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Ontario Cutting Electricity Bills by 25 Per Cent

System Restructuring Would Deliver Lasting Relief to Households in Scarborough-Guildwood

March 4, 2017 - Ontario is lowering electricity bills by 25 per cent on average for all residential customers as part of a significant system restructuring that will address long-standing policy challenges and ensure greater fairness.

Starting this summer, Ontario’s Fair Hydro Plan will provide households with this 25 per cent break. Many small businesses in Scarborough-Guildwood will also benefit from the initiative. People with low incomes will receive even greater reductions to their electricity bills. As part of this plan, rate increases over the next four years will be held to the rate of inflation for everyone.

These measures include the eight per cent rebate introduced in January, and build on previously announced initiatives to deliver broad-based rate relief on all electricity bills.

Taken together, these changes will deliver the single-largest reduction to electricity rates in Ontario’s history.


Recently, electricity rates have risen for two key reasons:

  • Decades of under-investment in the electricity system by governments of all stripes resulted in the need to invest more than $50 billion in generation, transmission and distribution assets to ensure the system is clean and reliable
  • The decision to eliminate Ontario's use of coal and produce clean, renewable power, as well as policies put in place to provide targeted support to rural and low-income customers, have created additional costs.

The burden of financing these system improvements and funding these key programs has unfairly fallen almost entirely on the shoulders of today’s ratepayers. To relieve that burden and share costs more fairly, two system fixes are being undertaken.


Recognizing that the electricity infrastructure that has been built will last for many decades to come, the province would refinance those capital investments to ensure that system costs are more equitably distributed over time. In addition, a number of important programs, such as the Ontario Electricity Support Program (OESP), will now be funded by the government instead of by ratepayers.


The province will also launch a new Affordability Fund, enhance the existing OESP and Rural or Remote Rate Protection (RRRP) program and provide on-reserve First Nations households with a delivery credit. These new measures will cost the government up to $2.5 billion over the next three years.

Notwithstanding that hydro rate relief costs will add significant pressure on the fiscal framework, the province continues to project a balanced budget for 2017-18, and will provide a full update on its fiscal plan in the spring budget.

Reducing electricity costs in Scarborough-Guildwood is part of Ontario’s plan to create jobs, grow our economy and help people in their everyday lives.

Quick Facts

  • Ontario’s Fair Hydro Plan will improve sector efficiency and modernize the province’s electricity market, working in collaboration with the Independent Electricity System Operator (IESO) and the Ontario Energy Board (OEB).
  • The Province will expand the RRRP to provide distribution charge relief to additional customers served by LDCs with the highest rates. About 800,000 customers would benefit from the enhanced RRRP program.
  • The Affordability Fund will be accessible to Local Distribution Companies (LDCs) for customers who do not qualify for low-income conservation programs and who are unable to undertake energy efficiency improvements without financial assistance.
  • On-reserve First Nations customers will receive a 100 per cent credit of the delivery line on their monthly electricity bills.
  • The expanded OESP will provide an additional $180 to $276 per year for households of eligible size and combined income.
  • Ontario is expanding the Industrial Conservation Initiative (ICI) program by reducing the threshold from 1 mW to 500 kW and targeting more small manufacturing and industrial consumers.

Learn More

  • Learn how Ontario is developing the next Long-Term Energy Plan.

Quote

“Scarborough-Guildwood residents have expressed their concern about the cost of hydro and the impact it has had on their household budgets. Electricity is an essential part of our everyday lives. I am very pleased that through Ontario’s Fair Hydro Plan, our government has taken significant action to address these concerns. Our Plan will lower hydro bills by an average of 25% and will limit future increases to 2% per year for the next four years. This is definitive action that adds up to real savings for families, seniors and small businesses in Ontario.” - Mitzie Hunter, MPP for Scarborough-Guildwood

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