Announcement on cuts to Ontario hydro bills coming Thursday

Ontario electricity rate payers will learn Thursday how the Liberal government plans to reduce their bills.

Premier Kathleen Wynne is set to make the announcement in the morning, a day after the Toronto Star reported the plan is to cut consumer costs by another 17 per cent largely by financing the costs of electricity generation contracts over longer periods.

Opposition and energy critics say the move, akin to renegotiating a mortgage, is a "shell game" that will lead to more costs down the road.

The Liberal government faces no bigger political issue at the moment than hydro bills, which have about doubled in the last decade.

• Ontario Liberals eyeing hydro rate cut in the range of 8 per cent: sources

• NDP proposes plan to cut hydro rates by up to 30%

• Ontario Energy Board orders hydro firms to reconnect homes cut off for winter

Last month, CBC News reported the government was considering a plan that would cut rates in the range of eight to 10 per cent, with across-the-board reductions to what's known as the "global adjustment" charge on hydro bills. 

The global adjustment, which accounts for up to 70 per cent of electricity rates, is the charge consumers pay for above-market rates paid to power providers in 20-year contracts meant to ensure a steady supply.

Auditor general Bonnie Lysyk has estimated the global adjustment cost $50 billion between 2006 and 2015 and increased by 1,200 per cent between 2006 and 2013 — meanwhile, the average electricity market price dropped by 46 per cent.

CBC News also reported the government was considering reforms to programs designed to help people struggling with high hydro costs.

The idea is to shift the Ontario Electricity Support Program for low-income customers to the tax base, rather than being
funded by other rate payers.