Apr. 26, 2002. 01:00 AM Now for the hydro hard sell
Ian Urquhart
AS PREMIER Ernie Eves put it in a news conference yesterday, the government is launching a "consultation process" in the coming weeks to hear what the public thinks should be done with Hydro One.
"It's important to hear from the people of Ontario," Eves said.
But it will evidently be a two-way process, with the government talking as well as listening. This became clear when Energy Minister Chris Stockwell, who will be the person actually conducting the consultation in a cross-province tour, followed Eves to the podium yesterday.
Stockwell declared his role will be to ensure the public has a greater "comfort level" with the idea of privatizing Hydro One, the publicly owned firm that operates the electricity transmission lines criss-crossing Ontario.
"It's up to us now to explain to them why we believe this is a good idea," said Stockwell. "I don't think the public understands it."
Thus, don't expect Stockwell to pay attention if the public tells him not to sell Hydro One. The government has already made up its mind to do that, notwithstanding a court ruling last week that said it lacks the authority to sell it.
The government will fix that legal problem in the spring sitting of the Legislature with a bill stipulating that it has the authority to sell Hydro One. Both Eves and Stockwell made that clear yesterday.
But Eves and Stockwell know the privatization of Hydro One is a hard idea for the public to swallow. Hence, the "consultation" tour by Stockwell. It will likely be accompanied by a TV and radio ad campaign, although Stockwell would not confirm that yesterday.
And the Tories are also being careful with their language on Hydro One.
Yesterday, for example, Eves avoided relatively harsh words like "privatization" and "sale" in reference to Hydro One and used fuzzier terms like "restructuring," "initiative" and "disposition." At least he did until the very last question, when he slipped and blurted out: "I believe it's important that Hydro One be privatized." That's the clip the Opposition parties will want as they fight the government's publicity campaign.
Eves also made it sound like the privatization of Hydro One was an essential part of the package of measures the government is undertaking to reform the electricity market.
These include: breaking up the old Ontario Hydro (into a transmission company, Hydro One, and a generating company, Ontario Power Generation, or OPG); introducing competition on the generating side either by selling off some OPG power plants to the private sector or allowing private companies to build new plants; and deregulating the electricity market beginning May 1.
"Through competition we'll see the best results," said Eves.
Added Stockwell: "(A privatized Hydro One) will make for better management, better decision-making and a better operation."
In fact, however, when the Tories took the initial steps toward restructuring the electricity market in their first term, the sale of Hydro One was not part of plan.
Indeed, according to Tory MPP Garry Guzzo, who was parliamentary assistant to the minister of energy at the time, the idea of privatizing Hydro One was raised internally and specifically rejected.
With good reason. Hydro One is a natural monopoly. There will be no competing transmission lines.
And as a counter to Stockwell's suggestion that in private hands Hydro One will make better decisions, consider the example of Bell Canada, a regulated monopoly that is being rocked by poor choices by its management.
But in their second term, the Tories put Hydro One up for sale. They were probably influenced by their friends on Bay Street, who stand to make mega-bucks in fees from selling shares in Hydro One to individuals and institutions.
The decision to sell was actually made by the former premier, Mike Harris. He's gone now, and Eves is stuck with the hard part: convincing the public it is a good idea.
At the end of yesterday's press conference, after most of the reporters had left, Liberal energy critic Sean Conway, the longest-serving member of the Legislature and the one with the best grasp of history, took the podium. He compared what Eves and the Tories are doing to the federal Liberals' decision to ram through the pipeline bill in 1956.
"(Then prime minister) Louis St. Laurent paid a bit of a price, as I recall," mused Conway.
Indeed, St. Laurent did. He lost the ensuing election to John Diefenbaker.
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