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The entire board of Hydro One Ltd. is resigning and chief executive officer Mayo Schmidt has announced his immediate retirement, succumbing to pressure from Ontario Premier Doug Ford for new leadership at the electrical utility.

Mr. Schmidt became a repeated target for Mr. Ford during the Ontario election campaign as the Progressive Conservative Leader courted an electorate unhappy with expensive electricity. At numerous campaign events, Mr. Ford promised to fire Mr. Schmidt, whom he dubbed the “$6-million man,” as well as the company’s board, immediately after entering the premier’s office.

“I’m happy to say today, the CEO and the board of Hydro One, they’re gone, they’re done. We’re going to turn a new corner,” Mr. Ford said on Wednesday afternoon at a press conference outside his legislature office. “I’m proud to announce . . . that the severance for the CEO was zero, absolutely zero.”

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Opinion: Doug Ford kneecaps Hydro One

Doug Ford Year One: A guide to what’s happening in the new Ontario

Despite Mr. Ford’s assurance that the board is already gone, the new board is not going to be fully in place until Aug. 15. Mr. Schmidt will not receive severance pay, however he will collect $400,000 in a lump-sum payment in lieu of postretirement benefits and allowances, and holds share units that were worth more than $7-million as of Dec. 31. Hydro One did not reply to questions about the value of any pension Mr. Schmidt might collect.

In a news release on Wednesday, the company said it had agreed to “the orderly replacement of the board of directors” after discussions with the new government. The Ontario government owns 47 per cent of the utility, which controls much of Ontario’s electrical-transmission system and was partly privatized by former premier Kathleen Wynne. The government retains the ability to force out the board if it wants to.

The new Premier, who was sworn in nearly two weeks ago, said that discontent with electricity rates was the leading issue he encountered while campaigning. He promised bills would be coming down.

Under the agreement struck between the Ontario government and Hydro One, Mr. Schmidt’s retirement was immediate on Wednesday. The utility also promised to consult with the province on all “future matters of executive compensation.”

The Ford government will also be introducing a bill in the legislature’s next sitting to increase “transparency and accountability” at Hydro One, according to a statement from the province’s energy ministry.

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Hydro One’s level of compensation for its executives flared up earlier this year when The Globe and Mail first reported that the company’s board had approved changes to the chief executive’s compensation package. Those changes increased the amount of severance Mr. Schmidt would be owed if he was fired after the board was replaced or if the government passed a law limiting his compensation.

Under the new rules, Mr. Schmidt would be eligible to receive about $10.7-million if he were terminated by a change brought to the company through government interference.

Both Mr. Ford and Ms. Wynne said the changes to compensation were “unacceptable.” Despite those objections, shareholders who voted on the company’s compensation plan in May voted 92 per cent in favour of it. The provincial government abstained.

After the company’s shareholders voted in favour of increasing Mr. Schmidt’s compensation, Hydro One chair David Denison said that he believed the CEO’s pay was “appropriate” for the utility, which is currently in the midst of completing a deal to expand into the United States and has further ambitions to expand in Canada.

The company has also objected to Mr. Ford’s allegations in the past that Hydro One was linked to the increase in electricity prices. Those rates are set by a public body, the Ontario Energy Board.

One Wednesday, Mr. Denison said that the agreement to replace the board and Mr. Schmidt was in the best interest of Hydro One and would provide the “stability and clarity” for the company’s governance and management structure in the future.

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The utility’s board will now be replaced by 10 new directors, four of which will be named by the government. The new board will find Mr. Schmidt’s replacement.

Mr. Ford wouldn’t explain when asked by reporters why Mr. Schmidt had forgone his severance. “My friends, I said we were going to do this and we did it,” he said, directing questions to Hydro One.

NDP energy critic Peter Tabuns called on Mr. Ford to release the details of the deal with Mr. Schmidt and the company’s board, including the full cost. “Doug Ford needs to tell people what kind of backroom deal he worked out with Mayo Schmidt to get him to walk away,” Mr. Tabuns said in a statement.

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