Hydro bills predicted to drop 25% by summer for Alectra Utilities' customers

Residential and small business hydro bills in Hamilton and surrounding areas will drop by 25 per cent on average this summerunder the Liberal government'snew plan to slash soaringhydro rates, says the province's energy minister.

For Alectra Utilities' customers that means they could receive a slightly higher reduction than other cities across Ontario.

The provincial plan will lift billions of dollars in costs offAlectraUtilities' customers, the second largest utility corporation in North America, this year.

This initiativetargetslow income and rural users who could see up to 40 per cent savings on electricty, said Energy Minister Glenn Thibeault during a news conference on Wednesday.

Earlier this month,Wynne's Liberal government touted hydro bills will be cut by 17 per cent, but that figureincludes an eightper cent cut that hasalready happened, a rebate on the provincial portion of the HST that kicked in Jan.1.

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And Alectra Utilities' president MaxCananzipredictsthe provincial hydro plan will lead to slightly lower rates in Hamilton than elsewhere, with residential feesexpected to drop by 2 per cent more than other cities across Ontario.

Small businesses and rural users could see the biggest shift in their hydro bills, Cananzi added, with a reduction as high as20 per cent for businesses and a 32 per cent cut for rural customers.

"The fact that we are equalizing that so the average delivery charge will equal to the average delivery charge in the city of Toronto is going to have a big impact in parts of my rural riding," said Ancaster-Dundas-Flamborough-Westdale MPP Ted McMeekin.

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Delivery charges have been under fire by electricity users for the past year, frustrated by how unaffordable their hydro bills have become even when reducing consumption.

On average, the delivery charge makes up nearly 30 per cent of a typical residential hydro bill,but the amount varies widely from place to place. Different local hydro distribution companiescharge different rates, unlike the cost of electricity generation, which is standard for all residential hydro customers in the province.

"Folks can have a $60 hydro bill and an $800 delivery charge," McMeekinsaid. "That doesn't make any sense."

Thibeault acknowledged the provincial government's failure, admitting Ontario paid too much for renewable energy while overlooking affordability.

"Our system wasn't looked after the way it should," he said.

Thibeault says this initiative will cost the province $2.5 billion over the next three years, once it is passed in the legislature.