Energy Probe

Doug Alexander
Bloomberg.com
January 25, 2005

Ontario needs to reconsider its resistance to coal as an energy source with the government pledging to phase out coal-fired power plants by 2007, the head of the new provincial power authority said.

"I don’t see that coal is necessarily ruled out providing it can be used in a more environmentally acceptable format than the present technology allows," Jan Carr, appointed to lead the Ontario Power Authority two weeks ago, said at a conference in Toronto.

Carr’s comments may be at odds with Premier Dalton McGuinty’s promise to shut down Ontario’s five coal plants, which produce 25 percent of the province’s electricity. Ontario faces energy shortages because there aren’t enough new power projects being built to replace the electricity produced by coal, according to a report for the provincial energy ministry.

"It’s just a matter of time before the McGuinty government is forced to admit the obvious: that they cannot meet their promise," said Tom Adams, executive director of Energy Probe, a research group that advocates energy conservation. Phasing out coal "is not achievable."

Ted Gruetzner, a spokesman for the energy ministry, said the government is "committed" to shutting down its coal operations by 2007.

Carr said technological advances in the next 20 years could make coal a viable, less-polluting energy source.

Ontario needs to add 25,000 megawatts of generating capacity by 2020 at an estimated cost of C$25 billion ($20.2 billion) to C$40 billion. One megawatt of electricity is enough to light 1,000 homes.

The Ontario government is reviewing proposals for new power projects that generate as much as 2,500 megawatts in the next two years. A C$900 million refurbishment of a reactor at Ontario Power Generation Inc.’s Pickering A nuclear station, scheduled to be restarted by July, will add another 515 megawatts.

The government set up the Ontario Power Authority earlier this month to oversee long-term planning of the province’s energy needs and to supervise the electrical transmission and generation systems. The agency also can award contracts to private companies wanting to build power facilities.

Lee Greenberg
National Post
February 1, 2005

Ontario’s plan to phase out coal-fired generating plants by 2007 is based on bad science, a report released yesterday states.

The study, commissioned by conservative think-tank the Fraser Institute, urges the government to abandon its coal decision, which author Kenneth Green says was made in a "hasty and unexamined" way.

Mr. Green, the Fraser Institute’s chief scientist, writes that "closing the coal-fired plants will imperil industrial development in Ontario, increase energy costs, and reduce the reliability of the electricity supply."

Coal-fired plants account for about one-quarter of Ontario’s electricity supply, equal to 7,000 megawatts. Energy Minister Dwight Duncan has announced plans to bring about 4,800 MW of new generation online by the cut-off date. At the same time, experts are cautioning of a looming electricity supply crisis, with two-thirds of the province’s generating capacity becoming obsolete in the next 20 years.

Mr. Green said the decision to abandon coal, taken by the Liberals while in opposition, was based on selective science and should be re-evaluated.

The study attacks two studies by the Ontario Medical Association and the Toronto Board of Public health that claim air-pollution levels kill thousands of people in the province every year.

Researchers ignored several U.S. studies that linked higher pollution with lower mortality rates, the study states, calling the practice tantamount to scientific "cherry-picking." "There’s no convincing evidence those plants are causing damage to people’s health or their property," Mr. Green said in an interview.

"There is no question that coal-fired plants contribute to Ontario’s air pollution emissions. The question is whether the harm associated with these emissions exceed the social and economic benefits of the electricity they provide."

Anti-coal proponents derided the report. "It’s just not true," said Jack Gibbons, chair of the Ontario Clean Air Alliance. "According the Ontario Medical Association, air pollution is a public health crisis in Ontario that’s killing over 2,000 people a year in the province. And I believe that the OMA is a much more credible source on public health issues than the Fraser Institute." Mr. Gibbons said Ontario’s five coal-fired plants produce as much pollution as 6.2 million cars and are responsible for 20% of Ontario’s smog. "Coal-fired power plants are a 19th Century technology that have no place in 20th Century Ontario."

But Tom Adams, executive director of Energy Probe, an industry watchdog opposed to nuclear generation, called the report worthwhile. "I think there are areas of environmental policy where a real consideration of the cost and benefits have not been taken into account."

