PUC merger with other companies unlikely, says chair

There are currently 65 Local Distribution Companies (LDCs, such as the Sault’s PUC) in the province, way down from approximately 300 in the 1990s.

The Ontario government is reported to be looking at amalgamations of utility companies to the point where there would eventually be only eight to 12 distribution companies in the province.

Will there be a day when calls for PUC customer service in the Sault be directed to, for example, a ‘northeastern Ontario region’ utility office in Sudbury?

“I can tell you that’s not being discussed.  Will it ever happen?  I really couldn’t forecast that one way or another,” said Jim Boniferro, chair of PUC Inc. and PUC Services Inc.

Boniferro said there is no current discussion of merging utility companies through legislation, in the same manner school boards were amalgamated and megacities such as Greater Toronto and Greater Sudbury were created through law during the Mike Harris years.

“There was the threat that it would be mandated, that the government would make a statement that said we are now 65 utilities and we are going to mandate that you get down to eight or 12.  We’re not hearing that tone from the government at this point.”   

Boniferro told SooToday the PUC, if anything, is open to ways it can expand its own reach into other communities.

“In the utility business there is a drive to innovation, and there is also a drive to mergers and acquisitions,” Boniferro said.

“Could service calls go through a location other than Sault Ste. Marie?  Possibly, but it’s also possible service calls from other communities could come to Sault Ste. Marie because we have the infrastructure, we have the technology, we have the people.”  

“We manage and deliver customer care and services for Espanola Hydro and have for a number of years . . . currently if you’re in Espanola and you call customer service you get a person in Sault Ste. Marie, we have that model now.”

“We think it’s more likely that customers in other locations would be calling Sault Ste. Marie than the other way around,” Boniferro said. 

“We want to improve customer service and grow our assets for our shareholder, the city of Sault Ste. Marie, so we’re asking are there other small utilities like Espanola that we as the PUC can provide service to?”

Boniferro said the PUC would not aggressively spend money on a business case to determine the benefits of merging with another utility, as Guelph city council has decided to do as sole shareholder of Guelph Municipal Holdings Inc.

That city will spend $250,000 on its business case, the entire process costing up to $1.5 million if it goes through with a merger with another utility.

“We believe there are ample ways of evaluating opportunities without being that formal and expending that kind of money,” Boniferro said.

“We are very sensitive to the bill impact.  We only represent 18 per cent of that total electricity bill, the rest of it is government-driven charges, but we recognize our 18 per cent is a part of that bill.”

“We have to be very diligent where we spend our money and what investments we have the opportunity to make and at this time we don’t see it as prudent to invest in exploratory studies (to merge with other companies) . . . but as a board, we are looking for opportunities (to expand the PUC’s reach to other communities).”