Long-Term Deals, Smart Meters, and Infrastructure Development in Formosa

Another objective to help this Lana for Formosa is to work out a long-term deal with the unions, preferably around five years. 2) Why are they spending on the Bruce-Milton/ Toronto line and the Smart Meters? As Formosa talked about, the environment is getting to be a bigger issue for the industry. The Smart Meter going hand-in-hand with smart pricing can hopefully reduce use and save customers money, and help customer satisfaction. They also want to bring electricity down from the Bruce nuclear plant on Lake Huron to Milton and the Greater Toronto area because the two nines they have are insufficient.

There is a lot of wind generation in the Bruce area. 3) Putting yourself in the shoes of CEO Laura Formosa, what risks does Hydro One face? There are a number of risks that Hydro One faces. One risk includes the uncertainty involving the government, in particular the upcoming election in Ontario. If the ruling party is re-elected, Hydro One would be expected to lead the initiatives despite their adverse impact on the company revenues and earnings.

Formosa has doubts whether they can deliver on the government’s inspiration goals without compromising its commercial viability.

Other risks include the safety issues for the employees, adequate electronic supply, equipment failure, and also issues in the environment. 4) Consider the elements of Hardy One’s ERM process. What are its strengths and weaknesses? What recommendations would you make to overcome the weaknesses about the ERM process? A strength of the ERM process are that it fully involves every aspect of the business.

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I also like the chart they use to rank each risk involved. Also, there is omelet separation between risk management and the internal audit.

This process also gives high visibility and scrutiny, and the idea of reviewing the risk profile regularly is also a smart idea. Some weaknesses of the ERM process includes the fact that only management IS involved in the process. Risk experts aren’t really involved until the risks have been established by others. Also, only the highest risks have highest priority in terms of finding mitigation option. I would recommend getting the risk experts involved much earlier in the process.