Hydro One Case

1. What is Hydro One´s Strategy?

Hydro One´s philosophy is to be the best distribution and transmission business for electricity in North America. Under CEO Tom Parkison Hydro One created new strategies: The implementing of enterprise risk management (ERM), a risk-based investment planning system, and a balanced score card that featured a strong emphasis on costumer service. So Hydro One want to achieve: best safety record in the world, top quartile transmission and distribution reliability, 90% customer satisfaction across all segments, top quartile employee productivity, operating efficiency, and an “A” credit rating.

Their strategy also is to find all issues that the company faces and evaluate the biggest risks twice a year. After that they will rank those risks and find ways to lower those (all kind of) risks. The next step is to find a solution for evaluating the amount of the risk reduction per dollar. The one most important and succesful solution will be attached for the year. In the end a finance summary is handed and a prasentation is hold to the Risk Department.

2. Why are they spending on the Bruce-Milton/Toronto line and the Smart Meters?

They are spending this money into the projects to mainly covering costumers energy-needs which means that they will have more lines to Toronto. Of course they want to increase the satisfaction of their consumers needs with these extra capacity. This is one of their new strategies. They also spending those money to acting more environmentally friendly to get environmental approvals. That includes conserving energy and recourses.

3. Putting yourself in the shoes of CEO Laura Formusa, what risks does Hydro One face?

Risks they faced are:

- goverment risks and regulatory uncertainty because of re-election of the ruling party

and conflicting interests with those party.

- pricing risks because uncertainty of the oil business.

- risks of increasing costs because of the uncertainty of the whole american economy....