Ontario electricity rates will remain unchanged, first time in nearly a decade

For the first time since 2008, hydro rates for residential customers in Ontario are not going up.

Ontario’s energy regulator, the Ontario Energy Board (OEB) conducts a price review twice a year.

In a statement released earlier this afternoon, the OEB announced that the per kilowatt hour charge that appears on the bills of residential customers in Ontario will not change for at least the next six months.

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“The prices set last May are still in line with the updated forecast cost of supply, enabling us to keep time-of-use prices level for the next six months,” said Ceiran Bishop, manager of supply and infrastructure at the OEB.

The decision comes on the same day Ontario’s energy minister, Glenn Thibeault, announced the provincial government has passed legislation to remove the provincial portion of the HST from electricity bills effective Jan. 1, 2017.

The government estimates the benefit received from the HST rebate will save average residential customers in Ontario $11 a month on their electricity bills – or roughly $130 a year.

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In total, the legislation will impact the monthly bills of more than five million residential customers in the province and cost upward s of $1 billion annually.

“The government recognizes the need to do more to ensure an affordable energy system for everyone and is committed to providing electricity rate relief that will benefit ratepayers in a meaningful way,” said Thibeault.

Hydro One, Ontario’s largest electricity distributor and provider of electricity to the majority of the province’s rural customers, believes continued rate increases are necessary to maintain a robust and reliable energy network.

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“Making sure we invest the money necessary so Ontario has the reliable, safe electricity system it requires, while doing everything we can to control costs is a balancing act our customers expect of us,” a spokesperson said.

“This year, Hydro One’s portion of the bill, the delivery line, went up by .04 % on average. We try to balance necessary investment with cutting the costs of doing business.”

Rates still may go up

Despite today’s decision announcing a freeze on current electricity rates, the price some residential consumers pay for electricity may still continue to go up over the next six months.

As a result of an order given by the OEB, Hydro One has begun the transition to fixed delivery rates.

Rather than pay a surcharge for delivery on every kWh of electricity used, Hydro One customers are moving toward a system in which they will pay a flat rate for delivery.

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While some consumers stand to benefit from this “fixed rate” system, particularly those residential customers who use a great deal of electricity, those who have managed to conserve energy and are now using less will see their bills increase.

For instance, Hydro One low-density customers who consume roughly 800 kWh per month could see their total bills increase as much as 3.4 per cent over the next 12 months.

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Meanwhile, low-density customers that consume 450 kWh a month could see their total bills go up by nearly six per cent as a result of the move toward fixed-rate delivery fees.

These increases do not, however, take into account savings as a result of the government’s HST rebate and enhanced rural subsidy program.