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Ontario Local Electricity Distribution Companies

The Ontario electricity industry underwent significant restructuring aimed at establishing a competitive electricity market on the premise that competition will foster price and cost discipline among electricity providers.

The Energy Competition Act, enacted in 1998, established a framework for a competitive electricity market in Ontario.  It introduced the following reforms:

  • competitive wholesale and retail electricity markets
  • vertical separation of Ontario Hydro into five successor companies including Hydro One Inc. and Ontario Power Generation Inc.
  • corporatization of the distribution sector and clarification that municipalities were the sole shareholders of their local distribution companies (LDCs).  As sole shareholders, municipalities had the right to determine whether they should:
    • continue to operate their LDCs as non-for-profit companies or establish for-profit corporations
    • retain ownership, partner, sell or lease their LDCs to third parties
  • the Ontario Energy Board was tasked with the regulation of the electricity sector.

During a time of significant restructuring of the electricity industry in Ontario, Macquarie was able to draw on its significant expertise with similar transactions in the utilities sectors in Australia and around the world to assist many LDCs and their owners in reviewing the available ownership and/or financing options.  Macquarie North America has worked on a number of LDC assignments in Ontario including:

  • Barrie Hydro Distribution Inc.’s acquisition of the four neighbouring utilities of Bradford-West Gwillimbury, Essa, New Tecumseth and Penetanguishene
  • Veridian Corporation’s acquisition of the Uxbridge and Port Hope Hydro-Electric Commissions
  • the acquisition of Richmond Hill Hydro Inc. by Markham Hydro Distribution Inc. and Hydro Vaughan Distribution Inc.

In addition, Macquarie North America has completed a variety of assignments for other LDC clients including ENWIN Utilities Ltd., the Ottawa Transition Board, Brantford Power Inc. and Greater Sudbury Utilities.

Macquarie North America has assisted the Municipal Electricity Association (predecessor to the Electricity Distributors Association) to develop a framework for the amalgamation of LDCs and has provided expert testimony at Ontario Energy Board hearings on regulatory matters.

Macquarie North America has also worked with a number of LDC clients on building new businesses in the retail/energy services and telecommunication sectors through the development of business plans and financing strategies.



  Important Information
Macquarie North America Ltd
 

Any Macquarie subsidiary noted on this page is not an authorised deposit-taking institution for the purposes of the Banking Act (Cwth) 1959. That subsidiary's obligations do not represent deposits or other liabilities of Macquarie Bank Limited ABN 46 008 583 542 (MBL). MBL does not guarantee or otherwise provide assurance in respect of the obligations of that subsidiary, unless noted otherwise.