Ontario’s Electricity Regulation Crisis Report – Part Seven: Liquidated Damages from Cancelled Contracts Coming

In light of the Ontario Energy Board chair’s letter to Toronto Hydro, discussed in Part Six of this series, it is absolutely clear that any and all costs associated with the recent careless and irresponsible actions taken by Toronto Hydro to cancel contracts ought to accrue to the shareholder and not be the responsibility of ratepayers.

The contractor services contracts that Toronto Hydro has been cancelling this week routinely include liquidated damages clauses that would compensate the contractor in the even of cancellation. Depending on the stage and scale of the contracted work, such liquidated damages clauses are likely to result in substantial financial penalties.

4 Comments

  1. Thanks for keeping the general public informed on these matters. It’s nice to hear the facts from a reliable source instead of these deceptive and politically driven newspapers.

    • Don’t slag the MSM too much. Reporting on regulation is inherently difficult. The Toronto Star coverage has been excellent. Jerry Agar has done some good work on this at CFRB. The story has been developing so fast that we should give the other papers at least another day. I expect the National Post will have some coverage tomorrow.

  2. Nailing the damned shareholders instead of the innocent ratepayers for corporate misdeeds is something I usually support — or even champion. Yet in this case, when I find myself a more significant (unwilling) shareholder of Toronto Hydro than I am a ratepayer, it gives me strangely little comfort. Funny thing. . .

  3. Pingback: Ontario’s Electricity Regulation Crisis Report – Part 30: Ratepayer/Taxpayer Impacts of Management’s Hissy Fit at Tony’s Hydro (Formerly Toronto Hydro) | Tom Adams Energy - ideas for a smarter grid

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