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

Canadian Press
CJAD 800 am
February 23, 2005

Toronto: Residential electricity users in Ontario can expect rebates of $50 to $100 a household this spring, Energy Minister Dwight Duncan announced Wednesday as he hiked the cost of hydro for large, industrial customers.

"Small consumers, farms, small businesses can expect, as of today, approximately a $300-million rebate," he said.

Duncan said the province "had some good luck" with the weather in the past year, which allowed electricity prices to fall 19 per cent below what the government predicted they would be when it set a new price plan last April.

He said Ontario’s large industrial users will pay more for electricity starting April 1 under a new scheme that regulates rates for most of the power used by the large industries that until now had been relying mainly on the unregulated spot market.

Industries will pay 12 per cent more than they did last year when weather was moderate, but just 1.5 per cent more than they did in 2002-2003, the first year the province’s electricity market was thrown open to competition.

Duncan said the new pricing system is intended to more accurately reflect the cost of producing electricity.

It will be used by the Ontario Energy Board to calculate new electricity rates for the province’s four million homeowners, also effective April 1.

"My estimation is that it will be well below five per cent," Duncan predicted about the size of the residential rate hike.

"For too long, taxpayers subsidies have kept electricity prices unsustainably low."

"It’s a step in the right direction," said Jack Gibbons of the Clean Air Alliance. "It’s not right to use taxpayers’ dollars to subsidize electricity consumption."

The business community agreed hydro consumers should pay the true cost of generating electricity, but the Ontario Chamber of Commerce said the government isn’t doing enough on its hydro file to keep businesses competitive.

"Business leaders in Ontario are worried that the government appears to be floundering on the energy file," said Len Crispino, the chamber’s president and CEO.

The Association of Major Power Consumers in Ontario said it supported the changes Duncan introduced, but warned a lot needs to be done to restore investor confidence in the province.

"It will be difficult for many companies to absorb a sudden cost increase that extends well into the double digits," said AMPCO chair Mike Kuriychuk.

"Serious attention to mitigation will be necessary to avoid adverse impacts on investment and employment."

The price hike for Ontario’s 55,000 large industrial and commercial electricity customers was smaller than expected.

New Democrat Leader Howard Hampton said that pushing the cost of electricity any higher would have crippled some Ontario companies and put them out of business.

"It would potentially mean the loss of tens of thousands of good paying jobs in Ontario," he said.

The average price of electricity will be 4.5 cents per kilowatt-hour for power generated by nuclear plants and large river dams owned by the government’s Ontario Power Generation, which generate 40 per cent of the province’s electricity.

Duncan also set a new price limit of 4.7 cents per kilowatt-hour on most of the output from OPG’s so-called unregulated assets, smaller dams, coal and gas-fired plants, accounting for another 33 per cent of the province’s generating capacity.

"What this is, is a gigantic bailout for OPG," said Tom Adams of the environment group Energy Probe. "This is a way of patching up OPG and allowing OPG to grow again."

However, the price for electricity from OPG’s unregulated assets is only for one year while the province replaces the previous government’s Market Power Mitigation Agreement.

That agreement, which gave rebates to large power users, cost Ontario taxpayers $100 million a month, or $3.3 billion dollars since it was implemented.

"We have stemmed what can only be called a hemorrhage of $100 million a month that was designed to force a government to sell the very assets that we don’t think we should sell," said Duncan.

"This sort of one-year, make-it-up on the back of an envelope, is not an answer for industry, business or the Ontario economy," charged Hampton.

"I think the Power Mitigation Agreement was working and they should have left it in place," countered acting Opposition leader Bob Runciman.

He said industry and large businesses can’t absorb huge jumps in hydro bills. "The real concern here is with the big users and the job creators in the Ontario economy," he said.

John Spears and Richard Brennan
Toronto Star
February 24, 2005

Ontario’s Liberal government has given the price of electricity a gentle nudge that will moderate expected price increases for large industrial power users, but pump up revenues for Ontario Power Generation Inc.

