Ontario hydro bills to rise over next 10 years in government's energy plan

In ten years, Ontario's electricity ratepayers can expect to pay an average of $181 a month $54 more than the current provincial average.

The projected rates were released Thursday as part of Ontario's latest long-term energy plan, which forecasts prices until the mid-2030s.

The updated rate predictions are lower across the board compared to the long-term energy plan released by the province in 2013, when Ontario said hydro rates would reach $200 by 2027.

The projected rates are also lower than those contained in a document leaked to CBC Toronto earlier this year.

• How your hydro bill will rise over the next decade

"Our long-term energy plan lays out a path for predictable, affordable electricity prices," said Energy Minister Glenn Thibeault. "It is well-known that our government has taken major steps to remove costs from our electricity system now and in the future."

Part of the savings is being attributed to the Liberal's Fair Hydro Plan, which has promised to cut Hydro rates by 25 per cent this year and hold increases to the rate of inflation over the next four years.

The Liberals says other initiatives, including only securing new power when it's needed and allowing more people to produce green energy in their homes will also help prevent sharp rate increases.

Thibeault says the ministry will also continue to seek out savings in other areas.

"We have shown that we have taken costs out of the system and we know there's more that we can do," he said.

The plan also projects a shortfall in electricity supply starting a little after 2020, when one nuclear generating station reaches the end of its life and others are removed from service for refurbishment.

Government officials say their plan is to close that gap largely through moving away from long-term, 20-year contracts and diversifying the supply mix.

Critics target 'political document'

Opposition parties wasted little time attacking the plan and the methods used to achieve the savings.

"This is all about freezing rates for a short period of time," said Progressive Conservative energy critic Todd Smith just minutes after Thibeault finished his news conference.

"This is billions and billions of dollars on the backs of taxpayers simply as a re-election ploy for Kathleen Wynne."

NDP energy critic Peter Tabuns called the plan a "completely political document."

In a report released last week, Ontario's auditor general Bonnie Lysk found that the Liberals concocted a "needlessly complex" system in order to achieve the savings in the Fair Hydro Plan by moving $26 billion of debt off the government's books.

The money is being "improperly" borrowed Ontario Power Generation, Lysk said, which ratepayers will eventually see on their bills over the next 30 years.

• Auditor general blasts Kathleen Wynne's 'Fair Hydro Plan'

Thibeault said the accounting isn't deceptive, and that similar financing strategies have been used throughout Ontario history, including for the construction of nuclear plants in the 1970s.

"That's the way it's always been done and so what you're seeing right now is the true cost of electricity in this province," he said.

However, some groups are casting aside concerns about political motivations, and say the short-term reduction has already made a difference for people struggling to pay their bills.

"As long as people can keep their hydro connected, I really don't care what colour tie you're wearing today," said Francesca Dobbyn, executive director of the United Way of Bruce-Grey.

Demand to hold steady

The plan also predicts energy demand will hold steady at just under 30,000 megawatts during peak periods from now until 2035, which would represent a stabilization after decades of fluctuating demand.

Critics say that forecast fails to account for the inevitable, and possiblysignificant changes in how electricity is produced and consumed over the next two decades.

"This is a very rosy picture of what's to come,"Tabuns said."I think it's going to be a lot more turbulent."

The Ministry of Energy says the forecast has accounted for future developments: chiefly, the ongoing electrification of transportation systems.

The report assumes 2.4 million electric vehicles will be on Ontario roads by 2035.