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Throne Speech Acknowledges the Problem of High Cost Electricity

Published by Marie Morden on September 12, 2016

MISSISSAUGA (September 12, 2016) - In response to Canadian Manufacturers & Exporters' (CME) advocacy efforts, today's Throne Speech acknowledged that Ontario's electricity rates are too high," said Ian Howcroft, Vice President of CME Ontario. "Solutions that will provide rate relief for manufacturers has been a top priority for CME." We are pleased to see that the government has committed to lowering the threshold for the Industrial Conservation Initiative (ICI). It will be critical to adapt the program so that the opportunity can be maximized by SMEs without diluting the benefit for larger users. Details and implementation will be crucial to the success of this positive announcement and we look forward to working with the government. Addressing Ontario's electricity rate issues is critical to our competitiveness as a manufacturing jurisdiction.

While there have been notable efforts to reduce electricity rates for manufacturers, many have borne the full brunt of high electricity rates with little or no relief. Many are considering moves or expansion in other jurisdictions where rates are considerably lower. The impact of further loss of manufacturing capacity would force significant upward pressure on residential rates. What is really needed is dramatically lower rates for manufacturers that will promote economic growth. People need better jobs with better wages to help pay for higher electricity rates at home. That's the bottom line. If done right, expanding the ICI can help significantly.

We were also pleased to see the commitment to eliminate the HST for small business. It will be critical that this apply at least up to the size of consumer that would be eligible for ICI to avoid creating a serious policy gap.

This is an important step forward, however, more needs to be done. CME continues to advocate for measures to reduce electricity rates for manufacturers including:

  • Eliminate the Debt Retirement Charge for Manufacturers for manufacturers immediately (scheduled for April 2018);
  • Extend the Northern Electricity Rate Incentive to all manufacturers;
  • Provide surplus capacity to manufacturers at dramatically lower rates to encourage load retention and growth;
  • Provide a load factor credit to manufacturers to recognize the benefits of predictability that manufacturers contribute to the system; and,
  • A program targeted to small and medium-sized manufacturers that are below 3 MW of average monthly peak demand.

About CME
Since 1871, Canadian Manufacturers & Exporters have made a difference for Canada's manufacturing and exporting communities. Fighting for their future. Saving them money. Helping them grow. The association directly represents more than 2,500 leading companies nationwide. More than 85 per cent of CME's members are small and medium-sized enterprises. CME's membership network accounts for an estimated 82 per cent of total manufacturing production and 90 per cent of Canada's exports.

For more information, contact:
Ian Howcroft
Vice President, CME Ontario


Found in: Manufacturing Competitiveness

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