Ontario Power Prices Have Fallen!

On August 26, 2016 I posted this blog Ontario Power Prices Are Too High!  in which I pointed out that "Prices are out of control and many folks are feeling the pain."Someone was listening and that is why this post is long overdue.

Of course it wasn't just my concern .In fact according to a Nanos Research poll sited in the Globe and Mail article "Why does Ontario's electricity cost so much? A reality check" hydro rates were the number one issue of concern for Ontario residents back in November 2016. No wonder the Liberal government had to do something.



The government was well aware of the public's negative opinion on rising power costs and began working on solutions. On September 27, 2016 the government issued a press release Actions to Reduce Energy Costs highlighting a number of initiatives to reduce rates and costs. The debt retirement charge had already been dropped for residential customers on January 1st 2016 and legislation was passed to provide the equivalent of an 8% rebate to consumers, equivalent to the HST, starting January 1, 2017.

Then on March 31, 2017 the Ontario government issued another press release highlighting Ontario's Fair Hydro Plan .The legislation enacted would immediately cut hydro rates on average by 25% through a number of initiatives. That was all welcome news but I needed to see whether or not the government actions would actually lower my bills.

Price

 As I previously noted in my original blog Ontario Power Prices Are Too High! I take the dollar cost of each of my semi-monthly bills and divide by the consumption to arrive at my effective cost of power. My starting point is the August bill from the previous year through to the June bill of the current year. [That effectively means for 2017 I am using billing information from June 14 2016 through June 13 2017 and the 2018 information is for 10 months].

Chart 1: Power Prices are Declining

  Chart 1 clear shows the uptrend in my average power cost per kWh has abated and my cost has declined. Based on the chart my unit cost of power is now lower than in 2014.

Consumption & Cost

 As previously pointed out we have been diligent in reducing our consumption through a variety of means so as to not get hurt too badly when power rates were going up. That trend has continued into 2018 and our family will set a new record low for power consumption.

Chart 2: Our Annual Cost of Electricity has Fallen

 Now that rates have fallen we are finally reaping our reward of significantly lower electricity costs.  In 2018 we will pay less than 60% of our peak cost in 2011.

Mike Says...

Since 2003 power rates have risen by about 3% pa due to the actions of the Ontario government while we have decreased our power consumption by almost 50% leaving us with the lowest cost of electricity since we moved into our home in 1994. Interestingly enough our power cost is now less than what we pay for water and waste water in Mississauga - a topic for another day.

If not for the pain of higher prices I am not sure we would have been as diligent in reducing our consumption. The vast majority of our actions have not resulted in a decline in our standard of living but have centered on reducing inefficiencies and wasted power. 

Included in our consumption numbers is the power used to charge our plug-in hybrid that was leased back in December 2016. While we don't drive a lot we nevertheless use about 50 kWh monthly to charge our car.

We are most appreciative of the actions of the Ontario government to rein in power costs - we can confirm that we got our 25% reduction as advertised.