Unmasking the Illusion: Ontario’s Electricity Rebate, Hidden Costs, and the Burden on Everyday Ontarians

In an economic landscape increasingly defined by mounting pressures, many Ontarians—particularly residential landlords, small businesses, and hardworking consumers—have found themselves repeatedly battered by policy decisions originating from the provincial government. What may initially appear as beneficial relief often conceals a far more complex and financially challenging reality, especially concerning our electricity bills.

The intricacies of these policies can be challenging to decipher, often buried under layers of official announcements and opaque billing structures. However, a deeper dive into the numbers reveals a disturbing trend: a significant increase in energy costs despite public assurances and much-touted rebates. This article aims to pull back the curtain on these policies, exposing the true impact on Ontarians.

A Landlord’s Unsettling Discovery: The Illusion of Savings

My personal journey into the labyrinth of Ontario’s electricity costs began with a proactive step to manage expenses and promote energy conservation. On October 1, 2020, I installed individual electricity meters, commonly known as “suite meters,” for each of the 25 rental units within a property I own in Brantford, Ontario. This initiative was part of a larger strategy to empower tenants to manage their own consumption, with 12 of my 25 tenants immediately taking on responsibility for their electricity bills as per our updated lease agreements.

Naturally, I anticipated a substantial decrease in my overall electricity expenses. This expectation was further bolstered by the provincial government’s highly publicized and much-vaunted electricity “rebate,” which promised significant relief for consumers. Yet, when I reviewed my financial statements and compared them year-over-year, the reality hit with the force of an uninsulated wire: my total electricity bill had inexplicably increased. The reaction was visceral – a profound sense of “WTF!”, encapsulating both disbelief at the apparent failure of policy and the sheer waste of financial resources.

Adding to the frustration, Brantford Power had introduced a new billing system approximately a year prior, leading to sporadic and often confusing invoices. There were instances where I received no bill for three months, only to be inundated with three bills in a single month. Initially, I suspected these billing irregularities were the root of my increased costs. This prompted a multi-day, painstaking analysis of every line item. Just “parsing” the complex electricity bill data into my trusty spreadsheet – a tool that often reveals hidden truths – consumed more than eight hours. What I uncovered was far more insidious than a simple billing error.

Unveiling the Deception: Four Compelling Details

My extensive analysis brought four critical details into sharp focus, each one a piece of the puzzle illustrating the true nature of Ontario’s electricity policies.

1. The Quantified Decrease in Consumption: A Pyrrhic Victory

The first detail was a testament to the effectiveness of the suite metering initiative: a significant and quantifiable decrease in electricity consumption. For the period in question, electricity consumption plummeted from 113,241 kilowatt-hours (kWh) in 2019 to 84,356 kWh for the same period in 2020. This represented an impressive 25.5-percent reduction in energy use! To paraphrase Kermit the Frog, this should have been a moment for an enthusiastic “Yaaayyy!”—arms waving in celebration. What makes this achievement even more remarkable is that 2020 was the year of the unprecedented work-from-home phenomenon, a trend that disproportionately drove up home electricity consumption across residential properties everywhere. Despite this societal shift, my property’s consumption dropped significantly.

2. The Paradox of Increased Bills: More for Less

Although I began my investigation knowing my bill was higher, the second detail quantified the extent of this paradox: my total electricity bill had increased by 9.3 percent. This surge occurred despite the dramatic 25.5-percent drop in consumption and the provincial government’s average 30-percent rebate. This finding was a direct contradiction to all logical expectations and government promises. How could consuming less energy, especially with a supposed rebate, result in paying more?

