Hydro One sale continues to have negative credit consequences
July 24, 2017QUEEN’S PARK – The Premier’s Hydro One debacle is producing even more bad outcomes for Ontario, Nipissing MPP Vic Fedeli said today.
Shortly after their announced $6.7 billion purchase of Avista, Hydro One Inc.’s credit outlook almost immediately was changed from stable to negative by Moody’s service.
Hydro One Inc.’s credit rating was downgraded twice in two months in fall 2015 by Moody’s from A1 to its current A3.
Moody’s stated “that the probability of extraordinary support from the Province of Ontario will be reduced” as a result of the Avista deal, which “will rely on debt financing, a credit negative.”
S&P also changed its outlook from stable to negative for both Hydro One Inc. and Hydro One Ltd. following the announcement, Fedeli noted. “This negative credit rating could lead to higher borrowing costs that are ultimately passed on to Ontario ratepayers.”
Not only does the Avista deal hypocritically get Ontario back into the coal business, but it does nothing to help struggling ratepayers, he added.
“Why should Ontario families be left with even higher bills when Hydro One is throwing billions at foreign companies? This is not fair to Ontario ratepayers and Hydro One’s application for a massive new rate increase should be immediately rejected,” concluded Fedeli.