Richard Brennan
Toronto Star
February 23, 2005

Announcement coming on day of federal budget
Ontario energy minister set to reveal new prices

The Ontario government is trying to sneak through an electricity rate increase today while attention is on the federal budget, critics charged yesterday.

"Why are you trying to hide such an important announcement and bury it on federal budget day?" NDP Leader Howard Hampton said in the Legislature yesterday, later accusing the Liberals of trying to "sneak through the rate hike."

"This is an important announcement for industry. It’s an important announcement for business. It’s an important announcement for workers. It’s an important announcement for families who have to pay their hydro bills," Hampton said.

Details of the new price structure are to be announced today by Energy Minister Dwight Duncan and will be based on the regulated price for power produced by Ontario’s nuclear plants and river dams, about 41 per cent of the electricity generated in the province. The new price will be reflected in the residential and business price to be announced May 1. Large industrial users will pay the new price immediately.

"It is my understanding that it does not affect residential consumers (right away)," Premier Dalton McGuinty said.

Duncan refused to confirm rate increases yesterday and denied the government was trying to hide behind the federal budget. "Let’s see what the news is before we cast that kind of aspersions," said Duncan. "There is no attempt to hide anything."

But Duncan said Ontarians have to get used to paying the "true cost of electricity" after the real cost is factored in. "It will reflect the true cost of electricity, which is something we have been saying for some time," Duncan said.

Conservative MPP John O’Toole (Durham) accused the Liberals of using the federal budget as a "smokescreen to hide yet another increase in electricity rates." "Whether the announcement comes today, tomorrow or later this month, this minister of energy can’t keep Ontarians in the dark. Electricity prices are going up," O’Toole said in a statement.

During the 2003 provincial election, the Liberals promised to cap electricity prices, but broke that promise weeks after being elected. Some are saying they are ready to do another turnabout.

Tom Adams, of Energy Probe, predicted the Liberals "are moving toward total re-monopolization of the power system," because the hybrid system of provincially owned and private generation was not working. That means two-thirds of the electricity produced in the province by Ontario Power Generation would be regulated again, which the Liberals said they wouldn’t do.

Hampton, who wrote the book Public Power, said using the federal budget may have more to do with the fact the government is backing off, or "flip-flopping" on its decision to open up the market. "The reason they want to hide this announcement is they realized they can’t do that (de-regulate part of OPG), so tomorrow you are going to see another McGuinty flip-flop."

"What they are going to announce is that of the OPG assets — all of the hydro stations, all of the coal stations, all of the OPG nuclear stations — are going to operate according to a very low regulated price … about 4.7 cents a kilowatt hour," he said.

Hampton said the government has realized that unregulated prices would have killed jobs and hurt residential consumers.

"They are going to do what Duncan said initially he wouldn’t do," said the NDP leader said, who favours a regulated environment.

with files from canadian press