3. Stealthy Rate Hikes: A 55.4% Jump Overnight

The third, and perhaps most alarming, detail was the stealthy and substantial increase in electricity Time-of-Use (TOU) rates, which occurred with virtually no media coverage or public discourse. In September 2019, the off-peak, mid-peak, and on-peak rates stood at 6.5, 9.4, and 13.4 cents per kWh, respectively. Just one month later, in October, these rates inexplicably surged to 10.1, 14.4, and 20.8 cents. This represented a staggering 55.4-percent increase overnight! The escalation didn’t stop there. On November 1, 2020, the rates were further hiked to 10.5, 15.0, and 21.7 cents, with the latter being the highest-ever on-peak rate recorded. These sudden and dramatic increases directly undercut any benefit from reduced consumption or promised rebates, quietly siphoning more money from consumers.

4. The “Rebate” Con: An Ineffective Band-Aid

My fourth detail solidified my perspective on the “con” of this so-called rebate. Throughout the entire analysis period, my property’s off-peak electricity consumption consistently ranged between 61 percent and 65 percent of the total kWh consumed in each billing cycle. While off-peak rates are inherently lower, the actual dollar amount generated by multiplying this high off-peak consumption by its rate was surprisingly close to the dollar amounts accumulated during the mid-peak and on-peak periods. In essence, whether one adopted a TOU plan or a flat rate, the financial difference for consumers, and indeed for the electricity generation and delivery industry, was negligible. This revealed the rebate as an ineffective band-aid, failing to provide meaningful financial relief due to the overall structure of rate increases.

The Chronology of Rate Manipulation: A Timeline of Policies

To understand how we arrived at this perplexing situation, it’s crucial to examine the historical timeline of Ontario’s electricity policies and the government’s interventions. This chronology reveals a pattern of rate increases often immediately followed by “rebates” that, upon closer inspection, appear designed to mask the underlying hikes rather than genuinely reduce costs.

The initial rebate concept emerged when the Wynne government passed the Ontario Rebate for Electricity Consumers Act in 2016. This legislation introduced an 8-percent electricity rebate, displayed as a pre-tax credit at the bottom of most electricity bills, and was originally slated to conclude in 2021.

July 1, 2017: The Ontario Fair Hydro Plan Act was enacted, with the stated goal of lowering electricity prices for consumers.
May 1, 2018, and May 1, 2019: Electricity rates continued to increase, broadly aligned with the rate of inflation.
June 7, 2018: The Ford government secured a majority victory over the Wynne administration.

Following the change in government, the situation surrounding electricity costs began to escalate more dramatically:

Sept./Oct. 2019: The significant rate increases, including the 55.4 percent jump in TOU rates, were implemented, as detailed earlier.
Nov. 1, 2019: In a move that appeared directly responsive to the recent rate hikes, the Ford government introduced the Ontario Electricity Rebate (OER). This rebate, designed to apply a 31.8-percent reduction to the pre-HST amount for eligible residential uses, farms, and many small businesses, seemed to serve the purpose of “hiding” the 55-percent increase enacted just weeks prior. Notably, certain types of multi-unit buildings, such as hospitals, universities, trailer parks, and hotels, were specifically excluded from this rebate.

The COVID-19 pandemic introduced another layer of policy adjustments, often presented as relief, but ultimately contributing to the convoluted and rising cost structure:

March 24, 2020: Amidst considerable fanfare and widespread media coverage, the government announced temporary electricity rate relief for consumers on time-of-use pricing, introducing a flat rate of 10.1 cents/kWh in response to the COVID-19 crisis. This was heralded as a measure to support Ontarians spending more time at home.
June 1, 2020 (just two months later): Quietly, and with far less public attention, the government increased this flat rate to 12.8 cents/kWh.
Nov. 1, 2020 (four months later): The government set the rebate at 33.2 percent. Crucially, on this very same day, it re-introduced the dramatically increased TOU rates mentioned earlier – 10.5, 15.0, and 21.7 cents/kWh. The 21.7 cents/kWh represented the highest-ever on-peak rate. These new TOU rates amounted to a 3.8 percent, 4 percent, and 4.2 percent respective increase over November 2019 rates, effectively masking the combined 60-percent increase over the preceding year with a slightly higher rebate percentage.
Jan. 1, 2021 (two months later): The flat rate was re-introduced at 8.5 cents/kWh. However, the rebate simultaneously dropped significantly to 21.2 percent, a substantial 36-percent decrease from its previous level.
Feb. 1, 2021 (one month later): TOU rates were re-introduced at 8.5, 11.9, and 17.6 cents/kWh.

