Premier Kathleen Wynne made an announcement today that will give Ontario households a 25% cut on their hydro bills.
“If you’re paying electricity prices in Ontario, you will save 25% and no price increase for 4 years” the Premier announced Thursday morning.
The Province will go even further for those in rural areas or for the low income families.
The Premier said the rate decrease will hold for the next four years and rates will only increase with inflation, about 2%.
“It means if you’re paying $235 a month today, it will reduce your bill to about $101” Wynne said.
The Premier admitted the funding of the Hydro situation was a mistake. “were refinancing the mortgage” The burden of the hydro costs will be made more fair and even.
The Premier has been forced to tackle rising hydro bills across the province and the issue has dodged the Liberal government for over two years.
The reduction means adding $2.6 billion to Ontario’s debt but Wynne said her government is on target to balance the budget by 2018.
The Province released this announcement Thursday morning:
System Restructuring Delivers Lasting Relief to Households Across Province
Ontario is lowering electricity bills by 25 per cent on average for all residential customers as part of a significant system restructuring that will address long-standing policy challenges and ensure greater fairness.
Starting this summer, Ontario’s Fair Hydro Plan would provide households with this 25 per cent break. Many small businesses and farms would also benefit from the initiative. People with low incomes and those living in eligible rural communities would receive even greater reductions to their electricity bills. As part of this plan, rate increases over the next four years would be held to the rate of inflation for everyone.
These measures include the eight per cent rebate introduced in January and build on previously announced initiatives to deliver broad-based rate relief on all electricity bills.
Taken together, these changes will deliver the single-largest reduction to electricity rates in Ontario’s history.
Recently, electricity rates have risen for two key reasons:
The burden of financing these system improvements and funding key programs has unfairly fallen almost entirely on the shoulders of today’s ratepayers. To relieve that burden and share costs more fairly, two system fixes are being undertaken.
Recognizing that the electricity infrastructure that has been built will last for many decades to come, the province would refinance those capital investments to ensure that system costs are more equitably distributed over time. In addition, a number of important programs, such as the Ontario Electricity Support Program (OESP), will now be funded by the government instead of by ratepayers.
The province will also launch a new Affordability Fund, enhance the existing OESP and Rural or Remote Rate Protection (RRRP) program and provide on-reserve First Nations households with a delivery credit. These new measures will cost the government up to $2.5 billion over the next three years.
Notwithstanding that hydro rate relief costs will add significant pressure on the fiscal framework, the province continues to project a balanced budget for 2017-18, and will provide a full update on its fiscal plan in the spring budget.
Reducing electricity costs is part of Ontario’s plan to create jobs, grow our economy and help people in their everyday lives.