Premier Doug Ford Promises to Cut Hydro Rates by 12%

Premier Doug Ford

Making good on his campaign promise to lower expensive energy rates, Premier Doug Ford vowed to cut hydro rates by 12%.  Ford stressed that the province’s hydro rates continue to make it difficult for businesses to compete with their American counterparts.

Ford said, “We have to compete. We have to lower energy costs. I’m just zoned in on this like I’ve never been before.”

According to GlobalNews, the government had budgeted $4 billion for the 2019-2020 fiscal year to keep hydro prices stable.  Electricity prices have been an ongoing problem for Ontario consumers who live or own businesses in the province and who are forced to pay high Global Adjustment rates. The global adjustment was enacted to bridge the gap between the province’s hourly electricity price and the price guaranteed under contracts and regulated rates with power generators.

As one of the most complex issues the government deals with, the high price of electricity has forced many citizens to run washing machines or dishwashers at night in order to cut down on costs.  The same can be said for owners of large businesses, who are operating their plants in the middle of the night or cutting staff to save money.

In speaking with reporters, Premier Doug Ford hinted Ontario could soon see an end to these late-night energy saving techniques.

“People work all day, they work their backs off and then they have to go home and start doing chores at 8 or 9 o’clock at night because of the energy costs. There is one thing we are going to do is look at that,” he explained.

In Ontario, mid-sized and large businesses rely on large amounts of electricity for effective operations; businesses with a peak demand of 50 kilowatts or more pay the wholesale price for electricity.  These consumers are categorized under “Class B” Global Adjustment. They pay a monthly posted Global Adjustment (GA) rate that is calculated by the IESO.

In light of rising hydro costs, operators have been implementing ways to manage their electricity consumption, but some large business owners say the province’s increasing electricity prices are hurting their competitiveness. A conducted study shows Ontario’s high electricity rates has cost the area more than 74,000 manufacturing jobs and just a few years ago, large industrial consumers in Toronto paid nearly three times more than consumers in Montreal and Calgary.

As for when his plan for lowering rates would come out, Premier Doug Ford said hydro consumers should watch for the details in the coming weeks.

About Neel Achary 18722 Articles
Neel Achary is the editor of Business News This Week. He has been covering all the business stories, economy, and corporate stories.