Thursday, November 19, 2015
Ontario Ministry of Finance
Ontario Fostering a More Dynamic Business Environment
Bill Proposes Early Elimination of Debt Retirement Charge from all Non-Residential Electricity Bills
Today the Ontario government introduced Bill 144, the Budget Measures Act, 2015.
The bill, if passed, would further the economic plan set forth in the 2015 Budget and demonstrate the government's commitment to creating a dynamic and innovative business environment.
As part of the Budget Measures Act, 2015, the government is proposing to remove the Debt Retirement Charge (DRC) cost as of April 1, 2018 for all non-residential consumers - nine months earlier than previously estimated - and reduce businesses' electricity bills. Ending the DRC on a legislated fixed date would provide certainty to commercial, industrial and other users to help them plan their investments more effectively. As previously announced, the government is removing the DRC cost from residential users' electricity bills as of January 1, 2016, saving a typical residential user about $70 per year.
To further help Ontario businesses succeed and grow, the Budget Measures Act 2015 also proposes to:
- Make amendments to the Liquor Control Act to operationalize the sale of beer in grocery stores
- Simplify rules in the Securities Act on the regulation of takeover bids and issuer bids
- Provide one-time relief to eligible Ontario interactive digital media companies
The bill will also move forward Ontario's infrastructure plan by proposing amendments to the Trillium Trust Act to designate the LCBO head office lands, Ontario Power Generation's head office building, the Lakeview lands, and the province's shares in Hydro One and Hydro One Brampton as qualifying assets. Also under the proposed amendments, net revenue gains from the sale of these assets would be dedicated to the Trillium Trust.
Other proposed changes in the Budget Measures Act, 2015 include improving and streamlining the regulation and promotion of the horse racing industry in Ontario, amendments to the Tobacco Tax Act to strengthen the oversight of raw leaf tobacco and improving the management of corporate land forfeited to the province of Ontario.
Creating a more prosperous economy is part of the government's plan to build Ontario up. The four-part plan includes investing in people's talents and skills, making the largest investment in public infrastructure in Ontario's history, creating a dynamic, innovative environment where business thrives and building a secure retirement savings plan.
Quick Facts:
- The DRC is 0.7 cents per kWh and is paid to the Ontario Electricity Financial Corporation (OEFC) to help service and pay down the legacy debt and other liabilities arising from the investments in electricity infrastructure of the former Ontario Hydro.
- Since the government’s reforms under the Electricity Restructuring Act, 2004, OEFC has reduced its stranded debt for 11 consecutive years by about $12.4 billion, from $20.6 billion to $8.2 billion as of March 31, 2015. The government expects that the stranded debt will continue to decline following the broadening of ownership of Hydro One.
- Eliminating the DRC for transmission-connected large industrials using 3,000 megawatt-hours (MWh) per month would save $21,000 per month or about seven per cent on its electricity bill.
- Removing the DRC for an average transmission-connected large northern industrial electricity consumer in the Northern Industrial Electricity Rate program would save more than eight per cent off its electricity bill.
- Removing the DRC for a small business using 20,000 kWh per month would save $140 per month or about four per cent on its electricity bill.
- Low-income homes may qualify for a reduction on their electricity bills through the Ontario Electricity Support Program (OESP). Beginning in 2016, the OESP will reduce the cost of household electricity by applying a monthly credit directly to qualifying customers’ bills.
Background Information:
Additional Resources:
Quotes:
"This bill, if passed, fulfills commitments made in Ontario’s 2015 Budget. It will further promote initiatives in our economic plan to increase our productivity, stimulate growth of businesses and create jobs for the people of Ontario. As an example, the proposal to remove the Debt Retirement Charge from non-residential electricity bills nine months earlier than estimated provides financial certainty to all Ontario’s businesses."
— Charles Sousa, Minister of Finance
Media Contacts:
Kelsey Ingram
Minister’s Office
416-326-1409
kelsey.ingram@ontario.ca
Scott Blodgett
Ministry of Finance
416-325-0324
scott.blodgett@ontario.ca
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