec­tor.

“The Wash­ing­ton state reg­u­la­tors were pretty clear: This is a gov­ern­ment that does what­ever they want, when­ever they want — and they can’t do busi­ness with peo­ple like that,” she said.

STEVE RUS­SELL/TORONTO STAR

Premier Doug Ford said Thurs­day he would “never apol­o­gize” for keep­ing his prom­ise to the vot­ers af­ter he got rid of of Hy­dro One CEO Mayo Sch­midt.

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