December 20, 2000
Hydro rates are going up.
The Ontario Energy Board (OEB) has approved a 2.6 per cent increase in hydro rates for Enersource Hydro Mississauga customers to take place immediately.
This means a residential consumer using the average of 1,000 kilowatt-hours of power will see the bill rise by $2.06 from its current $78.15 to $80.21.
The OEB approved only the first phase of Hydro Mississauga’s rate application. The utility has asked for an additional 1.49 per cent increase when the electricity market opens sometime next year, and then hikes of 4.18 per cent in 2002 and 2003.
That would represent a total increase for residential consumers of 12.54 per cent over three years. “Our rates are still extremely competitive, if not the best,” points out Ken MacDonald, Enersource public affairs manager.
The increase approved is necessary to provide a reasonable profit to the City of Mississauga which now owns the utility, MacDonald said. At the same time, the phased rate, “ensures that we do not burden customers.”
However, a spokesman for an energy watchdog organization predicts the increase is the beginning of the end for consumers.
Tom Adams of Energy Probe said the deregulation of the electricity industry in Ontario is, “turning into a major disaster for consumers.”
“We anticipate that when the music stops, the ordinary consumer will be paying prices about 20 per cent above our existing rates,” said Adams.
As the rates increase, the players will start pointing the fingers at each other to try to assign blame, said Adams.
His advice to consumers is to “keep your eye on the bottom line.” Keep your old bills and compare them with what you will be charged in future.
Adams thinks consumers should be upset about the “totally unnecessary” increases he blames on mistakes by the OEB and Energy Minister Jim Wilson. The minister should have anticipated that municipalities, who now have the right to operate utilities as profit-making commercialized entities, would take full advantage, argues Adams. The result has been “a huge hidden windfall” for municipalities who took cash out of utilities and put their utilities into debt.
“There’s a real risk that municipal politicians will treat this windfall as party money,” he said. While Toronto has already spent much of the money it took out of its utility, Adams said Mississauga has been much more responsible in putting its money into a separate account and not spending any of it.
MacDonald agreed with Adams that it’s possible energy costs could rise in the future.