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McDonald says no to the sale of LDCs

Friday, December 14, 2012   by: Kate AdamsMayor Al McDonald
News Release

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The panel to review the Ontario Distribution Sector Review released its report and submitted it to the Minister. The report recommends the consolidation of local distribution companies (LDCs) such as North Bay Hydro. The report has recommended consolidating 73 LDCs to 8 to 12 larger regional distributors. That includes only one distribution centre in the northeast. The consolidation is to be completed within 2 years on a voluntary basis. If this is not done and there is no action in the first 9 months, then it is recommended that legislation be tabled to compel consolidation.

“Our city is well served by North Bay Hydro.” Mayor Al McDonald stated “From a business perspective, they can respond quickly to meet the needs and challenges of our employers. This is important for economy development reasons including job creation. The Minister has yet to comment on the report but it is important for our residents to understand the consequences should this move forward. The report did not review the 80 to 95 percent of the total bill, only the small portion by local LDCs.”

Currently, North Bay Hydro serves approximately 21,000 residential customers and 2,800 businesses. When North Bay Hydro is compared with other LDC centres, they are ranked 8 out of 75 LDCs for efficiency. Under present conditions, approximately 80 to 95 percent of all electricity costs on a monthly bill are costs controlled by the Province. (LDCs) control 5 to 20 percent of the bill. The rates paid by North Bay Hydro customers are on average 40 to 55 percent lower than Hydro 1 users.

“I believe that if the government moves forward with this recommendation, then it should be on a voluntary basis only,” stated Mayor Al McDonald. “How can this panel state it is voluntary when legislation forcing mandatory consolidation after 9 months would be tabled? Our utility continues to serve our citizens and businesses very well. I can’t imagine we would get the same service if North Bay Hydro is consolidated to Sudbury. The Minister should consider voluntary consolidation only. I do not support the selling of this asset and it would be irresponsible to be forced to do so.”

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