The government’s help in keeping a drag on power prices was gratefully acknowledged by chief executives of two of the province’s biggest power users – Inco Ltd. and Dofasco Inc. However, power prices for big industrial users are still likely to rise about 12 per cent in the coming year, according to government estimates.

This spring, householders can expect to get rebates totalling $300 million on their hydro bills – between $50 and $100 per customer. The rebates come because consumers have been paying slightly more than the actual cost of power for the past year.

The provincial Liberal government decided last year that householders and small businesses would pay 4.7 cents a kilowatt hour for the first 750 kilowatt hours of power used each month, and 5.5 cents a kilowatt hour for all other power. A new price is due to be set sometime in the spring.

Consumers have paid about 5.2 cents a kilowatt hour on average for power under the new system, while the average market price has been 5.1 cents. That resulted in an overpayment of about $300 million. The final amount will be calculated at the end of March and consumers will get the refund through a credit on their hydro bill.

Opposition critics said the Liberals are still fumbling on policy.

"It’s clear the McGuinty government still doesn’t have a plan for Ontario’s hydro-electricity system," said New Democratic Party leader Howard Hampton.

Duncan announced yesterday that power produced by Ontario Power Generation’s regulated assets, its nuclear plants and major hydro-electric facilities, will be priced at 4.5 cents a kilowatt hour for the next three years.

The nuclear and big hydro plants churn out 41 per cent of Ontario’s power.

But Duncan also said he’ll put a one-year price cap of 4.7 cents a kilowatt hour on the output of OPG’s "unregulated" assets – mostly small hydro facilities and coal-burning plants that produce another 33 per cent of the province’s power.

Until now, the Liberals had indicated that a portion of OPG’s production would be allowed to float up to open market rates.

But even with the new price caps, OPG’s effective prices will go up.

That’s because the new price caps replace an old system in which OPG had to refund a substantial chunk of revenue when prices exceeded 3.8 cents a kilowatt hour.

The old rebate system meant OPG was refunding industrial customers about $100 million a month, Duncan said. The new system will let the company keep about half of what it’s now giving away.

That should allow OPG to earn about $350 million in profit each year, Duncan said. The profits will help pay down the debt left by the former Ontario Hydro.

Duncan told reporters the one-year price control on OPG’s "unregulated" assets is a transitional measure to ease businesses toward higher prices.

"We want to make sure the fundamentals are in place, that there’s predictability and stability," he said.

The new system "raises prices significantly, but it does so in a responsible fashion."

Chief executives Scott Hand of Inco and Don Pether of Dofasco said that, by holding OPG’s prices in check, the government recognized "the need for competitive electricity costs to support the sustainability of manufacturing in Ontario."

Mike Kuriychuk, who chairs the Association of Major Power Consumers of Ontario, called the announcement "good news in the sense it produces some stability," although it will push up energy costs for business.

One concern is whether there is any significant electricity market left in Ontario. The province has set the price for OPG’s 73 per cent of production; another 8 per cent is covered by long-term contracts with private generators.

"I have heard comments from marketers and investors that there’s very little left of the open market," Kuriychuk said. "In the short term, at least, I think it will dampen the enthusiasm for new investment."

Duncan insisted he’s "confident . . . people will still say this is a darn good place to invest."

Hampton said without the government’s tinkering, power prices for big steel, automotive, paper and mining companies were set to rise by as much as 15 cents a kilowatt hour.

Conservative MPP Bob Runciman said that "only a Liberal would suggest that an 8 to 12 per cent (price) increase is good news."

Both opposition parties accused the Liberals of burying the announcement by making it the same day as the federal budget.

Tom Adams of Energy Probe also accused the government of "winging it" on energy policy.

He noted yesterday’s announcement cloaked impending price increases that will stem from rate increases being sought by local hydro utilities, and other cost pressures such as the province’s $1 billion program of installing new electricity meters in every home.

Prices could rise by 30 per cent or more by 2007 when all costs are included, he predicted.

John Partridge
The Globe and Mail
March 8, 2005

Canada has enough electricity to meet demand for the time being, but even power-rich Quebec and British Columbia face potential problems down the road, Toronto-Dominion Bank says.

