CanWest News Service
June 14, 2003

While electricity prices averaging 4.5 cents per kilowatt hour in May were significantly below what they have been, they were still above the frozen rate of 4.3 cents put in place by the provincial government last fall in the face of public fury over soaring power bills.

The latest financial data released Friday by the Independent Market Operator, which regulates Ontario’s electricity sector, show the cost of subsidizing electricity for about 53 per cent of Ontario’s market was also pushed up by the government decision earlier this year to expand the number of smaller firms eligible for cheap power.

A third factor accounting for the increase was the final adjustment for rebates retroactive to May 2002, when the Conservatives opened up the electricity generating market to competition, sparking major price increases.

Dan Miles, a spokesman for Energy Minister John Baird, said that additional nuclear and other generating plants scheduled to come into operation this summer "will have a dampening effect on price. We’re now into the 13th month of a 48-month plan (to keep prices frozen) and we believe that over the long term the plan will pay for itself."

But Tom Adams, executive director of the watchdog group Energy Probe, described that as "trash talk" given that the subsidy bill continued to increase even last month when the weather was mild and demand was average.

What’s more, he noted, Ontario’s troubled nuclear plants rarely meet start-up deadlines.

Adams warned that the subsidy cost is being "hidden" at the Ontario Electricity Financing Corporation, a Crown agency established to manage new debt arising from the power sector and old debt left over from the former Ontario Hydro.