Reliance Home Comfort

Last updated
Reliance Comfort Limited Partnership
Reliance Home Comfort
Company type Limited partnership
Predecessor Union Gas water heater rental division
Founded1999;25 years ago (1999) (as Union Energy)
Headquarters
Toronto, Ontario
,
Canada
Areas served
 Ontario and major cities in Western Canada
Key people
Sean O'Brien (CEO)
Products Water heater and HVAC rental, sales and service
Owners CK Asset Holdings (75%)
CK Infrastructure Holdings (25%)
Website reliancehomecomfort.com

Reliance Home Comfort is a residential and commercial services company headquartered in Canada primarily focused on rental, sales and maintenance of water heaters, water purification, smart home and heating, ventilation, and air conditioning systems. The company has its largest base of operations in Ontario, but also has offices in western Canada and the United States. As of 2017, it served 1.7 million customer households across Canada. [1]

Contents

Reliance is currently controlled by the family of Hong Kong-based Chinese-Canadian businessman Victor Li and his father Li Ka-shing, through two of their holding companies, CK Asset Holdings (75%) and CK Infrastructure Holdings (25%). [1]

History

Reliance has its origins in the storage water heater rental business formerly owned by natural gas utility Union Gas, which served much of Ontario. [2] Reliance's main Ontario competitor, Enercare, has a similar origin as the rental business of Toronto-area utility Consumers' Gas. [3] (The utility operations of both Union and Consumers' are now part of Enbridge. [4] [5] )

Beginning in the mid-20th century, Ontario gas providers such as Consumers' and Union would work with home builders to pre-install gas-powered water heaters, which the providers would agree to subsidize and maintain in exchange for a monthly rental charge on each homeowner's gas bill. [3] This practice of renting water heaters, as opposed to purchasing them, became widespread in Ontario, but is not common elsewhere in Canada. [6] [7]

Due to regulatory changes, Union Gas' unregulated water heater business was split off in 1999 as a sister company named Union Energy. [8] [9] Union Energy was then acquired in 2001 by Epcor for about $160 million, [9] later also acquiring Hydro One's retail rental division Ontario Hydro Energy. [10] The combined operation was then spun off as the UE Waterheater Income Fund in 2003. [11] Beginning in 2005, the company converted its retail operations to the new Reliance Home Comfort brand, as its brand licensing rights from Union Gas and Hydro One were close to expiring. [12] The fund was purchased in 2007 by Alinda Capital Partners for $1.74 billion. [13]

Around the time of the Alinda purchase in 2007, Reliance also purchased security companies Voxcom and Protectron, operating them under the "Reliance Protectron" name until selling the operations to ADT in 2014. [13] [14] ADT Canada was subsequently acquired by Telus in 2019. [15]

Since the sale of Protectron, Reliance has refocused on home maintenance services, including expansion into western Canada. It also acquired competitor National Home Services from Just Energy in 2014. [6] Reliance was then purchased from Alinda by the CK group in 2017 for $2.8 billion. [1]

Products and services

In addition to water heater rentals (and sales in some areas), Reliance sells, rents, installs, and maintains furnaces and air conditioners. [1] It also offers maintenance and repair plans for heating and cooling systems, as well as for plumbing and electrical systems. [16]

Criticism

Although not specific to Reliance, the water heater rental business model has been noted as being a poor value for many consumers. The federal Competition Bureau has noted that purchasing a water heater outright "can result in substantial savings over time" compared to rental. [6] However, Reliance and other rental companies argue that because their rentals include maintenance, including replacement parts and labour, they can provide peace of mind for consumers. [7]

The Competition Bureau filed complaints against Reliance and Direct Energy (then-owner of what is now Enercare) in 2012, alleging both companies engaged in anti-competitive behaviour by providing customers limited locations and time windows if they wished to return their rentals, and charging "unwarranted" cancellation fees. Reliance defended its policies, asserting that it was intended to help protect consumers against what it called aggressive tactics by competing rental suppliers. [17] The company settled its part of the complaint in 2014 by agreeing to make it easier for customers to cancel their rentals and paying a $5 million administrative penalty. [18]

Some homeowners have alleged that Reliance has used fallacious collections actions to attempt to extract payments for goods and services not provided. [19]

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References

  1. 1 2 3 4 Willis, Andrew (March 31, 2017). "Li family buys Reliance Home Comfort for $2.8-billion". The Globe and Mail . Retrieved September 14, 2020.
  2. ↑ "Water Heaters, Rent or Buy?". Salmon Plumbing. 21 September 2019. Retrieved September 14, 2020.
  3. 1 2 "Enercare: Who We Are". Archived from the original on October 24, 2020. Retrieved September 15, 2020.
  4. ↑ Nguyen, Lily (March 28, 2001). "Takeover energizes Enbridge". The Globe and Mail . Retrieved September 14, 2020.
  5. ↑ "Enbridge and Spectra Energy Complete Merger". Enbridge Media Centre. Enbridge. February 27, 2017. Retrieved October 10, 2017.
  6. 1 2 3 Competition Bureau (press release) (November 17, 2014). "Competition Bureau clears Reliance's acquisition of National" . Retrieved September 14, 2020.
  7. 1 2 Engen, Robb (June 10, 2014). "Pros and cons of renting vs. buying a water heater". Toronto Star . Retrieved September 16, 2020.
  8. ↑ "Union Gas". energyrates.ca. Retrieved September 14, 2020.
  9. 1 2 Parkinson, David; Stueck, Wendy (October 23, 2001). "Epcor Utilities snaps up Westcoast Energy units". The Globe and Mail . Retrieved September 14, 2020.
  10. ↑ "Union Energy Inc. purchases retail assets from Ontario Hydro Energy Inc". Power Grid International. April 25, 2002. Retrieved April 25, 2023.
  11. ↑ "Epcor files for IPO of water heater business". The Globe and Mail . November 11, 2003. Retrieved September 14, 2020.
  12. ↑ "UE Waterheater Income Fund introduces new consumer brand identity: Reliance Home Comfort [News release - June 14, 2005]". June 14, 2005. Retrieved April 25, 2023.
  13. 1 2 Valorzi, John (April 16, 2007). "Alinda to buy UE Waterheater for $1.74B". Toronto Star . Retrieved September 14, 2020.
  14. ↑ Erman, Boyd (April 30, 2014). "ADT secures larger Canadian market share in Protectron deal". The Globe and Mail . Retrieved September 16, 2020.
  15. ↑ "Telus buys Canadian operations of home security firm ADT for $700M". CBC News . October 2, 2019. Retrieved September 16, 2020.
  16. ↑ Reliance Home Comfort. "Maintenance and Protection Plans" . Retrieved September 16, 2020.
  17. ↑ "Water heater companies targeted by competition watchdog". CBC News . December 20, 2012. Retrieved September 16, 2020.
  18. ↑ Competition Bureau (press release) (November 6, 2014). "Competition Bureau strengthens competition in Ontario's water heater industry" . Retrieved September 16, 2020.
  19. ↑ CBC News (February 14, 2022). "Collection agencies hound seniors for rental water heater they never agreed to" . Retrieved February 14, 2022.
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