In fact, like most other regions across the country, Quebec and B.C. have already experienced a deterioration in supply-demand positions in recent years as shown by a combination of declining power exports, rising imports and dropping reserve margins, TD said yesterday in a report on electricity in Canada.

"We hear a lot about Ontario . . . but even provinces that we think of as being very rich in terms of electricity supply are also looking at challenges going forward," TD senior economist Derek Burleton, one of the study’s authors, said in an interview. He was alluding to the August, 2003, power blackout that paralyzed Ontario and eight U.S. states, as well as warnings by the province that demand for electricity will outstrip supply as early as 2007 if present trends continue.

As well as seeking out new sources of supply, the electricity sector will need to spend massive amounts of money to upgrade aging power transmission and distribution networks, while major expenditure also will be required just to accommodate soaring economic growth in such areas as Alberta, Newfoundland and Labrador and the Northwest Territories, the report said. It cited a 2003 estimate by the Canadian Electricity Association that it will cost a total of $150-billion in public and private funds over the next 20 years to make sure the power system is reliable.

However, government authorities also must encourage conservation, in particular by moving further toward market-based pricing for electricity, the report says.

It argues that electricity prices must be allowed to increase in order to improve efficiency, attract private sector investment and "hence assist in averting a full-blown power crisis in the longer run." Such a crisis, it added, "would almost certainly entail a much more painful price adjustment and more significant adverse economic impacts."

The report cites Alberta as a case in point. It says that after deregulation in the late 1990s, electricity prices initially soared by about 60 per cent but have since "fallen back close to their prederegulation levels, spurred by a surge in private sector investment in new [power] generation."

Mr. Burleton said ensuring the power system’s reliability is vital because it is "so fundamental to the future health of this economy and the quality of life."

The TD report came as Energy Probe, a Toronto-based energy watchdog, warned that "significant portions" of Ontario’s electricity transmission and distribution infrastructure have reached "an advanced state of disrepair" and, in some cases, "appear to present a danger to public safety."

In its report, Energy Probe criticizes the Ontario Ministry of Energy for ignoring the aging infrastructure issue in a review of transmission and distribution that it issued in December.

Energy Probe, a staunch opponent of nuclear power, contends that the system deteriorated on "a vast scale" because the former Ontario Hydro for decades "mined its transmission assets" and diverted funds that should have been invested in these assets to a nuclear generation program and to "uneconomic aspects" of fossil fuel power generation.

John Spears
Toronto Star
March 8, 2005

Ontario has opened 18 potential hydroelectric sites for bids from companies that want to develop them, says Natural Resources Minister David Ramsay.

If developed, the sites should yield an additional 200 to 300 megawatts of total generating capacity, most of it in Northern Ontario, Ramsay said.

Ontario is desperately searching for ways to generate more power, as consumption has been rising at a rate of about 1.5 per cent a year while the province’s fleet of generators is showing its age.

The province is due to shut down about 7,500 megawatts of coal-fired generating capacity by 2007.

Another 10,000 megawatts of nuclear generating capacity will reach the end of its normal life by 2018.

On a day of peak demand, Ontario uses about 25,000 megawatts of power.

The hydro sites were winnowed from proposals invited by the province last November.

Companies that want to develop any of the sites now have 120 days to submit formal proposals to the ministry.

Paul Norris of the Ontario Waterpower Association called Ramsay’s announcement "a good first step."

He said if everything goes smoothly, the first generating facilities on the new hydro sites could be in place by 2007.

Ramsay told reporters that water "will undoubtedly continue to be Ontario’s most important source of clean, renewable energy."

Energy Minister Dwight Duncan has claimed Ontario has enough sites scattered around the province to add 3,000 to 6,000 megawatts of generating capacity to the Ontario grid.

Others are skeptical.

Tom Adams, executive director of Energy Probe, said successive provincial governments have talked about developing new hydro sites for the past 20 years.

Yet few have been built, he said, even in the late 1980s and early 1990s when Ontario Hydro was trying to entice private companies to develop hydro stations with financial incentives.

"Anything that’s worth doing has pretty well been done," Adams said.

