'It's time to reconnect with the PUC'

It isn’t often ratepayers agree with the various levels of government or corporations, but this might be a first.

The Sault Ste. Marie Ratepayers Association (SSMRA) and Sault Ste. Marie PUC Inc. management officials met at the Civic Centre Wednesday evening and both are agreed that the City of Sault Ste. Marie as PUC Inc.’s sole shareholder, must let the provincial government know of their opposition against utility companies, like the Sault’s PUC, being amalgamated into huge, regionalized utility companies that service entire regions of the province.

The Drummond Report of February 2012 contained a long list of cost-cutting recommendations for the provincial government.

From there, a Distribution Sector Panel examined the Drummond Report and issued a recommendation in December 2012 that Ontario’s existing 73 utility companies be whittled down to between eight and 12 regionalized utility companies, with only two utility companies servicing Northeastern Ontario, including Sault Ste. Marie.

Utility Boards, like that of PUC Inc., would have minimal control over Sault Ste. Marie’s water and electricity matters.

PUC Inc. President and CEO Dominic Parrella said the panel’s recommendation that amalgamations take place over a six- to nine-month period is unrealistic.

The panel’s report also urges that if utilities fail to amalgamate within that six to nine month period, that amalgamations be forced by provincial legislation.

Parrella stated claims that significant savings would be made if new, regionalized utility companies were brought into being lack supporting evidence, adding that regional mergers would cost more because of the administrative costs involved in running new regionalized utility companies.

Parrella pointed out costs for utility customers across Ontario have actually gone up due to a decline in the number of utilities that occurred from privatization of Ontario Hydro by the former Progressive Conservative provincial government in 2000.

Ratepayers Association spokesman David Poluck told SooToday.com it is time to “reconnect with the PUC.”

“We’ve got to start spreading the word that this thing (regionalization) is coming. We have to coordinate our actions with the PUC.  We’ll be meeting with Frank Fata (City Councillor and PUC Board member) Thursday and contacting (Sault Ste. Marie MPP) David Orazietti.”

Poluck told us the Ratepayers group is considering conducting a public survey on the matter within the next few days.

When asked if the PUC has contacted the province with its’ concerns over the concept of regionalization of utilities, Parrella said the City of Sault Ste. Marie, as the PUC’s sole shareholder, will present its case against the recommendation.

"What we’ve done is we’ve advised our shareholder (the City) of this report,” adding the matter is on City Council’s agenda for its’ regular meeting on Monday, March 4.

"We’re recommending the City take action to advise the government of their concerns, especially forced amalgamations.  Amalgamations should be voluntary. In some cases amalgamations make sense, but they should be voluntary and driven by a solid business case, good for the shareholder and the customer.”

That is a view shared by the Electricity Distributors Association (EDA).

Parrella continued: “Forced amalgamation doesn’t work; it’s not based on a sound business case.”

Parrella said that so far, the governing Liberals and the opposition parties have given no indication they plan to move ahead with regionalization of water and electricity distribution.

However, Parrella added: “That doesn’t mean they, or a future government, may decide to do so in the future.”

Tweet