The sale of Collus/PowerStream to Epcor has been approved.
The Ontario Energy Board has approved the sale of Collus Powerstream to Edmonton based Epcor, providing Epcor with its first entry into Ontario as an electricity distributor.
Collingwood, ON [30 August 2018] – The Ontario Energy Board announced today that it has approved the sale of Collus PowerStream to EPCOR Utilities.
In October 2017, Collingwood Council voted to sell its 50% stake in Collus PowerStream, the local distribution company, owned by the Town of Collingwood and Alectra (formerly PowerStream).
The Town of Collingwood is pleased that a decision has been made, and looks forward to welcoming EPCOR to our community. It is anticipated that the transition will be a smooth one, as EPCOR has spent a great deal of time since October in Collingwood, getting to know our community and the Collus PowerStream staff.
Terms of the sale include:
a distribution rate decrease for residential customers for 5 years
a 25-year lease of the Collus PowerStream property and operations centre from the Town
job and location guarantees for Collus PowerStream employees
a contribution of $150,000 towards the Waterfront Master Plan, one of the community’s biggest priorities, as identified in the Community Based Strategic Plan
The Town will receive between $12.5M and $13M from the sale of their 50% shares. In 2012, the Town received $8M for 50% of its Collus PowerStream shares. The municipality is confident that the purchase price and terms established by the Town maximizes the value of the shares, and is in the best interests of Collingwood, its taxpayers and ratepayers.
From the OEB decision:
This is the Decision of the Ontario Energy Board (OEB) regarding an application filed by the Corporation of the Town of Collingwood (the Town) and EPCOR Collingwood Distribution Corporation1 (EPCOR) (collectively, the Applicants). The Applicants’ application requested that the OEB approve two share purchase transactions that would result in EPCOR becoming the new owner of Collus PowerStream Corporation (CollusLDC), the local electricity distribution company serving Collingwood, Stayner, Creemore and Thornbury. If approved, this transaction would provide EPCOR with ownership of its first electricity distributor in Ontario.
The two sequential share purchase transactions proposed by the Applicants that require OEB approval are as follows.
First, the Town proposes to purchase the shares of Collingwood PowerStream Utility Service Corporation (CollusHoldco), the holding company of CollusLDC, that are currently owned by Alectra Utilities Corporation (Alectra Utilities).
Second, the Applicants propose that EPCOR will then purchase all of the shares of CollusHoldco from the Town. These transaction approval requests were made pursuant to Section 86 of the Ontario Energy Act, 19982 (the Act) which requires a transmitter or distributor to obtain leave of the OEB before disposing of its distribution or transmission system or amalgamating with another corporation.
Additionally, the Applicants seek OEB approval for a one percent reduction in CollusLDC’s current electricity distribution rates for residential customers and that this reduction be in effect for the first five years following the transaction.
The application proposes to defer rate rebasing for five years following completion of the transaction. Lastly, the application requests approval to continue to track costs to the regulatory asset accounts currently approved by the OEB for CollusLDC and to seek disposition of their balances at a future date. The OEB has applied the “no harm” test in assessing this application and has concluded that the proposed transactions meet that test.
The OEB therefore approves the application as filed. The OEB also approves the additional requests made by the Applicants as further described in this Decision.