Ontario electricity rates increase as cost of living, power needs rise

Ontario electricity rates increased by around 29 per cent over this past weekend, but you may not have noticed.

That’s because the impact is being offset by an increase in the taxpayer-funded provincial rebate program, but that doesn’t mean you won’t be paying a little more.

An economist says this is another case of the cost of living going up.

He says we’re seeing an increase in costs for nuclear generation, natural gas and electricity rates as a result.

That means households will have to pay more out of pocket.

“The typical Ontario family is going to see an increase in their bill of between $5 and $10 a month,” said Colin Mang, an economics professor at McMaster University.

Mang says this rise in cost is a result of higher-than-expected nuclear generation costs and higher-than-forecast conservation program expenses in the province, and it adds up.

“This could translate into $60 to $120 per year, then you think about the fact that everything else is also going up in price, things like groceries, gasoline — this is one more thing families are going to have to spend money on,” said Mang.

The province is absorbing some of the rising electrical rates though.

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The Ontario Energy Board says the Ontario Electricity Rebate has risen to 23.5 per cent from 13.1 per cent, however Mang says this offset still burdens taxpayers.

“We have been funding this at about $6 billion a year,” said Mang. “With the increase of the rebate coming in, this is going to rise to $8 billion a year. That makes up the majority of the government’s deficit for the year.”

Mang says as the Ford government is planning massive increases in power generation and as it predicts it will need 75 per cent more electricity by 2050, the costs may continue to rise, but there is hope.

“As the economy continues to grow and as Ontario’s population grows, the cost to taxpayers of that rebate is going to increase,” said Mang. “We’ve seen the government try to invest in new electricity generation technology, particularly with nuclear, so hopefully what we will be able to see is some lower electricity costs in the future.”

The rebate increase is not in the fall economic statement that was presented Thursday.

Peter Bethlenfalvy, Ontario’s Finance Minister, says the next budget will reflect the increase.

“Of course, when I do Q3 and the budget shortly thereafter, we’ll update those numbers, but it should be in the order of magnitude of previous years,” said Bethlenfalvy.

The Ontario Clean Air Alliance put out a statement saying the Ford government is using the rebate to “bury the higher rates”.

Adding that it’s a “band-aid solution that does nothing to address the underlying reason for the rising rates: dependence on expensive nuclear power.

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