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Hydro rate hike approved to cover fines, court costs

Ontario hydro customers can expect yet another rate hike – this time to cover $18 million in fines and court costs utilities will have to pay.

The Supreme Court of Canada ordered most of the province’s electricity providers to repay millions in late fees that exceeded the 60 per cent allowed by law.

The illegal amount charged on overdue accounts was $17 million. Interest and other costs incurred to settle the lawsuit added another $1.4 million.

Since it would be impossible to track down the customers who had been overcharged, the utilities agreed instead to pay into a fund to help low-income families with their winter heating bills.

The companies then appealed to the Ontario Energy Board for approval to raise their rates, arguing delinquent accounts cost them dearly. The OEB ruled in their favour.

On average, ratepayers will see 20 to 30 cents more each month on their bills, over the next one or two years. The increase does not apply to Hydro One’s local customers.

The OEB is also expected to rule on a request from Ontario Power Generation for a 6.2 per cent increase in electricity rates starting March 1st. It would add about $1.86 to a typical homeowner’s monthly hydro bill.

The New Democrats say, if approved, the levy will enrich the Liberal government at the expense of families struggling to pay their bills.    

“The government coffers are definitely going to be expanded with energy prices going up because they’ll be pulling in the HST on all of that,” said NDP Leader Andrea Horwath.

Premier Dalton McGuinty says rising costs are the upshot of updating the province’s infrastructure.

“I think what people want me to do is what I honestly feel is the right thing to do,” McGuinty said. “Sometimes doing the right thing is not easy. Maybe if the opposition had some easy answers to offer … Apparently we can renovate our electricity system and our bills won’t go up at all.”

The Liberals have offset rising hydro rates with the Ontario Clean Energy Benefit – a 10 per cent rebate over five years that went into effect Jan. 1st.