Remaining sites are mostly small scale, and many are in remote locations that aren’t close to transmission lines, he said.

Ramsay also said that starting April 1, companies will have six months to submit proposals for wind power developments on Crown land in the province. In January, the province awarded permits to develop 355 megawatts of wind generation.

"There could be as much as 3,000 megawatts of wind power capacity on private and Crown land across Ontario," Ramsay said.

The province currently has only 10 operating turbines, generating a total of 14.6 megawatts of power.

On selected sites, applicants will be allowed to set up a test turbine for a year to get detailed data on wind patterns. If the site still seems suitable, a full environmental assessment would follow.

A wind atlas recently published by the federal government shows that Ontario is generally a poor location for wind farms.

But Ramsay said the federal wind atlas has been mapped on a very broad scale, and detailed research is likely to show specific locations with good wind potential.

John Spears
Toronto Star
March 8, 2005

Ontario’s electricity transmission wires are more than half a century old and "appear to present a danger to public safety," says a report prepared by watchdog group Energy Probe.

"There is now a significant risk of prolonged customer blackouts in the event of severe weather," it warns.

The report cites an assessment prepared by Ontario Hydro in 1997, shortly before the company was broken into separate generation and transmission units.

At the time, company officials noted that many hydro lines "were built in the late 1940s after World War II and are now approaching the end of their useful life. . . . As the condition of these lines is allowed to deteriorate beyond their useful life, without any remedy, the exposure to safety hazards will increase and public safety will be compromised."

Most of Ontario’s transmission system is operated by the provincially owned Hydro One.

Hydro One spokesperson Peter Gregg said in an interview that the Energy Probe report doesn’t mention all of the company’s activities since the 1997 report.

"We’ve been actively investing in the reliability of the transmission and distribution system," he said.

Energy Probe notes that the Ontario Energy Board, which regulates Hydro One, slashed the company’s spending on asset renewal in 1999.

It then asked for a detailed assessment of the condition of the company’s assets to be prepared by 2001, but the assessment has never been presented.

Energy Probe says a discussion paper on the province’s transmission system prepared for the energy minister late last year misunderstands the scope of the problem.

The ministry says growth in power demand is putting stress on the transmission system, when, in fact, decades of under-investment in the system is to blame, Energy Probe argues. The backlog now amounts to billions of dollars of work, it says.

Gregg said Hydro One has spent heavily on its transmission system, investing $289 million in capital equipment in 2003 and $260 million in 2002.

The 1997 Ontario Hydro report "was eight years ago," he said. "It’s a new company since then."

In Toronto, Hydro One is building an underground link to connect the eastern and western halves of the city to improve the flow of power, Gregg said.

It has also built a big new transformer station to compensate for the impending loss of the Lakeview generating station, due to close next month.

Jason Ballantyne
Simcoe County Online
March 18, 2005

It’s not an April Fool’s joke – starting April 1, the average homeowner will be charged about $3 to $4 a month more for electricity. The rate increase was calculated by the Ontario Energy Board. The energy board announced Monday that, as of April, householders will pay five cents a kilowatt hour for the first 750 kilowatt hours of power they use each month, and 5.8 cents for all other power.

That’s up 0.3 of a cent from the current rate of 4.7 cents for the first 750 kilowatt hours, and 5.5 cents for other power – or $3 a month for a consumer using 1,000 kilowatt hours a month. The new rate will be effective for a year.

On top of that, Barrie Hydro has asked the energy board to approve an additional rate hike.

George Todd, head of Barrie Hydro, said the increase his utility is waiting approval on would mean an additional $2 a month for the average homeowner using 1,000 kilowatt hours a month. Todd said the pending rate hike was actually part of a three-stage plan that was frozen in the third stage by the previous Tory government.

The Liberal government has now allowed utilities to move forward in implementing the third and final phase.

Todd said the hike, if approved, would generate about $1.9 million for the utility, which then has to be reinvested within the next year in conservation and demand management initiatives.

Consumers will have to brace for another price change as utilities begin to install ‘smart meters’ that can charge different rates for power used at different times of day.

