Ratepayers can expect their bills to jump by something under $3 a month to pay for the two-year spending program approved by the Ontario Energy Board.
The new spending program is still much leaner than the ambitious, three-year project that Toronto Hydro had requested more than a year ago, and which led to a bitter fight with the energy board.
On Tuesday, the board approved most of a $750 million spending plan to renew the utility’s aging equipment, half of which has exceeded its expected life.
And it rejected most arguments from business, environmental and consumer groups asking for a slowdown or cancellation in some of the major projects.
Toronto Hydro executives were still poring over the complex, 91-page decision late Tuesday, but were cautiously happy.
“The majority of our projects were approved, with some exceptions,” said spokeswoman Tanya Bruckmueller. “So over-all, we’re pleased.”
She said it will take more time for officials to fully analyze the details of the complicated decision.
Had all the utility’s requests been fully granted, households would have paid $3 a month more effective May 1. But since some spending proposals were scaled back, the increase will be less.
While Tuesday’s decision was welcomed, it hasn’t all been clear sailing for Toronto Hydro, whose sole shareholder is the City of Toronto.
The energy board had rapped the company’s knuckles a year ago when it sought an extra $1.5 billion in funding over three years to renew aging equipment and train new workers. It would have cost a typical household an extra $5 a month.
Toronto Hydro officials warned at the time that if they didn’t get the funding, the city would suffer longer and more frequent blackouts.
Half the utility’s equipment is past its expected life span, they said.
But the energy board refused to accept the dire warnings, and sent Toronto Hydro back to reduce its spending plans and look for savings in its system.
Initially, that move triggered dozens of layoffs at the company.
It then re-submitted a spending plan covering two years instead of three, and asking for a total of $750 million for equipment renewal and training.
The biggest win for Toronto Hydro in Tuesday’s decision appears to be its application to build a $184 million transformer station (originally priced at $195 million) on Bremner Blvd.
The new station is needed, Toronto Hydro said, to back up an aging transformer station in the financial core, which currently has no safety net.
A major failure at that station could knock out power to the city’s biggest office towers, the Rogers Centre, Union Station and the CBC, Toronto Hydro warned.
The time needed to restore power in the event of a major breakdown, it said, might be measured “in days, possibly weeks.”
Some groups questioned the need for the Bremner station, arguing that aggressive conservation programs, plus the construction of some small scale power stations in the heart of the city, could reduce the need for a new station that allows more power to flow into the city core.
The energy board disagreed with the critics.
It rejected the argument that conservation and local generation could forestall the need for the project.
“The Board finds that Toronto Hydro has justified the need for the Bremner project,” it wrote, and said there was no point in a go-slow approach.
“The Board finds that projects of this type cannot be deferred indefinitely, and sees no benefit in reviewing the project again in a year or two,” it wrote. “Rather, the Board finds it prudent to proceed with construction now.”
Other projects approved include:
$108 million to replace aging poles and overhead equipment. Some intervenors at the hearing had criticized Toronto Hydro’s approach of replacing all poles in an area, and said it should only replace poles that are failing. The board rejected the argument.
Toronto Hydro’s approach “minimizes cost and disruption, compared to doing it on a pole by pole basis as they fail,” it ruled.
$54 million to replace handwells in sidewalks that give access to underground power lines. Stray electricity leaking from handwells was electrocuting dogs several years ago. Toronto Hydro has been replacing handwells since then, and asked for funding to replace all remaining handwells.
Some intervenors at the energy board had asked for a more limited replacement, but the board accepted Toronto Hydro’s argument that it “would increase the risks to public safety, and could be more expensive.”
$172.3 million for replacing underground cables, transformers and vaults. Again, the board said a go-slow approach that might reduce immediate spending isn’t merited:
“Having found that the work is required and prudent, any reduction to the program is arbitrary and not supported by any evidence.”
Original Article
Source: thestar.com
Author: John Spears
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