Hydro One Ltd., H-T one of Canada’s largest power utilities, has promoted its chief operating officer to chief executive after its former CEO abruptly left last summer to run an Alberta rival.
David Lebeter will take the helm at Hydro One effective Feb. 1. He joined the Ontario-based electricity distributor in 2020 from BC Hydro, where he had worked with Mark Poweska, who resigned as Hydro One’s CEO last June.
Mr. Lebeter is Hydro One’s third CEO in five years, and the company has endured intense turnover at the board level during its short history as a public company. Despite the tumult, investors have remained enamoured with the utility – its shares are up 76 per cent since the company’s 2015 initial public offering.
The utility used to be wholly owned by the Ontario government but was privatized in 2015 by the governing Liberals, though the government is still Hydro One’s largest shareholder. At the time, the decision was politically controversial because electricity prices in the province were rising and some voters mistakenly believed the two events were connected.
The chief executive hired to run the utility as a public company, Mayo Schmidt, only lasted three years. He became a target of then-Progressive Conservative Leader Doug Ford during the 2018 provincial election campaign, who referred to Mr. Schmidt as the “six-million-dollar man” because of his $6.2-million compensation package.
Mr. Ford suggested that, as premier, he would not stand for such a waste of taxpayers’ money. Two months after he was elected, Mr. Schmidt stepped down, and the board of directors resigned en masse.
In response, Hydro One’s reconfigured board recruited Mr. Poweska from BC Hydro, but he also lasted only three years. At the time of his resignation, Hydro One said Mr. Poweska was taking a job at a utility closer to his family in Western Canada. Calgary-based Enmax Corp. later announced that he was its new chief executive.
Hydro One conducted a seven-month search before settling on Mr. Lebeter, 62, as its newest leader. As COO he has overseen electricity transmission and distribution, including construction, maintenance and vegetation management, as well as system operations, asset planning and engineering.
The Ontario government’s interference initially weighed on Hydro One’s shares, and the utility’s stock fell to roughly $19 by late 2018, down from $20.50 at its IPO. However, interest rates were also rising in 2018, and higher rates tend to hurt high-yielding stocks such as utilities.
Although interest rates are rising again, Hydro One’s shares have outperformed the broader market of late. In 2022 they delivered a total return, including dividends, of 14 per cent, while the S&P/TSX Composite Index’s equivalent return was a loss of 6 per cent over the same period.
Hydro One’s shares slipped 1.3 per cent by late afternoon Tuesday.