Posted by: Craig Huckerby in Business, Community July 16, 2015 17 Comments
Soaring electricity rates in Ontario are putting a lot of people and businesses in the poor house. The Sault Ste. Marie PUC tell Saultonline.com that an additional 276 late payment notices have been issued this year to customers and a total of 8,683 notices year to date. Giordan Zin, public relations for the PUC points out that in April 2015 the collection process was modified and collection letters are now sent out when a customer is 1 month past-due, rather than 2 months which had been the past practice.
Despite that however, many customers are finding it hard to cope with their ever increasing power bills and that includes business and industry in Ontario.
In a report last week, the Globe &Mail reported that one in 20 Ontario industries are planning on moving out of the province due to sky high electricity prices. 81 per cent of Ontarians are concerned that rising electricity rates will “impact the health of the Ontario economy.” In addition, the same percentage of Ontarians are concerned that the increases will “impact their disposable income, according to a Leger poll.
The Sault Ste. Marie PUC have no control over the rates charged, that falls squarely on the Ontario Energy Board and the Liberal Government. Locally the PUC retains only 18 cents out of every dollar collected from their customers says Zin, the bulk of your bill goes to other provincial agencies who absorb the remaining 82 cents. The PUC controls the distribution and a slight increase in the delivery charges were made in May. For an average monthly bill of 800 kWh, overall charges increased 2.4% or $2.66, excluding any changes to the energy component. The part that PUC keeps to cover its costs to deliver the energy to the customer went down by $0.05 and the part that the Province collects to cover the provincial grid and regulatory charges went up by $2.66. Taxes on the overall increase amounted to $0.34 and the Ontario Clean Energy Benefit provided a rebate of $0.29.
The Sault Ste. Marie PUC says the average power bill for their customers are one of the lowest in the province and it wants to stay that way.
For many customers their power bills are hard to understand with a convoluted, complicated electricity pricing system but what is making Ontarians crazy is the over-abundance of electricity generated in Ontario is being sold cheaper to other jurisdictions. According to the report, energy demand in the province dropped 8 per cent between 2003 and 2014 – but generation capacity has increased by 13 per cent. This means that Ontario has a huge surplus and so it gives away electricity. These costs of producing electricity and then basically exporting it for free are passed on to customers.
Zin says, though they hear it first hand from customers, their anger should be directed to those who make the decisions on electrical rates. The PUC locally, as stated above only have 18 cents per dollar to keep their infrastructure going and making improvements and that’s exactly what they’re doing.
“PUC has been replacing poles, switches, insulators, and wires for many years in an effort to improve ongoing reliability. In particular, 3 years ago the PUC made a commitment to City Council to enact an aggressive and targeted infrastructure revitalization campaign aimed at replacing specific failure-prone switches and insulators.” Zin said.
From 2012-2014 the PUC committed to replacing a total of 1,200 suspected defective switches and 3,000 failure-prone porcelain insulators.
Project Results
1,375 – Switches Replaced
3,302 – Porcelain Insulators Replaced
This targeted infrastructure renewal project resulted in an overall improvement in switch and insulator reliability. Since 2010/2011 there has been a:
76% Reduction in Frequency of Outages
75% Reduction in Duration of Outages
As good as that might sound, customers are fed up with the cost of power in Ontario. One customer, who did not want to be identified complains that her power bills are almost the same as her mortgage payment. “That isn’t right, when your utility bill is on par with your mortgage and car payments, it’s getting harder and harder to survive in this Province”
The Sault Ste. Marie Chamber of Commerce is equally concerned about power rates, yesterday it issued a release along-side the Ontario Chamber of Commerce painting a grave picture for the economy. “Summer is heating up and so is the price of electricity,” said Monica Dale, President of the Sault Ste. Marie Chamber of Commerce. “The price of electricity in Ontario is set to rise over the next two decades, adding to the cost of doing business in the province. If something is not done now to mitigate these increases, businesses will leave the province, jobs will be lost, and our economy will suffer.”
Dale adds that the issue of electricity rates is a vitally important issue to the Sault Ste. Marie economy and to many Chamber member businesses. She notes that “several of our key industries are from the manufacturing sector, where electricity accounts for a huge portion of the production process and as such, represents proportionately large production cost.