Con­ser­va­tives claim se­cret Lib­eral re­port pre­dicts monthly bills in On­tario will hit $215 in 10 years

Con­ser­va­tives claim se­cret Lib­eral re­port pre­dicts monthly bill to hit $215 in a decade

The Hamilton Spectator - - FRONT PAGE - ROB FER­GU­SON Toronto Star

The short-term gain of a 25 per cent hy­dro rate cut this sum­mer could lead to long-term pain as a leaked cabi­net doc­u­ment fore­casts prices jump­ing again in five years.

In the brief­ing ob­tained by the Pro­gres­sive Con­ser­va­tives, rates will start ris­ing 6.5 per cent a year in 2022 and top out at 10.5 per cent in 2028, when av­er­age monthly bills hit $215.

That would be up from $123 this year once the rate cut — the sub­ject of long-awaited leg­is­la­tion un­veiled Thurs­day by En­ergy Min­is­ter Glenn Thibeault — takes full ef­fect. There will be a fur­ther 17 per cent cut — in ad­di­tion to the 8 per cent taken off bills in Jan­uary when the pro­vin­cial por­tion of the HST was waived.

The leaked pa­pers over­shad­owed Thibeault’s ef­forts to tout the price break, which will be fol­lowed with four years of hy­dro rate in­creases at two per cent, roughly the rate of in­fla­tion.

Thibeault charged the Con­ser­va­tives used an “out­dated” doc­u­ment to dis­tract from the fact they are the only ma­jor party with­out a plan for deal­ing with sky­rock­et­ing hy­dro rates with a year to go un­til next June’s pro­vin­cial elec­tion.

“It’s not a co­in­ci­dence,” he told re­porters, deny­ing any plans for an even­tual 10.5 per cent rate hike and promis­ing the gov­ern­ment’s new long-term en­ergy plan, due in a few months, will have bet­ter num­bers.

Op­po­si­tion par­ties said the Lib­eral plan doesn’t deal with the un­der­ly­ing prob­lems that made hy­dro ex­pen­sive and sim­ply bor­rows money to spread the costs over a longer pe­riod with $25 bil­lion in in­ter­est charges over 30 years.

“The price of elec­tric­ity is go­ing to sky­rocket af­ter the next elec­tion,” warned MPP Todd Smith.

“The gov­ern­ment isn’t be­ing hon­est with the peo­ple of On­tario when it comes to the price of elec­tric­ity.”

The doc­u­ments show av­er­age monthly bills peak­ing at $231 in the year 2047, be­fore fall­ing back to $210 the fol­low­ing year, once the 30 years of in­ter­est pay­ments are over.

Con­ser­va­tive sources say they ob­tained the pa­pers stamped “con­fi­den­tial cabi­net doc­u­ment” from a whistle­blower af­ter Thibeault’s rate cut plan was pre­sented to cabi­net min­is­ters at a meet­ing in March.

There is no date on the doc­u­ment that the en­ergy min­is­ter al­ter­nately dis­missed as “in­ac­cu­rate” or pos­si­bly one of many pre­pared with dif­fer­ent op­tions in mind.

New Democrats, who pro­posed a scheme to cut hy­dro rates 17 to 30 per cent if elected, also called the gov­ern­ment plan an elec­tion ploy with Lib­er­als lag­ging in the polls.

Thibeault ad­mit­ted the Lib­eral plan will start re­pay­ing bor­rowed money in the mid- or late 2020s and will show up separately on hy­dro bills as the “Clean En­ergy Ad­just­ment.”

He com­pared the bor­row­ing plan, which spreads costs of up­grad­ing the elec­tric­ity sys­tem by clos­ing coal-fired plans and us­ing more clean sources of power over a longer pe­riod, with a home­owner ex­tend­ing a mort­gage.

Aside from set­ting up an en­tity to do the bor­row­ing, the leg­is­la­tion ex­pands rate sub­si­dies for re­mote ru­ral res­i­dents and low-in­come fam­i­lies and shifts their costs to the broader tax base, in­stead of leav­ing them for ratepay­ers to cover as is the case now.

Smith, his party’s en­ergy critic, said the Clean En­ergy Ad­just­ment is akin to the re­cently axed debt re­tire­ment charge from the old On­tario Hy­dro, but “on steroids” and in place un­til the year 2047, ac­cord­ing to the leaked doc­u­ments.

“The debt re­tire­ment charge was $4 or $5 on the av­er­age res­i­den­tial bill. This one is go­ing to reach $21 by the year 2028. … That’s a huge hit,” he added.

DAR­REN CAL­ABRESE, THE CANA­DIAN PRESS FILE PHOTO

In a brief­ing ob­tained by the Pro­gres­sive Con­ser­va­tives, rates will start ris­ing 6.5 per cent a year in 2022 and top out at 10.5 per cent in 2028, when av­er­age monthly bill hit $215.

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