Paul Kahnert

May 15, 2014 15:13 ET

Time for a leaders' debate on why your hydro bill is so high

TORONTO, ONTARIO--(Marketwired - May 15, 2014) - Hydro bills are skyrocketing, with no end in sight. Businesses like Magna are refusing to locate plants here because of high hydro rates. Other companies have already left or are planning to leave Ontario.

People and businesses in Ontario pay twice as much for electricity as people in Quebec or Manitoba, and it's time we had a leaders' debate on the real issues behind high hydro rates - rates the Association of Major Power Consumers of Ontario complained in February were "the highest electricity rates in North America."

The real reasons for high hydro rates are deregulation and privatization.

Tim Hudak has amnesia about his record with the PC Party in Ontario, which brought in the deregulation legislation that is behind our skyrocketing hydro rates. Hudak voted for that legislation. The Conservatives had a massive advertising campaign promising that deregulation would "lead to lower rates."

Tory deregulation had two effects. First, it changed all Ontario's provincial and municipal Hydro from non-profit commissions into for-profit corporations. The Tories were repeatedly asked, "How do you get lower rates when you add in profits to generators, profits to distributors, profits to retailers, dividends to investors and commissions to commodities brokers?" They never gave an answer.

The second thing the Tories did was create a deregulated electricity market. It's important to note that Enron was the main player on the electricity market design committee. That's right, Enron, the company that committed some of the biggest frauds in U.S. history. The Independent Energy Electricity System Operator (IESO) market rate during this year's March cold snap was almost 25 cents per kilowatt hour. The pre-deregulation rate was 4.3 cents/ Kwh. Manitoba and Quebec, which have much lower electricity rates than Ontario, don't have deregulated electricity markets. Their rates are regulated as Ontario's once was.

Increased efficiencies, rate freezes and rate rebates aren't going to solve the problem of skyrocketing private power rates. All three parties have dropped the ball on hydro. They are all refusing to talk about hydro deregulation and are protecting the phoney electricity market.

It's time for an honest politician to say, "Hydro privatization and the deregulated electricity market haven't worked." In fact, there isn't one jurisdiction in the world where deregulated electricity markets have worked.

It's long past time to close the electricity market and regulate rates. The fact is that good jobs, a growing economy and full employment in Ontario have always been directly linked to at-cost, non-profit, public power rates.

Contact Information

  • Paul Kahnert, former spokesperson
    Ontario Electricity Coalition and retired hydro worker