Scanned, recopied or Internet copy, if there are errors, please e-mail me with corrections: Opening comments: More at the end. National Post - April 11, 2008 - By Natalie Alcoba. Calls grow for Toronto to sell power utility As Mississauga takes its first steps toward the possible sale of its power utility, there are fresh calls for Toronto to consider doing the same. “If you look at other cities, Chicago, which we always like to compare ourselves to, has a privately run utility company. So does New York. So does Boston,” said Denzil Minnan-Wong, councillor for Don Valley East. He said the city should “seriously” look at selling part or all of Toronto Hydro, and he urged Mayor David Miller to bring to council a report by a blue-ribbon panel he convened in the midst of the city’s last budget crunch. The report calls on the city to study the sale of such major capital assets as Toronto Hydro and the Toronto Parking Authority. A spokesman for the Mayor said yesterday there are no plans to sell the power utility. “When cities are strapped for cash and for the investment needed to invest in infrastructure, they need to look at all the assets that they’ve got, and see if those assets are deployed in the best possible way,” Paul Massara, a member of the panel that produced the report, said in an interview. “Certainly, when we looked at Toronto Hydro we felt it was an asset that needed to be looked at in terms of whether that was the best use of the capital they had tied up in that... I think we’re still expecting them to do that.” Mississauga councillor Carolyn Parrish said she and her colleagues are reaching the same conclusion. On Wednesday, Mississauga council — minus Mayor Hazel McCallion, who was on a trade mission in Asia — voted unanimously to spend $162,500 to get its majority stake in Enersource appraised, and to hire consultants to canvass the market for prospective buyers. “We did not vote to sell Enersource, I want to make that clear,” councillor Pat Saito, who chaired the meeting, said yesterday. However, given that Mississauga is running out of money to maintain its infrastructure and Enersource is not making as much money as council would have hoped ($7- to $8-million a year), Ms. Saito said the city is exploring its options. “For the province to be setting the [electricity] prices pretty much makes us tailor’s dummies,” Ms. Parrish argued. “We can’t deliver cheaper rates to our folks because we don’t set them. I mean, why would we own a gas station if we can’t set the price of gas?” Mississauga has until Oct. 31 to sell its 90% share to Borealis, the investment firm of the Ontario Municipal Employees Retirement System that owns the remaining 10%, or to sell to another public utility company, tax free. The City of Toronto owns 100% of Toronto Hydro, which sells power to nearly 680,000 clients. “If we have an underutilized asset where there is value, there is an opportunity to turn that value into concrete and meaningful benefits to the residents of the city of Toronto,” said Mr. Minnan-Wong. The money from a sale could build more swimming pools and ice rinks and fix “crumbling infrastructure,” he said. “I would argue it should go to pay off our debt because the interest that we pay on our debt is our fastest growing budget pressure on our operating budget. This year it was over $500-million,” said Councillor Karen Stintz (Eglinton Lawrence), who supports a partial sale. Councillor Michael Walker (St. Paul’s East) said selling Toronto Hydro would be “penny wise and pound foolish.” He said Toronto Hydro makes the city about $60-million a year and, as an owner, the city has “greater authority” to comment on regulatory matters that affect consumers. “I’m not sure you need to give up control, if that’s the big issue,” Mr. Massara said. He pointed out that Toronto Hydro is “incredibly independent,” with only two Toronto city councillors sitting on its nine-member board and virtually all of its practices set by the Ontario Energy Board and the Ontario Power Authority. Home Page - Main Table of Contents - Back up a page - Back to Top [COMMENTS BY DON B. - ] |
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