subscribe

-- More than a million people who have signed contracts to buy electricity at a fixed price may actually have to pay more than they bargained for due to a quirk of Ontario's deregulated power market.

That's because the cost for often exorbitantly priced imported power the province needs in times of high demand is a floating rate charged separately from domestically produced power.

"You can get a very mistaken impression of what you're paying for power during those periods when we are importing," said Tom Adams of Energy Probe.

"It is right now impossible for consumers to see what price they're actually paying for the juice."

Ontario is highly dependent on its neighbours during peak periods - such as occurred during recent heat waves.

At those times, the province routinely went outside its borders for about 10 per cent of its daily power, a substantial amount.

That power routinely ranges between $1 and $2 a kilowatt-hour, 25 to 50 times the usual going price.

On a customer's bill, the extra cost for imported power is rolled into a range of charges known as "uplift" charges.

Consumers now pay a fixed 0.62 cents a kilowatt-hour for those charges based on a projected estimate of what the various costs will be over a year.

However, that price was set before the decision was made to separate the costs of imported and domestic power and the actual uplift will only be known at the end of the year.

Although, theoretically, the uplift cost might end up being lower than expected, Charlie Macaluso of the Electricity Distributors Association said people on fixed-price contracts could well be in for shock.

"There are significantly high uplift charges that are accumulating that are probably beyond what many may have expected," said Macaluso.

"Those people who are on a fixed-rate contract will potentially see a significant increase in their bill . . . because the import charges were not protected with that fixed rate."

The Independent Electricity Marketing Operator - or IMO - the provincial agency that manages the amount of power flowing through the province, said it's monitoring the uplift costs.

"So far, they're tracking to be within that 0.62," said spokesman Ted Gruetzner.

"But it was always understood that it was a flexible cost."

It's impossible to know what the imported power component of the uplift charge is at any given moment because of the time lag in calculating the final price.

However, to address criticism about a lack of transparency, the IMO on Thursday began listing an estimate on its Web site.

Bob Hunt of the Ontario Energy Marketers Association said marketing companies are concerned about a potential customer backlash.

"They recognize that they will be asked about additional charges and unfortunately it's not something that's within (their) control," said Hunt, adding that many large industrial users are also unhappy with the pricing system.

Related News

iaea-warns-of-nuclear-risks-from-russian-attacks-on-ukraine-power-grids

IAEA Warns of Nuclear Risks from Russian Attacks on Ukraine Power Grids

KYIV - In early February 2025, Rafael Grossi, Director General of the International Atomic Energy Agency (IAEA), expressed grave concerns regarding the safety of Ukraine's nuclear facilities amid ongoing Russian attacks on the country's power grids. Grossi's warnings highlight the escalating risks to nuclear safety and the potential for catastrophic accidents.

The Threat to Nuclear Safety

Ukraine's nuclear infrastructure, including the Zaporizhzhia Nuclear Power Plant—the largest in Europe—relies heavily on a stable power supply to maintain critical cooling systems and other safety measures. Russian military operations targeting Ukraine's energy infrastructure have led to power outages, jeopardizing the safe operation of…

READ MORE
elon musk

Elon Musk could help rebuild Puerto Rico with solar-powered electricity grid

READ MORE

washington-state-ferries-hybrid-electric-upgrade

Washington State Ferries' Hybrid-Electric Upgrade

READ MORE

power lines

Electricity prices rise more than double EU average in first half of 2021

READ MORE

tidal power

Canada Makes Historic Investments in Tidal Energy in Nova Scotia

READ MORE