The organization representing the province's businesses is issuing a report saying hydro costs are one of the most pressing challenges for Ontario's economy.
The report says industrial electricity prices have
risen 16 per cent since 2013 and are slated to climb 13 per cent higher over
the next five years.
The ministry of energy says Ontario's industrial
electricity rates are competitive with jurisdictions across North America and
the government has introduced several programs to help businesses reduce
electricity costs.
Chamber president and CEO Allan O'Dette says there's
no easy way to bring prices under control, but believes one key step is for the
Liberal government to be more transparent about how costs are calculated.
He says more disclosure about peak and off-peak times
could help all consumers keep their hydro expenses under control.
O'Dette also says the government should reverse its
decision to remove a debt retirement charge from residential bills starting
next year, adding it's unfair to leave businesses shouldering the burden of
discharging debt.
"Year over year, the cost of electricity
continues to rise," O'Dette said in a telephone interview. "Has the
sky fallen? No it hasn't...I think what we're saying here is the majority of
our members are raising electricity prices as a major, major concern."
A spokesman for the ministry of energy touted various
programs that he said are "directly assisting businesses in maximizing the
cost-saving benefits of conservation."
"While we seek to reduce costs through
conservation initiatives and prudent system planning, (Premier) Kathleen Wynne
and the Ontario Liberals have also implemented a wide range of programs to
reduce the cost of electricity for businesses," Dan Moulton wrote in a
statement.
The report, compiled by seeking input from local
chambers of commerce over the past year, lists several recommendations the
government could adopt to keep prices in check.
O'Dette said the thorny policy issues involved made it
difficult to reach a consensus, but the two primary suggestions were widely
agreed upon.
Transparency, O'Dette said, is the most glaring
oversight in the government's current approach to managing the province's
electricity. Business and consumers, he said, are left in the dark as to the
complex rules that dictate how a hydro bill is calculated and are therefore
unable to change their usage patterns to keep the total down.
He also cited the pending partial sale of Hydro One, a
move opposition parties are decrying as a surefire way to send electricity
costs through the roof.
The government has announced plans to sell 60 per cent
of the giant utility that also serves as a local electricity distributor for
1.3 million customers. The Liberals hope the sale will raise $9 billion, $5
billion of which is earmarked for hydro debt.
O'Dette, however, said the facts on the prospective
deal are so scanty that the chamber couldn't even factor it into its report.
"The reality is we really don't know too much
about the Hydro One sale," he said. "What we're calling on is a
little bit more transparency around that."
The report's other key recommendation focuses on the
debt retirement charge, a fee averaging $5.60 a month that has been in place
since 2002 to defray the costs of old nuclear plants.
The government has announced that the charge will come
off residential bills starting Jan. 1, 2016, while businesses will continue to
pay the fee.
O'Dette said the move places an unfair burden on the
province's economy and urged the Liberals to leave the charge in place for all
hydro users until the debt is paid down.
The ministry of energy said it would not be following
the chamber's recommendation on the debt retirement charge.
"The Ontario Chamber of Commerce is recommending
that hardworking Ontario families and seniors pay higher electricity bills, and
this is not something our government will do," Moulton wrote.
The report argues that reduced hydro prices are
necessary to keep businesses competitive, saying several pending government
initiatives will join forces to create a tough economic climate in the
province.
The chamber cites an increase to minimum wage, an
Ontario Retirement Pension Plan in the works, and a review of the Labour
Relations Act as potential drags on the province's businesses.
This post was originally published here:
Ontario Businesses Call On
Province To Curb Steep Electricity Prices
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