Ontario consumers can expect to see increases in their electricity bills, starting next year.
On March 26th, Ontario’s Minister of Energy, Bob Chiarelli, announced coming changes to residential electricity bills. As of January 1, 2016, both the Debt Retirement Charge and the Ontario Clean Energy Benefit will be removed from customer bills. At the same time, the Ontario Energy Board will introduce the Ontario Electricity Support Program, which will provide a monthly credit to low-income consumers. Details about the implementation of the Ontario Electricity Support Program (which is referred to as a “proposed program”) have not been provided, though the range of the benefit is said to be between $20 and $50 per month for qualifying families.
The Ontario Electricity Support Program will be available to individuals and families who qualify under the Statistics Canada Low-Income Measure. For example, a family of four with a household income of up to $39,000 would qualify for credits under the Program. Eligible low-income consumers will have to formally apply through a central service provider and demonstrate that they meet Program thresholds. Low-income consumers will be able to qualify, regardless of whether they receive their service from a distributor, unit sub-metering provider or an electricity retailer.
The unstated message from the Minister’s announcement is that electricity bills will be going up, especially for those consumers who do not qualify for the Ontario Electricity Support Program. Although the Debt Retirement Charge (said to be around $5.60 per month) is being removed from customer bills, the larger Ontario Clean Energy Benefit (which is essentially a 10% discount on all bills) will also disappear. Further, the Ontario Electricity Support Program will be funded by all ratepayers through surcharges on the bills. The Ministry of Energy states that the typical residential customer will pay a charge of less than one dollar per month to fund the Ontario Electricity Support Program. The net result of these changes will be higher electricity bills for residential consumers.