OFA wants to see debt retirement charge removed from Ontario farm bills too

Thursday, April 24, 2014

by SUSAN MANN

Ontario farms must continue paying the debt retirement charge on their hydro bills until 2018 just like business and industrial hydro users, even though the Ontario government is nixing the fee from residential bills effective Jan. 1, 2016.

Mark Wales, Ontario Federation of Agriculture president, says if there is only one meter on the farm, and it also applied to the farm residence, “then the debt retirement charge gets removed.” But if a farmer has other meters on their operation, such as for a grain dryer or a poultry barn or a greenhouse, the debt retirement charge stays on the bills covering usage for those meters and continues until the end of 2018.

“This is the unfairness of it,” he says. “We’re saying it (the debt retirement charge) should be off farms too.”

Ontario Energy Minister Bob Chiarelli announced April 23 the government is eliminating the debt retirement charge for residential users. At the same time it’s removing that fee, the government is also ending the Ontario Clean Energy Benefit, which takes 10 per cent off hydro bills.

The government says in an April 23 press release, the debt retirement charge has been on electricity bills since May 1, 2002. The money has been used to pay down the debt and liabilities of the old Ontario Hydro after it was broken into smaller entities.

Wales says the federation has been pushing for some time for a farm and industrial rate for hydro, which would have been a much better solution. “We were suggesting a lower rate but I don’t think they’ve settled on a number.”

The government’s debt retirement charge announcement “is good for the farm house but it’s not good for the farm,” he says.

In an April 25 press release, Wales says energy costs are one of the greatest expenses for farmers.

The Ontario government doesn’t appear to realize the problem the electricity system is causing farmers and the province’s food system, he adds in the release. Ontario’s rising hydro rates are increasing farmers’ costs of doing business and putting them at a competitive disadvantage compared to growers in other provinces, the United States and internationally. BF