A Trump-style populist elected this month in the Canadian province Ontario vows to purge the leadership of Hydro One, the Canadian company acquiring the parent corporation of Alaska Electric Light & Power.
Doug Ford’s right-of-center Progressive Conservative Party swept to power in Ontario earlier this month. During his campaign, he pledged to fire the top executives of Hydro One on his first day in office — June 29.
“We will stop the hydro ripoff, we will clean up the hydro mess and when we are in government, we’re going to put an end to the hydro executives getting rich off the taxpayers of this great province,” Ford declared in April.
The incoming leader of the province has leverage: the Ontario government owns 47 percent of the company.
“Any kind of business issue where you’re controlled by government or whatever you always get drawn into politics,” said Toronto Star veteran political reporter Rob Ferguson.
Hydro One has been an easy target, he said.
Across eastern Canada, utility bills have been doubling or in some cases tripling. All the while Hydro One’s new CEO raking in an unprecedented salary: $6 million (Canadian).
“Along comes Progressive Conservative leader Doug Ford who starts calling him ‘The Six Million Dollar Man’ and kind of makes him the scapegoat for everything,” Ferguson said. “And you know the fact is if the guy makes $6 million or if he makes what you and I make taking that off the system isn’t going to make hardly any difference. Not even a penny on hydro bills. But it is symbolic so that’s how he rallied this issue.”
Ford’s red-blooded rhetoric calling for heads leads to inevitable comparisons to Donald Trump.
Efforts by reporters to glean more details about Ford’s plans for Hydro One — especially pertaining to its purchase of AEL&P’s parent company Avista — have been fruitless.
“The clearest answer we’ve got on that is pretty vague,” Ferguson said. “Premier Ford would leave that decision about what to do with the Avista deal up to the board. Meanwhile, we’re saying that you could be premier – and now he is going to be premier – maybe you owe the voters of Ontario a little more detail on that.”
The Avista sale still needs approval by regulators in U.S. states where it does business. Authorities in Alaska and Montana have given the green light, but the purchase remains under review in Oregon, Washington and Idaho.
Electricity prices in Alaska are regulated, which would buffer Juneau’s power rates from the winds of political change in Canada.
“I would say we’re fairly insulated the way we’ve developed the settlement,” said Kirk Gibson, the Portland, Oregon-based attorney retained by the City and Borough of Juneau to negotiate with Hydro One.
Gibson helped secure commitments from the company and in return, the city agreed to support the deal, which spared Hydro One from having to hold hearings before Alaska regulators.
Gibson said one commitment Hydro One made was prior regulatory approval for any corporate reorganization that could put AEL&P under direct control of the Canadian parent company.
“That was the stitch that we put in to make sure that everything was tied up,” Gibson said.
The future of Hydro One remains an open question.
Ferguson said as long as the government has a stake – any stake – in the company it’ll be red meat for politicians.
“You can think that you’re running a private company that’s traded on the stock exchange,” Ferguson said. “Even though you’re not technically fully under the thumb of the government, in the court of public opinion, you are. And that’s what’s happened here.”