Electricity prices for Ontario households will rise about 4.3% for the commodity portion of the bill starting Nov. 1. The Toronto Sun has some coverage here.
This increase applies for the next 6 months. The last increase for the commodity portion of the bill kicked in May 1 and was 6%.
The non-commodity portion of the power bill — particularly the charges for transmission and distribution — are also rising very steeply. For example, Toronto Hydro has a proposal now before the Ontario Energy Board seeking distribution rate increases for households of 18.7% in 2012, 12% in 2013, and 12% in 2014.
The increase was announced by the Ontario Energy Board. Those concerned by the increase should recognize that the cause of the increase is not the Ontario Energy Board but the rising underlying costs of Ontario’s power system.
One key driver for escalating cost is the Green Energy Act. When the Act was introduced, then energy minister George Smitherman, promised that it wouldn’t make rates go up more than 1% per year. It is now obvious that the Green Energy Act alone is driving up rates at many times that rate.
Some advocates for the Green Energy Act would have you believe that power rates for everyone are going up. Not true.
The average cost of power in Ontario for households passed the U.S. average in 2009. Since then, their rates have dropped. The U.S. government’s well respected Energy Information Administration forecasts that household power rates in the U.S. will keep dropping over this decade. Meanwhile, Ontario rates have just got started a wild ride upward. Look for overall rate increases of at least 8% per year for the next several years.
One impact of the increase announced yesterday is that it will increase the provincial deficit. The Ontario government instituted a program earlier this year, called to Ontario Clean Energy Benefit, which transfers 10% of household, farm and small business bills to the provincial government’s account to be paid by taxpayers.