Hydro Costs Gone Wild

Ontario’s Hydro One has stated that it is spending $82 million this year to replace 11,000 poles or almost $7500 per pole. They estimate that more than 340,000 poles will have to be replaced over the next 10 years. Based on the costs this year, consumers will be paying more than $2.5 billion for those poles, which is a figure covering only about 20% of the 1.7 million wood poles in their system.

Hydro One has stated that a wood pole lasts about 62 years. Considering the number of poles in the system, that represents changing on average over 27,000 each year. If the replacement rate continues to average only 11,000 over the next couple of years, that would suggest increased costs on the longer term. Over 50% of my recent Hydro One bill was not for electricity but for delivery and regulatory charges as well as a debt retirement charge. It is no wonder that hydro is expected to increase 42% over the next 5 years.