Hydro price increases in Toronto more than double the national average, study finds

New report highlights steep costs of electricity A new report highlights the steep costs of electricty in the province. Paul Bliss reports.

Between 2010 and 2016, electricity price increases in Toronto were more than double the national average, according to a new study released on Thursday.

The research, conducted by conservative think-tank the Fraser Institute, used data collected by Statistics Canada to examine how the price of electricity has increased across the country and found that from 2008 to 2016, electricity prices rose 71 per cent in Ontario, a number which is more than double the national average increase of 34 per cent.

According to the study, monthly electricity bills in major Canadian cities increased by an average of $37.68 between 2010 and 2016. During the same time span, the average bill in Toronto increased by $77.09 and in Ottawa by $66.96.

In 2016, the study says the average monthly electricity bill for residential customers in Toronto was $201 and $183 in Ottawa, compared to an average of $141 for residents in major Canadian cities.

Montreal residents, who saw the lowest monthly electricity bills of all major Canadian cities, paid $83 per month on average.

In Calgary and Edmonton, the average monthly bill rang in at $109 and in Vancouver, customers paid an average of $114.

Between 2015 and 2016, the study says Ontario experienced a 15 per cent increase in electricity prices.

"To put it into context you have to compare it to the costs of other goods and services. The power prices in Toronto have risen… 2.5 times faster than disposable income in Canada, four times faster than the inflation rate, 4.5 times faster than the growth of the economy," Kenneth Green, a co-author of the study and the Fraser Institute’s senior director of energy and natural resource studies, told CP24 Thursday.

"So clearly it is out of step with the secular trends that you could otherwise look to as an explanation and it has to do with provincial policy."

Earlier this year, the Ontario government reduced residential hydro bills by 25 per cent, with an eight per cent rebate that came into effect on January 1, 2017 and a further 17 per cent reduction in May with the introduction of the Fair Hydro Act.

While this decision will lower rates for consumers over the next 10 years, to help pay back the money borrowed to reduce rates now, ratepayers will see a new “Clean Energy Adjustment” charge on their bills in the mid-to-late 2020s.

“The Ontario government’s plan to reduce electricity costs in the short term is essentially borrowing from future ratepayers to subsidize current bills,” the study read. “Thus, the overall effect of the government’s policy decisions will be to further increase electricity rates in the long term, not reduce them.”

In a written statement sent to CP24 Thursday, Tori Gas, a Toronto Hydro spokesperson, said the average bill for a Toronto Hydro customer is not in fact $201 per month. She said prior to July 1 of this year, the average monthly cost was about $143 for Toronto Hydro customers.

"The report bases costs on an average consumption of 1000kW/month which is really high, as our average customer uses 650kW/month," the statement read.

"Toronto Hydro rates are not the highest in the country. In Ontario, Hydro One and a few other small utilities (Algoma Power, Atikokan Hydro) are higher."

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