OTTAWA, June 13, 2012 /CNW/ - In a presentation to Ottawa City Council on Hydro Ottawa Holding Inc. results, Chairman of the Board Pierre Richard, Q.C. announced today at its Annual General Meeting the signing of a purchase and sale agreement for three hydroelectric plants and a 38.3 percent interest in the Ring Dam at Chaudière Falls from Domtar Corporation for up to $45 million. The closing is expected August 31, 2012.
The acquisition is part of Hydro Ottawa's strategic plan to pursue growth opportunities that are good for the environment, that provide reliable electricity to its customers and stable long-term returns to its shareholder, the City of Ottawa. Prior to signing the PSA, extensive due diligence was conducted by Hydro Ottawa and BMO Capital Markets was retained as its exclusive financial advisor for the transaction.
"We already own and operate three other hydroelectric plants at the Chaudière site," said Richard. "This acquisition increases our generating capacity at Chaudière from 17 megawatts to 38 megawatts of clean electricity, enough to power 28,000 homes every year."
The site in the heart of the nation's capital is of major historical significance, and it is one of the largest remaining hydro sites available in Ontario with an expansion opportunity that could see Hydro Ottawa's capacity at the Chaudière site grow to 60 megawatts.
Bryce Conrad, Hydro Ottawa President and CEO, provided an overview of the company's new strategy for 2012-2016, focused on growth and maximizing customer value - putting the customer first. He discussed a number of projects that are consistent with the new strategy.
"In addition to the acquisition of these hydroelectric facilities, Hydro Ottawa continues work on a 4.5 megawatt landfill gas-to-energy facility at the Laflèche Landfill site in Moose Creek, Ontario, expected to be in service in 2013," said Conrad. "The plant will generate 24,000 megawatt-hours of renewable energy per year - enough to supply 2,500 homes."
Mayor Watson, a Director of the Hydro Ottawa Holding Inc. board added that he is "pleased with Hydro Ottawa's strategic acquisitions which will more than double our clean, green energy production and contribute to the City's sustainable and economic bottom lines."
Hydro Ottawa also announced the launch of a new mobile customer service application. Using a smart phone or tablet computer, customers can now access MyHydroLink to manage their accounts; get updates on electricity outages; access information on rates; contact Hydro Ottawa with questions; or tap into its website.
Other key results and achievements presented to Council include:
- Hydro Ottawa Holding Inc. has provided a dividend of $16.6 million - $1.6 million higher than target - to its sole shareholder, the City of Ottawa, based on the company's strong performance in 2011.
- Over the past four years, normalized net income has exceeded projections by 24 percent, and dividends have been greater than plan by 40 percent.
- Hydro Ottawa customer satisfaction results outperformed the provincial average once again in 2011, and the company received the Customer Service Award from the Electricity Distributors Association for the use of technology to improve customer service.
- Distribution rates charged by Hydro Ottawa for the typical residential customer have been reduced by 7.3 percent since April 2011 due to one-time credits approved by the Ontario Energy Board as well as the company's emphasis on cost control.
- Hydro Ottawa made its highest capital investment ever in 2011, strengthening its infrastructure and enhancing future reliability.
- Energy conservation programs continued to be popular with customers in 2011, with the usage of electricity by the average residential customer declining once again. Since 2006, Hydro Ottawa customers have saved enough electricity to power about 52,000 homes for a year.
"We are very pleased to have surpassed our major financial targets over recent years, and to be a sound and rewarding investment for the City of Ottawa," said Richard. "Since paying our first dividend in 2005, Hydro Ottawa has delivered $121.3 million in dividends for City of Ottawa priorities. Looking to the future, we are positioned for growth and continued success."
About Hydro Ottawa
Hydro Ottawa Holding Inc. (Hydro Ottawa) owns and operates two subsidiary companies, Hydro Ottawa Limited and Energy Ottawa Inc. Hydro Ottawa Limited is the third largest municipally owned electrical utility in Ontario serving more than 305,000 customers in the City of Ottawa and the Village of Casselman. Energy Ottawa Inc., Ottawa's largest producer of green power, generates renewable energy and provides commercial energy management services.
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