Simcoe, ON – In a Decision and Order issued July 3, 2014 the Ontario Energy Board (OEB) has approved the sale of the shares of Norfolk Power Inc. to Hydro One Inc. for $93 million. Norfolk Power Inc. is Norfolk County’s holding company for Norfolk Power Distribution Inc. (NPDI), its electricity distributor, and Norfolk Energy Inc. (NEI), its telecom company.
The OEB approval of the deal includes a 1% rate reduction for 5 years for NPDI customers and NPDI must transfer its distribution system to Hydro One Networks Inc. within 18 months of the completion of the sale, which is expected to be completed in August or early September of this year.
In the Decision and Order, the Board stated, “As discussed above, the acquisition would result in a single electric distribution service provider for all of Norfolk County, eliminating the current electrical service boundaries. It is reasonable to conclude that ultimately this will result in greater economic efficiency and cost effectiveness, through greater economies of scale and enhanced efficiencies.”
Norfolk County announced its sale of Norfolk Power to Hydro One in April of 2013. The selection of Hydro One was the result of a comprehensive four-month competitive sale process which involved expressions of interest or proposals from numerous potential Canadian buyers.
In October 2012, Council unanimously decided to commence a process for the possible sale of Norfolk Power. At the final stage of that process Mayor Dennis Travale stated, “Council is confident that selling the shares of Norfolk Power to Hydro One is in the best interests of everyone. Our sale to Hydro One shows that voluntary consolidation of electric utilities can provide significant “win-wins” for employees, ratepayers, municipalities and the Province”.