It would have been $1.8 billion cheaper for Premier Kathleen Wynne’s government to borrow money for transit and infrastructure projects than sell a 53-per-cent stake in Hydro One, an independent watchdog says.

The controversial deal, which raised $9.2 billion, boosted Ontario’s bottom line by $3.8 billion in the fiscal years from 2015 to 2018, the Financial Accountability Office (FAO) said in an updated report Monday.

But the provincial treasury will lose $1.1 billion in dividends from Hydro One this year and an average of $264 million annually until the 2024-25 fiscal year.

The 40-page report fuelled opposition criticisms of the partial privatization of the Crown electricity transmission utility.

“It was all about making the books look good for the election,” said New Democrat MPP Peter Tabuns, referring to Finance Minister Charles Sousa’s promise to eliminate annual deficits this year, with voters heading to the polls June 7.

“We’re losing a lot of money on this privatization,” he added. “This will add to people’s views that this was a bad deal.”

Energy Minister Glenn Thibeault defended the sale, saying $4 billion of the proceeds is earmarked for projects such as light rail transit in several cities, and insisted private-sector discipline will make Hydro One more profitable.

“Our government broadened ownership to improve long-term performance of the utility, while unlocking the value in this asset to enable investments in transit and other major infrastructure projects that will help grow Ontario’s economy,” he added in a statement.

“The FAO’s report confirms that, as a publicly traded company, Hydro One is in a position to achieve efficiencies that will create savings for Ontario’s (electricity) ratepayers.”

Progressive Conservative finance critic Lisa MacLeod, MPP for Nepean-Carleton, said numbers in the report don’t back Thibeault’s claims.

“It would have been cheaper just to flat out borrow the money than it was to sell the shares,” she told the Star.

“We warned the Liberals it was a dumb move and now the Financial Accountability Office has proven it is.”

The report found Hydro One’s $6.7-billion purchase last year of Avista, a U.S. utility, could improve provincial finances “depending on the future profitability” of the company.

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Avista is based in Spokane, Wash., and operates in that state, and Oregon, Montana, Idaho and Alaska.

Wynne’s Liberal government, which has repeatedly boasts it has phased out heavily-polluting coal-fired power plants, came under criticism because Avista runs coal-based generating stations in Montana.

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