Once they get a smart meter, consumers will pay up to 9.3 cents a kilowatt hour on the energy portion of their bill – double today’s lower-tier rate.

The energy portion makes up about half the current electricity bill. The remainder covers the cost of the wires that deliver the electricity, plus administrative fees and a special charge to pay down the debt left by the former Ontario Hydro.

Consumers can still opt to sign a fixed-price contract with an energy retailer.

Critics complained that the looming price changes will confuse consumers.

"It’s sort of like reading a Da Vinci’s Code," said Conservative energy critic John O’Toole.

"It’s virtually impossible for a consumer to have a way of understanding what they’re paying for electricity – or why," said Tom Adams, executive director of Energy Probe.

But Dave Martin of Greenpeace Canada said the announcement is "clearly moving in the right direction" by pushing prices to a more realistic level that doesn’t subsidize consumption.

New Democratic Party Leader Howard Hampton noted that it’s the second price increase in a year, breaking the Liberals’ 2003 election promise that they will freeze prices until 2006.

Energy Minister Dwight Duncan acknowledged "we were wrong" to have initially supported the price freeze, which failed to cover the price that generating companies were receiving for their power.

The new prices should cover the full cost of power, he said. (Duncan has kept a depressing finger on that price, however. Earlier, he announced that most power produced by provincially owned Ontario Power Generation, which produces about 70 per cent of Ontario’s power, will be priced at about 4.5 cents a kilowatt hour.) "We’ve provided a new framework for pricing that will afford a fair, reliable and sustainable supply of electricity," he said.

Prices need to be high enough to attract new investment in generating capacity, Duncan said, adding that "failure to deal with this would have left us in an untenable position."

The best way to head off future price increases is to increase supply and lower consumption through conservation, Duncan said. "We’re doing both."

The two-tier price plan and the installation of smart meters give consumers tools to manage their power bills, Duncan said. Less that 1 per cent of consumers now have smart meters, but that number is expected to grow to 20 per cent in 2007 and 100 per cent in 2010.

Customers with smart meters will have to pay a low rate of 2.9 cents a kilowatt hour in off-peak periods – defined as weekends, holidays and overnight.

But they’ll pay 9.3 cents during the peak periods: weekdays from 11 a.m. to 5 p.m. in summer; 7 to 11 a.m. and 5 to 8 p.m. in winter. Mid-peak rates are 6.4 cents a kilowatt hour.

"What our policy does is allows people through modest changes in consumption to mitigate any increases in their bills," Duncan said.

"Nonsense," retorted Hampton, who said people of modest means have little room to manoeuvre, and no money to pay the higher bills. "What do they do? Unplug their fridge? Turn their electric heat off completely? Or do they skip a meal?"

Keith Stewart of the Low Income Energy Network noted that it will cost consumers $1 billion for new meters, while this year’s budget for local utilities to spend on conservation measures that will be more effective in curbing costs for the poor is at most $225 million.

Martin of Greenpeace agreed that conservation is being neglected. Instead of giving consumers a break in winter by allowing them to use more power at the lowest price, the province should be offering incentives to get people off electric heating altogether, he said.

Duncan said the energy board – but not the provincial government – will launch a public education campaign to explain all the changes. "Over time people will understand this."

With files from Torstar News Service.

The London Free Press
April 1, 2005

Toronto: Flicking on the light switch in Ontario is going to cost more starting today, when electricity rates for residential users rise as much as 10 per cent. Consumers should expect prices to continue going up, said Tom Adams, executive director of Energy Probe.

"That’s quite certain," Adams said. "The only uncertainty is how high will it go."

As of today, residential consumers will pay five cents per kilowatt-hour of electricity – up from 4.7 cents – for the first 750 kilowatt-hours used each month. Beyond that threshold, the cost rises to 5.8 cents per kilowatt-hour – up from 5.3 cents.

Distribution rates, the amount on the bill that goes to local electricity utilities, are also rising.

Combined, the hikes mean bills for residential consumers will go up between four and 10 per cent, the Ontario Energy Board said – despite the Liberals’ promise in the 2003 election to keep electricity prices frozen.