Commentary

July 31, 2017

Electricity bills in Toronto remain high compared to U.S. cities

EST. READ TIME 2 MIN.

A recent Fraser Institute study found average residential electricity prices in Ontario have skyrocketed since 2008. In particular, growth in electricity prices increased by 71 per cent from 2008 to 2016, far outpacing electricity price growth in other provinces. As a result, Torontonians pay the highest electricity bills nationwide.

But how do bills in Toronto compare to those south of the border?

Hydro Quebec data shows residents in Toronto pay US$142.46 per month for electricity (excluding taxes). In comparison, a study of 100 U.S. cities reveals Americans, on average, pay $134.58 (all dollar amounts in U.S. dollars) for monthly electricity bills. This means that average monthly electricity bills in Toronto are $7.87 higher than the average American price. More specifically, Toronto ranks 29th out of 100 U.S. cities in having the highest electricity prices.

The study’s worst performer is San Diego, California where residents pay $324.18 per month for electricity, whereas residents in Tacoma, Washington have the cheapest bills at $84.65 per month.

The data shows Torontonians pay higher electricity bills than Americans in Minneapolis, Baltimore, Columbus, Chicago, Tennessee, Indianapolis, Richmond, Louisville and more. And pay $21.93 more than their neighbours in Buffalo, New York.

Which raises the question—what caused such high electricity prices in Ontario?

The answer is that misguided policy decisions by the Ontario government. In particular, policies on renewable energy (wind, solar and biomass) have resulted in high additional costs for consumers. Other policy decisions such as poorly structured long-term contracts, the phase-out of coal energy and the contributions of green energy sources to the growing supply and demand imbalance in the province also contributed to electricity price increases.

It’s time the Ontario government pursue meaningful policy reforms aimed at lowering electricity bills for current and future ratepayers.

Kenneth P. Green

Senior Fellow, Fraser Institute

Kenneth P. Green is a Fraser Institute senior fellow and author of over 800 essays and articles on public policy,
published by think tanks, major newspapers, and technical and trade journals in North America. Mr. Green holds a doctoral degree in environmental science and engineering from UCLA, a master’s degree in molecular genetics from San Diego State University, and a bachelors degree in general biology from UCLA.Mr. Green’s policy analysis has centered on evaluating the pros and cons of government management of environmental, health, and safety risk. More often than not, his research has shown that governments are poor managers of risk, promulgating policies that often do more harm than good both socially and individually, are wasteful of limited regulatory resources, often benefit special interests (in government and industry) at the expense of the general public, and are almost universally violative of individual rights and personal autonomy. Mr. Green has also focused on government’s misuse of probabilistic risk models in the defining and regulating of EHS risks, ranging from air pollution to chemical exposure, to climate change, and most recently, to biological threats such as COVID-19.Mr. Green's longer publications include two supplementary text books on environmental science issues, numerous studies of environment, health, and safety policies and regulations across North America, as well as a broad range of derivative articles and opinion columns. Mr. Green has appeared frequently in major media and has testified before legislative bodies in both the United States and Canada.
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Ashley Stedman

Ashley Stedman is a former senior policy analys in the Centre for Natural Resource Studies. She holds a B.A. (Honours) from
Carleton University and a Master of Public Policy from the University of Calgary. Ms. Stedman is the co-author of a number of Fraser Institute studies, including the annual Global Petroleum Survey and Survey of Mining Companies. Ms. Stedman’s research has been covered by various prominent media outlets including the Wall Street Journal and her commentaries have appeared in major Canadian and American newspapers such as the Globe and Mail, Washington Times, National Post, and Financial Post.
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Elmira Aliakbari

Director, Natural Resource Studies, Fraser Institute

Elmira Aliakbari is Director of the Centre for Natural Resource Studies at the Fraser Institute. She received a Ph.D. in Economics
from the University of Guelph, and M.A. and B.S. degrees in Economics, both from the University of Tehran in Iran. She has studied public policy involving energy and the environment for nearly eight years. Prior to joining the Fraser Institute, Ms. Aliakbari was Director of Research, Energy, Ecology and Prosperity with the Frontier Center for Public Policy. She has presented her work at many academic conferences and has been published in the prestigious academic journal Energy Economics. Ms. Aliakbari’s research has been discussed in prominent media outlets including the Wall Street Journal, and her commentaries have appeared in major Canadian and American newspapers such as the Globe and Mail, Washington Times, National Post, and Financial Post.
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Electricity bills in Toronto remain high compared to U.S. cities

Kenneth P. Green

Senior Fellow, Fraser Institute

Ashley Stedman

Elmira Aliakbari

Director, Natural Resource Studies, Fraser Institute

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Electricity bills in Toronto remain high compared to U.S. cities

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Kenneth P. Green

Senior Fellow, Fraser Institute

Ashley Stedman

Elmira Aliakbari

Director, Natural Resource Studies, Fraser Institute

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