A particularly concerning discrepancy arose regarding the November 1, 2021, announcement. Details of this specific policy change were mysteriously absent from the Ontario Energy Board’s official historical electricity rates webpage. Despite this omission, the Ontario government’s own website boldly stated, “Starting January 1, 2021, the OER will provide eligible consumers with a 21.2-per-cent rebate from the province on the subtotal of their electricity bill. This means the average residential bill will not go up compared to November 2020.” The emphasis on the last sentence is mine, highlighting the misleading nature of this claim, as my own experience, and likely that of many others, directly contradicted it.

The True Cost of the “Rebate”: Ontario’s Mounting Debt

The fundamental question arising from these “rebates” is: where does the money to fund them originate? The answer points to a much larger, more concerning issue: Ontario’s colossal and ever-growing public debt.

In 2019, Ontario held the dubious distinction of having the largest sub-national debt in the world. To put this into perspective, Ontario’s debt in 2018 exceeded that of entire nations like Austria, Switzerland, Russia, Sweden, Israel, Norway, and 166 other countries. Out of 186 countries ranked globally, Ontario’s debt placed it at No. 20. This is not merely an abstract number; it represents a profound financial burden on every Ontarian.

The trajectory of this debt is alarming. In 1985, Ontario’s net public debt stood at $28.9 billion. By 1990, it had increased to $38.4 billion. A decade later, in 1995, it soared to $101.9 billion. Under the Wynne government in 2014, it reached $287.3 billion, representing an astounding 40 percent net debt-to-Ontario’s entire GDP. The Ontario Financing Authority reports that Ontario’s net debt for 2019 was $353.3 billion and projected it to balloon to $398 billion for 2020. This staggering figure represents 47.1 percent debt-to-GDP, meaning nearly half of Ontario’s total gross domestic product is tied up in debt.

The cost of servicing this debt is immense. The interest payments alone on the 2019 debt amounted to $12.5 billion. This sum constitutes eight percent of Ontario’s total revenue and stands as its fourth-largest spending area. This means a significant portion of the province’s revenue, which could otherwise be invested in essential services like healthcare, education, or infrastructure, is instead diverted to pay interest on past borrowing. The accumulation of this debt is also largely recent: Ontario was formed in 1867, yet 87 percent of its net public debt has been accumulated since 1990, marking a 10.4-fold (1,000 percent) increase in just three decades.

This context reveals the fundamental flaw in the “rebate” system: it is not “free.” The government is not generating savings; it is merely shifting the financial burden. As the saying goes, they are “stealing from Peter to pay Paul” – taking from the collective taxpayer through increased debt to provide a temporary, often illusionary, discount on electricity bills, only to charge more later.

Summary of Analysis: The Hidden Costs Revealed

My investigation into my own property’s electricity bills crystallized the broader issue at play. Despite implementing suite meters that resulted in a substantial 25.5-percent decrease in electricity consumption, I still ended up paying 9.3 percent more than in the previous period. This stark contrast between reduced usage and increased cost serves as a powerful indictment of the current energy policy.

The initial 8-percent electricity rebate introduced by the Wynne (or, depending on your perspective, “loss”) government began this journey. However, the subsequent “rebate” policies under the Ford (or perhaps, “unafFORDable”) government have evolved into what can only be described as a shell game, cleverly draped in smoke and mirrors.

