Rural electricity customers wary of Ontario's rate cuts

The 25-per-cent cut "on average" to hydro bills in Ontario will affect customers differently, and long-suffering rural users worry their bills won't fall nearly enough.

"With their history, we know we're going to pay one way or the other. It's pretty obvious"

Rural residents have been frustrated by how affordable their hydro bills have become, especially with the high delivery costs they're charged. (Chris Seto/CBC)

Ontario's premier says she's heard the plight of rural residents and is promising more than a 25-per-cent cut to their soaring power bills, but homeowners in the countryside outside of Ottawa aren't rejoicing.

They say they'll believe it when they see it.

Edith Miller is a resident of the City of Ottawa, but is one of those unhappy residents who is served by Hydro One rather than Hydro Ottawa because she lives in the rural south end.

With their history, we know we're going to pay one way or the other. It's pretty obvious. They're not fooling anyone.- Edith Miller, resident on the rural outskirts of Ottawa

"It's ridiculous!" she says of the $500-$1,000 she pays each winter month for hydro. Miller is a hair stylist and says hydro now takes up more than one of her paycheques each month. 

Even after spending thousands of dollars to convert to a wood furnace and install LED lighting, she says her bills have doubled in recent years.

"It enrages us every time we get a bill. As a matter of fact, I've been so enraged by it that I've started mailing a copy of it to Kathleen Wynne every month," said Miller.

Miller routinely compares bills with neighbours and nearby farmers and says no one can make sense of the charges and increases. She has little faith in either the Ontario government or Hydro One.

"With their history, we know we're going to pay one way or the other. It's pretty obvious. They're not fooling anyone," said Miller.

How your bill will change

On Thursday, the Ontario Liberals announced hydro bills would be reduced by 17 per cent, "on average," by the summer. When one includes the 8 per cent HST rebate implemented Jan. 1, that cut rises to 25 per cent.

But electricity bills are complicated to decipher, and how that average 25-per-cent cut would come through — Hydro One says it could be as high as 31 per cent for some customers — is equally complicated.

Here's where your bill should or could change:

  • Your electricity charge for the power you use: According to Hydro One, the announcement means a 20-per-cent cut to the "global adjustment." That's a fluctuating number hidden within time-of-use pricing on many bills. Some people do get bills where "global adjustment" is on a line of its own.
  • Your delivery charge, if you live in rural areas or on a reserve: Hydro One's "low density" residential customers have been receiving an extra $60 off the delivery line of their bill since Jan. 1. Under Thursday's announcement, anyone who is a "medium density" customer will also start getting that rebate. All told, 750,000 Hydro One customers will now see that extra rebate under the RRRP, or "Rural or Remote Rate Protection" program. Note, cottages tend to fall under a different category, as do business owners. The government says electricity customers living on reserves will pay no delivery charge at all.
  • Extra subsidies: The government says it's increasing the rebate for people on low incomes who take part in the Ontario Electrical Support Program (OESP) by 50 per cent. It's also creating an "affordability fund" to help other people on low incomes improve the energy efficiency of their homes.
  • Your regulatory costs: Even though the government is boosting subsidies to encourage conservation and help people on low incomes or living in rural areas, you shouldn't see this reflected on a line of your hydro bill. In fact, the government plans to move many of these regulatory costs off hydro bills and pay for them out of the general tax base.

Closing the rural-urban gap

The announcement is a great one for Hydro One customers, said Ferio Pugliese, executive vice-president of customer care and corporate affairs.
Hydro One has been telling the government about how customers are concerned about unaffordable bills. (Darren Calabrese/Canadian Press)

"It addresses affordability and relief in areas that we've been hearing about from customers in the past several, several months in our trips and in consultations with them," he said.

People who live in rural areas tend to be harder hit because the policy is to recover costs, Pugliese said. So, where there are few people and many hydro poles, those people pick up more cost than people living in urban areas.

Of its 1.3 million customers, 750,000 residential customers will now get that $60 monthly relief on the delivery line of their bills.

"So, essentially what you're doing is seeing their delivery charges come more in line with urban areas like Ottawa," said Pugliese.

But seeing $60 come off the delivery line of her bill is cold comfort to Miller, because she thinks her overall bill is way higher than it should be.

"It's a laugh. You take $60 off $560 that's a joke," said Miller.