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  • Ontario Energy Rates See Upward Jolt In May

ontario-energy-rates-increaseOn April 16th, regulators and homeowners either breathed a sigh of relief, or held their breath anxiously as Ontario’s energy regulators approved a controversial rate hike for electricity province-wide effective May 1st. For some, this hike helps justify the locked in rates they had signed up for in the past through energy marketing companies. For others, this may be a sign that they need to tighten their energy belts, so to speak.

The hike seems modest enough, a 0.6 cent increase in peak kilowatt hours. The total hike is estimated to cost Ontario homeowners roughly $2.83 per month on their energy bill. While a small increase, another rate hike is scheduled for early November of this year, placing fears in home and business owners that the era of cheap electricity is coming to an end.

This situation closely mirrors the Enbridge gas rate hike put into force earlier this month, as a gas hike was projected to create a ripple effect in Ontario’s energy industry and raise prices across the board. The Ontario Energy Board has come under fire for this decision amid increasing concerns by Ontario residents that utility costs will soon spiral out of control. And in many ways, these concerns are well-founded.

Prior to the 2013 Ice Storm, Enbridge declared that their reserves of natural gas were sufficient to meet continuing need through the coming year, only to recant this declaration with a confession that gas stores were far too low. This kicked off talks of a 40% rate hike on natural gas which were approved on an interim basis in March.

It seems like electricity costs are headed in the same direction, as the growing strain on the energy grid has twisted the Ontario Energy Board’s arm on the matter. And there’s fears that Ontario’s energy industry, once considered a shining example of productivity and value, will go the way of Nova Scotia, which currently pays more for energy and utilities than any other Canadian province.

Adding to the controversy is provincial politics, which are engaged in bitter debate over Ontario’s status as an energy-surplus province. Much of Ontario’s produced energy is being sold to the United States, Quebec, and Manitoba at low prices, leading some to claim that Ontario’s energy costs are unnecessarily high. It’s clear that Ontario’s energy woes will be a central issue of a potential election.

Where does this leave homeowners and consumers? There’s really nothing we can do to influence provincial energy policy aside from our role as citizens. Ontario Energy Group Consumer Watch would like to remind homeowners that there still are steps they can take as consumers to lessen the energy they do use, and to upgrade outdated appliances or utilities that consume excessive energy. While it won’t immediately show a drop in electricity rates, it can blunt the effects of rate hikes that are poised to be rolled out in the future.

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