Cost of electricity could go up in Toronto. Here’s why

Residents living in Toronto may see their monthly electricity bill go up over the next five years.

Toronto Hydro, the agency responsible for distributing electricity across the city, filed an application last month to the Ontario Energy Board (OEB) seeking approval to increase distribution rates and other charges as part of its multi-year investment plan.

If approved, residents could see their monthly bill increase on average by about $3.44 annually from 2025 to 2029.

For small businesses, this could mean their bills goes up about $10.20 a month, annually.

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The charges do not impact the actual cost of electricity in Ontario. Rather it applies to a customer’s delivery charge, which pays for power to be transferred to homes and businesses.

The increase, Toronto Hydro argued, is needed to help fix and repair equipment, modernize the grid, and respond to extreme weather and cyber security threats. In total, the agency says these changes will require an investment of about $5.9 billion.

“Our plan will help ensure that our grid and operations will continue to be safe, reliable and environmentally responsible as we power our customers through this decade and beyond,” officials said in a application summary.

According to Toronto Hydro, more than 80 per cent of customers approve the changes.

Electricity providers must apply to the OEB in order to alter distribution rates. Toronto Hydro Spokesperson Daniel McNeil told CTV News Toronto they submit plans every five years through a transparent process that the public can take part in. McNeil noted that in 2020 Toronto Hydro was able to lower the distribution portion of the delivery charge by 17.4 per cent and will hold that rate through to 2024.

A spokesperson for the minister of energy said that demand for electricity is rising and that utilities have to begin preparing for an “electrified future” by investing in infrastructure.

However, the government says it is doing what it can to keep electricity bills low.

As of Nov. 1, the Ontario Electricity Rebate—which can be applied to homes that use less than 50 kilowatts of energy—was increased from 11.7 per cent to 19.3 per cent

“For an average residential customer who uses 700 kilowatt hours (kWh) of electricity per month, this change will increase the annual amount saved on electricity bills by $140, bringing their total savings to more than $300 per year,” Michael Dodsworth said in a statement.

“We will keep rates stable and predictable as Ontario continues to grow and electrify.”