Lights will stay on at Barrie's PowerStream operations centre

PowerStream, Enersource, Horizon Utilities and Hydro One Brampton will merge to become Alectra next month

Yorkregion.com
Jan. 18, 2017
By Chris Simon

PowerStream’s Patterson Road operations facility will be largely unaffected by the company’s merger with three other hydro utilities, president Brian Bentz said.

Bentz, who will become president and CEO of the newly formed Alectra - the long-anticipated merger of PowerStream, Enersource, Horizon Utilities and Hydro One Brampton - next month, confirms staffing levels at the Barrie facility will remain intact.

So what, exactly, does this week’s unveiling of Alectra mean to thousands of Simcoe County households? Well, the average hydro bill is expected to decrease by about $40 per year as merger efficiencies are achieved over the next decade. The change is also expected to improve system reliability.

Under Alectra’s new structure, the corporate head office will be located in Mississauga, with local utility operation centres in Barrie, Markham and Brampton. There will be a roughly 17 per cent reduction in costs achieved in the merger, and most of that will be through technology streamlining and workforce attrition.

“It really is about the benefits of consolidation for customers,” he said, noting previous PowerStream consolidations have positively affected local residents. “PowerStream is the product of consolidation. Eleven former electric utility companies (created) more of a regional utility in Simcoe and York. It generated a lot of benefits for consumers, in terms of efficiencies, that resulted in lower rates. We now have the scale and ability to innovate (through Alectra). The experience has been that the reliability, technology and response improved with the scale we’ve seen with PowerStream. All of these things will be enhanced by bringing these companies together, as it has in the past.”

For example, in emergency situations, crews from other municipalities can be dispatched to assist with repairs, he said.

Barrie Mayor Jeff Lehman says the move will ultimately benefit local customers. Basically, bigger is assumed to be better.

“This was a milestone day,” he said. “Your power bill will have a different name on it but the biggest change will be in the coming years as we have the scale and ability to bring people some savings on their power bill, badly needed at this point.”

PowerStream currently serves about 380,000 customers in communities including Alliston, Aurora, Barrie, Beeton, Bradford West Gwillimbury, Markham, Penetanguishene, Richmond Hill, Thornton, Tottenham, Vaughan, Collingwood, Stayner, Creemore and Thornbury.

According to PowerStream, the merger will allow for greater economies of scale and the spreading of administration costs over a larger base - resulting in savings for customers.

“Service improvements will first and foremost be focused on reliability,” Lehman said. “With the consequences to the economy of power outages being more serious every year, and with increasing severe weather, Alectra will have the scale to be able to respond faster to disruptions. We’re also looking to provide new services to people, everything from conservation (reducing their energy use and their bills) to more innovative things like emerging home energy technologies. Basically, being bigger allows us to do new things we couldn’t do before, do things faster and, overall, do them cheaper.”

The merger will allow for technology advancements such as the development of a micro-grid back-up system, he said.

Lehman also said the Patterson facility will “not really be affected” by the merger.

“It’s an operations facility - trucks and poles and wires - as well as customer service and a few other functions,” he said. “We will continue to have those all across our service area in the communities we serve, and the jobs will stay in the communities.”

Groundwork for the merger was laid in April 2015, when representatives from each organization announced an intention to form a new utility with the goal of serving nearly one million people in Simcoe, Hamilton, St. Catharines, and York and Peel regions. The move was approved by the Ontario Energy Board last month.

Under the plan, PowerStream, Enersource and Horizon will officially merge Feb. 1 and then purchase the Brampton utility Feb. 28. Alectra will become the second-largest municipally-owned electric utility company in North America.

Other municipalities should explore these types of mergers in the future, Energy Minister Glenn Thibeault said.

“The launch of Alectra is a win-win for both electricity ratepayers and for municipalities in communities across the region,” he said. “It will result in an improved company that is better positioned to serve customers who will also benefit from savings on electricity rates. I am pleased that each of the municipalities involved recognized these benefits and I hope more municipal leaders across Ontario will follow their lead.”