Walkerton-based electricity company Westario Power is looking to sell to ERTH Corporation.
Westario announced its intention to sell on Monday to meet growing energy demands.
Company CEO Walter Malcom says while the proposed deal has not been finalized, it comes after the Westario Power Board took a look into the company’s future.
“We had three options that we were looking at, one was staying status quo, the second one was looking at merging and amalgamating, and the third one was looking at selling Westario Power. After looking at what changes are coming down in the electricity industry and Ontario over the next number of years, a decision was made by the board of directors and confirmed by the shareholders of Westario Power that sale of Westario Power was in the best interest of the employees, the community, and the shareholders,” says Malcom.
The power company first came online in 2020 and has serviced over 24,000 customers in communities including Port Elgin, Kincardine, Hanover, Southampton, and Walkerton.
ERTH is a municipal holding company which is jointly owned by nine Ontario municipalities. It distributes electricity to over 25,000 customers across 15 communities in southwestern Ontario.
Before the sale moves forward, Malcolm says they are currently in the phase where the shareholders of Westario Power need to approve the sale.
“We are doing that over the next couple of weeks. Our last shareholder meeting is Dec. 17, so our hope is to have all the approvals done by the end of this year,” says Malcom. “Once that takes place, then an application goes in front of our regulator. Both ERTH and Westario Power are regulated by the Ontario Energy Board. The Ontario Energy Board does a rigorous no harms test to make sure that customers are not going to be impacted by this transaction.”
Once the Ontario Energy board makes a decision following the tests, which could take up to four to six months, ERTH would assume control of Westario Power.
Malcom confirms nothing will change for customers in terms of both service and electricity rates outside of the regular annual inflationary rate changes.
Additionally, Malcom says ERTH has committed that there will be no job losses as a result of the sale.
Malcom believes the sale of Westario to be a great opportunity.
Adding, “Based on where the industry is going, I think this is the next step. Westario Power itself is constrained by our service territory, we have no room to grow outside of our service territory, so this is the next logical step is to work with another entity that has a number of communities and become a large organization that has the skill, has the financial resources and backing to keep up with the infrastructure changes that are going to happen when electrification continues to grow in our province.”