Clitheroe urges hydro reform

TORONTO -- Eleanor Clitheroe, former chief of Hydro One Inc., made a rare public appearance yesterday and called for a return to deregulation in Ontario's electricity market.

Ms. Clitheroe said Ontario should reintroduce competitive pricing for power in order to ensure adequate supply.

"I would hope that we've paused and taken a deep breath and that ultimately we will move on in our electricity reform," she said yesterday after making a speech at the Power Care industry conference. "We are a province that really can benefit from competitive electricity prices."

Ms. Clitheroe was fired as chief executive officer of Hydro One a year ago amid allegations she misused company funds. She denied the allegations and is suing the utility.

Her dismissal also came as the province's energy policy was thrown into turmoil shortly after Ernie Eves took over as Premier last spring from Mike Harris. Mr. Eves scrapped a planned privatization of Hydro One and re-regulated retail electricity prices.

The retail price has been capped at 4.3 cents a kilowatt-hour, the regulated price before the market was opened in May, 2003. The wholesale price is currently above 9 cents a kilowatt-hour and the provincial government pays most of the difference.

Ms. Clitheroe said yesterday that prices should reflect supply and demand because that is the best way of encouraging companies to produce more power. The experience in other countries has shown that "private enterprise under regulation has been able to manage the product while protecting consumers interests," she told the conference.

She said Ontario's backtracking on the open market demonstrates how difficult it is for governments to move from a regulated market to an open system. "In Ontario the electricity policy of 100 years ago is still prevalent in expectations of consumers today."