by SUSAN MANN
Starting next year farmers and other customers will see a 10 per cent reduction in their electricity bills as part of a provincial government initiative to help consumers manage rising electricity prices.
Ontario Finance Minister Dwight Duncan made the announcement in the provincial Legislature Thursday afternoon as part of his fall economic statement. The benefit takes effect Jan. 1 and would amount to a 10 per cent reduction in electricity bills every month.
But critics of the plan say the temporary benefit won’t help customers cope with skyrocketing hydro bills that are expected to increase by 46 per cent over the next five years. More than half of the rising electricity costs are due to new clean energy, such as wind, solar and water.
More than 400,000 small businesses, farms and other small users plus four million residential customers will get the reduction for the next five years as part of the Ontario Clean Energy Benefit. “This would help families, it would help hard working small business owners and it would make a difference for Ontario’s farms,” Duncan says.
The Clean Energy Benefit will cost taxpayers $1.1 billion over the course of a full year, it says in the economic statement.
Bette Jean Crews, president of the Ontario Federation of Agriculture, says the electricity bill reduction is “good news.”
Ontario Agriculture Minister Carol Mitchell says “we can be very proud of our energy system. Moving towards a reliable, affordable and clean energy system certainly provides our agricultural community with opportunities.”
Investing in the transmission and electrical system is an important component to moving Ontario and farmers forward, she adds.
Nathan Stevens, research and policy adviser with the Christian Farmers Federation of Ontario says the benefit will help buy some time for farmers to adapt in the long run to a higher energy cost environment. “There are a lot of farmers facing tighter and tighter margins all the time and energy is one of the big components of that.”
Sean McGivern, Ontario coordinator for the National Farmers Union, says the rebate does nothing to address the impact of time-of-use billing on farms. Farmers can’t change the time they do milking or turn on the silo, chores that may have to happen at the more expensive peak energy time periods, he points out. “It’s kind of like they’ve taken away the big bone and thrown us a biscuit.”
Time-of-use billing will charge different rates depending on the time of day.
In the statement, Duncan notes Ontario is emerging from the global recession. Since May, 2009 more than 180,000 new jobs have been created. Ontario has recovered 75 per cent of the jobs lost in the recession.
Ontario’s real gross domestic product (GDP) growth is projected to be 3.2 per cent in 2010; 2.2 per cent in 2011; and 2.5 per cent in 2012.
The projected deficit for 2010-11 has been cut by almost 25 per cent compared to previous forecasts. The government projects the 2010-11 deficit to be $18.7 billion and credits strong economic growth and responsible management for the decline.
Total provincial expenses in 2010-11 are projected at $125.6 billion, which is 0.2 per cent lower than the 2010 budget forecast. Revenue for 2010-11 is projected at $107.7 billion, which is almost $800 million more than the 2010 budget forecast due to stronger economic growth. BF