THUNDER BAY – Northwestern Ontario municipal leaders are hoping the province will back their proposal for regional electricity pricing.
The Northwestern Ontario Municipal Association is calling on the Progressive Conservative government to explore a model that would set regional electricity rates for different areas of the province, which could lead to lower prices in the region.
The Independent Electricity System Operator earlier this year reviewed how the province structures wholesale electricity rates, which included consideration for regional pricing.
The NOMA board recently endorsed the proposal for regional pricing made by the Common Voice Northwest Energy Task Force.
With the majority of Northwestern Ontario’s electricity supplied by hydroelectric power that is less expensive to produce than other means of generation, zonal pricing could lead to lower costs than the province-wide blended rate.
“We generate a lot of electricity here and we have an abundance of it,” said NOMA president Wendy Landry, who is also the mayor of Shuniah.
“The blended rate that is across the province doesn’t necessarily prove to benefit us in the Northwest where that generation is happening. We think if the regional pricing is respectful to where that hydro is coming from that it would benefit this area.”
Support for regional pricing includes stipulations such as hydroelectric power being priced at cost plus a reasonable return on shareholders’ equity, the regional price being based on blending the rate for all generation, future demand not driving up the blended zone rate and that residential and small business customers must directly benefit.
While the Common Voice Northwest report found that there could be reductions of as much as 20 per cent on electrical bills, regional leaders see zone pricing as an economic development opportunity.
Landry pointed to higher construction costs and gas prices as two strikes already counting against Northwestern Ontario’s ability to attract new business and industry.
Particularly for a region that Landry acknowledged is trying to stay alive and sustain communities, a lower electricity price could help improve competitiveness.
“We believe we can give something that would offer industries an attractive reason to come to this part of the province and bring their industry, bring their work and bring their economic developers here,” Landry said. “We know that translates into jobs for our young people and keeping people in the north.”
Marathon mayor Rick Dumas, who is also president of the Thunder Bay District Municipal League, said it’s a topic that’s been discussed for many years.
“The reality is that we want to be able to attract the people from southern Ontario, the business from southern Ontario to come to the north and set up business,” Dumas said. “If we can have a lower cost of energy in the northwest, we’ll attract those businesses which will then attract residents.
More job opportunities will also help communities retain their youth, Dumas said, adding that once young adults leave, the prospects of their future children growing up in their former hometown is gone.
“We won’t have the outmigration. That’s a big killer for us,” Dumas said. “When our youth finish school – whether it’s college or university – and they migrate south to where the jobs are. Then we lose them and we don’t get them back. When we lose the youth, then they don’t come back.”
Dumas is optimistic the proposal will resonate with Premier Doug Ford.
"When I hear from Premier Ford that we're open for business, I think he reflects as well that Northern Ontario is open for business," Dumas said, adding that Energy Minister Greg Rickford is from the region.
