City of Guelph councillors have voted in favour of merging Guelph Hydro with public utility company Alectra.
The decision was made Wednesday evening during a special council meeting at City Hall, by a vote of 10 to 3.
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"It's a very good news story for the residents and the businesses in town," Mayor Cam Guthrie told CBC News Thursday morning.
Over the past 14 months, Guelph Hydro has been exploring its future options. It recently presented city council with the two best case scenarios: maintain the status quo or merge with Alectra.
Reasons for merger
Guthrie said councillors realized that a merger would provide the city with some much needed capital.
Not only would the city get a one-time bonus of $18 million but it would also get $10 million in dividends over a 20-year period.
"It's not just a projection or just a hope or just us crossing our fingers," Guthrie said. "Because of the rules and regulations through the [Ontario Energy Board] that allow this to happen, it is very much a solid number that we can be assured of."
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The mayor said the merger will also benefit residents and business owners, who are used to seeing the rate of hydro increase every five years.
Guthrie said that because of the merger, there will be no increase for a 10-year period.
Now that council has approved the merger, the city and Alectra will make a formal application to the Ontario Energy Board. Guthrie said the application process can take up to 12 months.
Other municipalities served by Alectra include Mississauga, Hamilton, St. Catharines, Brampton and parts of York Region and Simcoe County.