Sunday, October 23, 2016

Ontario Keeps Hydro Prices Frozen

A little surprisingly, Ontario has kept electricity prices frozen for the on peak, mid peak and off peak rates for the new period starting November 1st. Ontario sets prices on May 1st and November 1st every year.

This past May prices went up 0.5 cents to 18 cents for on peak, off-peak went up to 8.7 cents. Mid-peak went up to 13.2 cents per kilowatt hour.

2016 was an exceptionally hot summer, so demand was high. Somewhat paradoxically, that's better for rates as Ontario often has a surplus of power and expensive solar and wind have to be paid no matter what the demand is. More solar and wind supply is still slated to come online for some time, so a mild winter with a lot of wind could cause some problems. The rate increase for May 2017 should be interesting.

Also I forgot that the provincial carbon scheme kicks in in January which will also result in some increasing pressure on electricity prices. Since nuclear, hydro, solar and wind isn't really affected, the only real source that will be affected is natural gas which is relatively minor. I haven't seen an estimate of how much higher electricity prices will be.

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