The provincial government initiated a significant 55.4-percent rate increase in September/October 2019, which was then ostensibly “masked” by a 31.8-percent rebate introduced in November 2019.
A year later, in November 2020, the government again increased rates by an average of four percent. This further hike, which brought the combined increase over the past year to approximately 60 percent, was simultaneously obscured by a new 33.2-percent rebate.
Just two months later, the government quietly reduced this rebate to 21.2 percent, representing a substantial 36-percent decrease in the rebate’s value.
This pattern reveals a crucial distinction: the rebate is a legislatively temporary political ploy, designed to create an illusion of relief. The underlying rate increases, however, are fiscally permanent, embedded into the system.
Based on these trends, I predict that Ontario’s electricity rates will inevitably increase by a minimum of 50 percent, and possibly as much as 70 percent, within the next five years. The current path is simply unsustainable.

Epilogue: A Broader Crisis and the Call for Real Solutions

The electricity rebate, in its current form, is a fiscally unsound and ultimately futile endeavor. It is not “free,” it cannot be sustained indefinitely, and it has demonstrably failed in its stated purpose of saving money for Ontarians. As discussed, it represents a classic case of “stealing from Peter to pay Paul,” deferring costs rather than genuinely reducing them.

Why have Ontario politicians continuously engaged in this political game of smoke and mirrors? I suggest it’s a deliberate strategy to distract voting citizens, especially tenants, from asking the truly difficult and fundamental questions about our energy system:

Why is our electricity now so expensive, particularly when Ontario enjoyed some of the lowest electricity costs in the 1960s, making it the envy of most countries worldwide?
Who truly owns the majority of our electricity generation and distribution companies? What are their operational structures and profit margins?
What are the salaries and compensation packages of the executives and senior staff within these energy companies? How “fat” are these corporations? Are they efficiently managed, or are they bloated by excessive costs?
Where are the substantial investments in advanced energy storage solutions and diverse alternative energy generation methods that could stabilize costs and improve grid reliability?
Why has “net metering,” a system that allows consumers to generate their own power and feed excess back into the grid, not been heavily promoted and incentivized to foster energy independence and resilience?

As an investor, I am actively seeking to invest in an energy generation solution for my properties, with the ambition of becoming the primary provider of electricity to my tenants – essentially operating as a licensed substation – while the existing grid serves as my automated backup provider. This desire for independence stems directly from the frustrating and unsustainable costs imposed by the current system.

The crisis of rising energy costs is not an isolated incident. It converges with a confluence of other formidable challenges facing residential landlords and real estate investors in Ontario. In 2020, Canadian insurance companies adopted what can only be described as a brutal war-profiteering strategy, disproportionately targeting real estate investment property owners. I recently chronicled this alarming trend in a separate article, highlighting the organized nature of these insurance premium hikes.

Further compounding these pressures are the three eviction bans imposed within a single year, which significantly impacted landlords’ ability to manage their properties and recover lost income. Add to this the zero rent increase guideline for 2021, which I estimate will cost residential landlords a staggering $2.2 billion in lost equity in just one year. This directly hinders their ability to maintain properties, invest in upgrades, and provide quality housing.

The ongoing injustices within Ontario’s Landlord and Tenant Board (LTB) also paint a grim picture. I, for instance, have an eviction hearing scheduled next month for a tenant who has not paid rent since March 2020 – a full year! The systemic delays and biases within the LTB add immense financial and emotional strain on property owners.

For far too long, media and politicians have universally demonized residential landlords, particularly during the pandemic, perpetuating a narrative of rapid and unfair rent increases. While it is true that rents have increased dramatically in many areas, the reality is far more nuanced. These increases are not solely a result of landlord greed but are a symptom of deep-seated systemic issues: government’s failed housing policies, outrageously unfair tax policies, escalating municipal fees, short-sighted and poorly understood residential tenancy laws, and dare I say, sometimes outright stupid cost-control strategies. All these factors combined have not only contributed to the creation of unaffordable rental and purchase housing markets but have also strangled the life out of the net operating income of investment properties. In plain terms, while nominal rents may have risen, landlord profits have not, and in many cases, there is scant net profit remaining after all expenses.

It is time for genuine reform, transparency, and sustainable policies that benefit all Ontarians, rather than relying on deceptive measures that only serve to conceal a growing financial burden.