Randall Denley: Ontario can’t afford to keep helping pay for everyone’s hydro bill

Ontario Premier Doug Ford during question period at Queen's Park in Toronto, Ontario on Tuesday, October 27, 2026. Photo by Peter Power

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There are two things you can count on when Premier Doug Ford’s government updates Ontarians on the state of the province’s finances. First, the deficit will be higher than what was projected just months before, and second, the date when the budget will be balanced will be pushed back, again.

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Finance Minister Peter Bethlenfalvy delivered exactly as expected in his fall fiscal update Thursday.  He says the deficit will be up this year and next, and the elusive budget balance will be delayed.

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Given the government’s deteriorating financial position, one would have hoped to see some rational action on its ridiculously expensive power-bill subsidies, which cost $6.9 billion last year. Instead, baby steps were taken.

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Bethlenfalvy announced Thursday that the government would cap its biggest single subsidy, the Ontario Energy Rebate (OER), at 1,200 kilowatt-hours monthly for residential users. Given that the average residential consumer uses 700 kilowatt-hours per month, that’s a modest step indeed.

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The change at least limits the size of the energy rebate for those who have the biggest houses and use the most power. Since the energy rebate is paid as a percentage of the bill, people who consume a lot of power get more help every month than those who conserve. That doesn’t make sense.

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The Ford government has also quietly made one additional change to the power-bill subsidy that might be beneficial if it proves to be the start of a trend.

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The government has cut the power-rate subsidy from 23.5 per cent of the bill this year to a still substantial 15.7 per cent next year, but optimism might be premature.

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A year ago, the Ford government sharply increased the power subsidy rate, boosting it from 13.1 per cent because power rates had just jumped 29 per cent due to higher nuclear costs. Rather than trying to sell that challenge to the public, the government doubled up on the subsidy.

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This year, the provincial government got a break. Power rates over the next 12 months are expected to be lower. It’s a temporary downturn in prices, but the government took advantage of the moment to cut the OER, keeping consumer bills stable.

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The question is, what happens next? So far, the government has no apparent strategy on power-rate subsidies, other than to take the most politically expedient course in the short term.

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Energy Minister Stephen Lecce said during a discussion of his department’s estimates earlier this year that he wants to “bell-curve” the subsidy, but it’s not a battle he has won yet.

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The subsidies are nothing more than an ill-conceived effort to shield consumers from the real cost of power by using tax dollars to subsidize their bills. In effect, the government is “saving” people money by taking less money from one pocket and more from the other.