Ontario nearly doubles household electricity rebates to cover surging hydro prices

Ontario Nearly Doubles Household Electricity Rebates

Electricity prices in Ontario have surged by nearly 30%, but most residents may not have noticed due to a substantial increase in the Ontario Electricity Rebate.

Impact of the Rebate Increase

The Ontario Electricity Rebate now covers nearly 25% of consumer electricity costs.
Despite the nearly 30% rise in electricity prices, the net effect on residential bills remains minimal.
The expanded rebate will cost taxpayers around an additional $2 billion annually, adding to the existing $6.5 billion the province spends to subsidize power costs.

Fiscal and Political Implications

The increasing subsidies have become the largest component of Ontario's provincial deficit, which is forecasted at $14.6 billion this year.

“That’s money coming out of the provincial budget, which otherwise would have gone to deficit reduction, schools and hospitals, and instead is going to effectively socialize the cost of these increases in electricity costs.” – Mark Winfield, political science professor at York University.

Winfield also explained that the government avoids directly passing electricity cost increases to consumers due to the political repercussions, referencing hydro prices as a key issue in the 2018 election campaign.

“The political cost of making people pay for these increases would be unacceptable. So, instead, they hide these costs.”

Summary

Ontario’s increased electricity rebates shield consumers from high price hikes but significantly strain the provincial budget by redirecting funds away from essential services and deficit reduction.

The Star — 2025-11-06