Hydro One strengthens northern Ontario transmission network with C$257M acquisition

In a strategic move to enhance electricity delivery and regional economic growth, Hydro One Limited, through its subsidiary Hydro One Networks Inc., has announced the acquisition of a 48% stake in the East-West Tie Limited Partnership. The $257 million deal positions Hydro One as a key force in Ontario’s northern energy sector while reinforcing its commitment to sustainable infrastructure and Indigenous collaboration.

What Does Hydro One’s Acquisition Mean for Ontario’s Energy Grid?

The East-West Tie Line, a 450-kilometre, 230 kV transmission line, plays a critical role in connecting Wawa to Thunder Bay along the northern shore of Lake Superior. Regulated by the Ontario Energy Board (OEB), the line supports the growing energy demands of communities and industries in northwest Ontario, ensuring a stable and reliable electricity supply.

Hydro One’s acquisition expands its operational scope, which already encompasses over 90% of Ontario’s transmission network. The remaining ownership of the East-West Tie Line includes the Bamkushwada Limited Partnership—a consortium of six First Nations holding 3.5%—and affiliates of NextEra Energy Canada, LP with a 48% stake.

How Does This Deal Reflect Hydro One’s Long-Term Strategy?

David Lebeter, Hydro One’s President and CEO, highlighted the company’s enduring role in northern Ontario’s energy landscape. He described the acquisition as pivotal for ensuring the reliable delivery of electricity while promoting economic opportunities in the region. This move underscores Hydro One’s long-term strategy to modernize infrastructure, integrate Indigenous participation, and meet evolving energy needs.

The East-West Tie Line was developed in partnership with six First Nations: Fort William First Nation, Michipicoten First Nation, Biigtigong Nishnaabeg, Pays Plat First Nation, Netmizaaggamig Nishnaabeg, and Red Rock Indian Band. These Indigenous communities played a significant role in the project’s development, marking a milestone in collaborative infrastructure initiatives.

A Collaborative Vision for the Future

OMERS Infrastructure and Enbridge, the sellers of the 48% stake, emphasized the strength of their partnerships with Indigenous stakeholders and Hydro One. Michael Hill of OMERS Infrastructure described Hydro One as a natural partner with the expertise needed to ensure the line’s efficient operation. Matthew Akman of Enbridge noted the project’s focus on fostering Indigenous inclusion and sustainable development.

Why This Matters for Northern Ontario

With an OEB-approved rate base of $880 million, the East-West Tie Line represents a major asset for Ontario’s energy grid. It connects remote regions to reliable electricity, supporting economic development and community resilience. Hydro One’s expanded role in managing this critical infrastructure aligns with its mission to invest in assets that deliver long-term value to its stakeholders.

The acquisition, pending customary regulatory approvals, was facilitated with advisory and legal support from CIBC Capital Markets, Gowling WLG, TD Securities, and Torys LLP.

This investment not only strengthens Hydro One’s transmission portfolio but also underscores its commitment to fostering economic growth, environmental sustainability, and Indigenous partnerships.