The Tortures of Tort
Some thoughts on considerations of the sale of PDI to HydroOne
Much has been made about the sale of PDI to HydroOne recently. Most astounding to me is that there is not an established opinion on the effect this sort of deal has had on other communities. Have they benefited or not ? Do they not discuss it because they are bound by the sale contracts ? Why isn't this commonly known already ?
Firstly, I consider that no matter who 'owns' the hydro, the rates are generally set by the OEB, an arms length organization that is meant to liaise between HydroOne (or the provider) and the consumer to cater to the interests of both. This means that no matter who owns the utility, the rates are generally not set by the owner.
Secondly, we should consider that HydroOne would have NO interest in the sale/purchase if it wouldn't fatten their bottom line. This corporation has ONE motivation at its core and it is not to deliver the highest quality-lowest cost service to users. They are not interested in doing this to help the people of the city, no matter how emphatically they might present this pretense.
Finally, some basic accounting comes into play; So far we have spent hours of time and thousands of dollars to 'evaluate' the sale (in spite of popular opinion). This will go on ,and go through appeals, and on and on, until or unless we agree to sell. At the end of the day, if we decide not to, under trade laws like the TPP, etc., we could be forced to pay for HydroOne's losses from not "doing our part" to help their profits.
So when we consider that saying no to the sale will result in countless consultations (paid to be done outside the city), countless arbitration and suit after suit to prop up the sale... and then when we consider that HydroOne might sue us for infringing their rights to buy up every asset in the province - it is easy to see how saying "no" will be the least cost-effective solution for the citizens moving forward. THIS WILL, NO DOUBT, HEAVILY INFLUENCE THE CONCLUSIONS OF THE CONSULTANTS WE'VE NOW HIRED. Maybe it's all about more than today's bottom line though.
The only way to really protect this precious public asset from profiteering is to be emphatic. Will the sale produce some $50 Million up-front and a million every year thereafter ? Probably. Will this be a fraction of the long-term value of these assets. Probably. How will they city cope if HydroOne faces a disaster in some far-off place and we, in Peterborough, are forced to pay for it in increased rates (something we are, more or less, safer from today through city ownership)? Twenty years from now when our children cannot afford the price of these essential services, will the big-wigs in the Big Smoke, running HydroOne hear our plight ? How will local actions impact hydro decisions in the future if the people in charge are hundreds of miles away and buffered by millions of (our) dollars and armys of lawyers ? What leg will we have to stand on when the corporation, not the people, own the assets ?
When the founders of the area and the utility built this Electric City up, for pennies on the hour, do you think it was with an eye to one day selling out to massive corporate interests with a strong profit motive and little regard for the community - or did they hope for something more for us all ? Too often privatization takes assets from the public and then makes the public pay a premium for something they already, and by a right ought to have, owned.
Just look at the internet today. Public dollars developed it in research labs. The public made it big by creating a network of BBS services running out of peoples basements. Now go and try and get an internet connection from someone outside the big three providers and tell me how that goes. Astonishingly each of these companies charges pretty much the same exorbitant rate for something that costs almost zero to produce. There are more examples, but the main point here is that without serious commitment to the cause, we're going to lose ownership of our hydro services. Once that happens you can expect them to stop using any lube at all.
image through from: the warmonger blog: