TORONTO — An Ontario government plan to reduce soaring electricity rates by 17 per cent this summer will ultimately cost ratepayers up to $1.4 billion a year in extra interest payments.
Those extra costs will come due for ratepayers in the future, the Liberal government acknowledged Thursday.
"Over time it will cost a bit more. That's true. And it will take longer to pay off...but it is fairer," Premier Kathleen Wynne said Thursday as she detailed her plan.
Ontario Premier Kathleen Wynne speaks during a press conference in Toronto on March 2, 2017. (Photo: Frank Gunn/CP)
The Liberal government faces no bigger political issue at the moment than hydro bills, which have nearly doubled in the last decade.
The across-the-board relief announced Thursday, which comes in addition to an eight-per-cent rebate that took effect Jan. 1, is being achieved by refinancing already long-term power generation contracts over even longer terms.
Wynne noted that the new plan is fairer because current ratepayers don't have to shoulder the entire burden of huge system costs.
"The people and families I've spoken with in recent months have made it clear: this must be our top priority. The burden of high hydro rates has become too great. We have to bring them down."
"The people and families I've spoken with in recent months have made it clear: this must be our top priority."
Several other measures were announced Thursday to help low-income, rural and northern residents, including the removal of the delivery charge for on-reserve First Nations residential customers and the reduction of distribution costs for some rural ratepayers.
Those measures will cost the government $2.5 billion over three years.