February 24, 2008

Time to put some reality into hydro pricing

Putting some reality into Ontario electricity pricing would be good for public health, the environment and the province’s economic productivity, says a new report from the Ontario Clean Air Alliance.  And by combining a move to full cost electricity pricing with a Hydro Rebate Tax Credit, residential consumers will actually see their hydro bills fall.

Tax Shift: Eliminating Subsidies and Moving to Full Cost Electricity Pricing examines how a low electricity price leads to over-consumption and results in increased greenhouse gas and smog-causing emissions from the electricity sector.  Ontario’s low electricity prices are a result of subsidies that range from low water royalty rates for hydro generators to using the income taxes paid by Ontario Power Generation and Hydro One to pay the interest on the province’s nuclear debt.

The OCAA’s new report recommends that instead of using public dollars to hold down electricity prices – thereby undercutting the incentive to use electricity efficiently – we use this money to provide Ontario residents and farmers with an annual Hydro Tax Credit.  The average residential customer would actually come out well ahead under such a system, while businesses could increase efficiency and self-generation efforts to keep their bills in check.

Right now, Ontario’s electricity productivity is 60% less than that of New York State.  We are paying a big price in terms of public health and the environment, as well as our economy, for this low level of productivity and efficiency.   The public health and environmental impacts of our coal plant emissions alone add up to $3.1 billion a year.  We simply cannot afford to stick with the status quo.

The full report is available at www.cleanairalliance.org .

Please contact Ontario’s Energy Minister, Gerry Phillips, at gphillips.mpp@liberal.ola.org and tell him that we need to move to full cost electricity pricing to create a culture of conservation.



Please pass this message on to your friends.

Thank you

Jessica Fracassi
Communications & Membership Manager
402-625 Church St, Toronto M4Y 2G1
Phone: 416-926-1907 ext. 245
Fax: 416-926-1601
Email: info@cleanair.web.ca
Website: www.cleanairalliance.org