July 8, 2015 — A new report from the Ontario Chamber of Commerce (OCC), in partnership with the Greater Oshawa Chamber of Commerce (GOCC), and over forty Chambers through out the province are calling on the Government of Ontario to tackle the impact of rising electricity costs on the business community.
The report, Empowering Ontario: Constraining Costs and Staying Competitive in the Electricity Market, is the most widely consulted report in the history of the province-wide network. It makes five recommendations that government and energy agencies must take to curb rising costs and keep businesses in the province.
These recommendations are the product of a year-long research and consultative process with over 100 businesses, energy experts, and government agencies. OCC survey results show that 1 in 20 businesses in the province expect to close their doors in the next five years due to rising electricity prices. Almost 38 percent will see their bottom line shrink, with the cost of electricity delaying or cancelling investment in the years to come.
The report is accompanied by public opinion research from Leger, which cautions that soaring electricity prices have reached a crisis point for Ontario businesses and consumers. The research finds that 81 percent of Ontarians are concerned that rising electricity prices will impact the health of the Ontario economy and the same percentage fear that rising electricity prices will impact their disposable income. These numbers rise to over 90 percent in northern Ontario.
“Summer is heating up and so is the price of electricity,” said Jeff Hayes, President of the Greater Oshawa 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.”
Among the report’s recommendations is to keep the Debt Retirement Charge (DRC) on residential bills until it has been retired, spreading the burden of past government decisions across ratepayers.
The Chamber also recommends that government improve the transparency of electricity pricing and system cost drivers. By publishing average electricity rates and disclosing the costs of important investments, government will be held accountable for future decision-making. The lack of transparency in the system has led to reduced customer engagement and confidence in the electricity market. Currently, less than half of Ontarians understand the drivers that contribute to rising electricity bills.
“The Ontario Chamber Network of 60,000 businesses consistently hears that the price of electricity is undermining their members’ capacity to grow, hire new workers, and attract investment,” said Allan O’Dette, President and CEO of the Ontario Chamber of Commerce. “The Government of Ontario has before them a number of decisions that must be made in order to bend the trajectory of soaring electricity costs. A first step will be to increase the transparency of decision-making in the system so that there is clear accountability and confidence in the electricity market.”
The report also examines options that government should not take, such as importing hydroelectric power from Québec to replace nuclear generation and cancelling feed-in tariff (FIT) contracts.