Toronto: Ontario electricity prices increased twice as fast as the national average over the past decade, and the average Toronto resident now pays $60 more per month than the average Canadian for electricity, according to a new study released July 20 by the Fraser Institute, an independent, non-partisan Canadian policy think-tank.
"Electricity is a necessity, and Ontario's high prices pose a serious burden for many families who, after paying their hydro bills, have significantly less money to spend on other important priorities," said Kenneth Green, Fraser Institute senior director of energy and natural resource studies and co-author of Evaluating Electricity Price Growth in Ontario.
The study also finds that electricity prices in Ontario increased 2.5 times faster than Ontario income levels between 2008 and 2015 (the latest year of income data). In fact, electricity prices rose 71 per cent (from 2008 to 2016), more than double the national average increase of 34 per cent over the same time. Consequently, the Institute says, Ontario cities have some of the highest monthly electricity bills in Canada.
For example, residents in Toronto (the city with the highest price anywhere in Canada) pay, on average, $201 per month (including taxes) – an increase of $77.09 over the past six years. Ottawa residents pay $183 per month. That’s compared to monthly electricity bills in Montreal ($83), Calgary and Edmonton ($109), and Vancouver ($114).
The study finds that Ontario's high prices are directly tied to the provincial government's phase-out of coal energy, “poorly structured” long-term renewable energy contracts and other policy choices.
What's more, the Institute says, to address the high costs faced by residents, Queen's Park has recently announced a plan to use debt-financing to “artificially” lower current electricity prices. However, this plan will result in new charges being added to future bills.
"The Ontario government and its energy policy decisions share a lot of blame for the current crisis in electricity prices," Green said.