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The Ford government seems to want to repair Ontario’s electricity market. It recently moved to scrap the Green Energy Act and reportedly plans to eliminate or alter the so-called Fair Hydro Plan.

While these moves will mitigate future price increases, they won’t reduce current electricity prices. In fact, according to a Fraser Institute study being released today, to lower existing prices the government must reduce what’s known as the “Global Adjustment” — an extra charge on electricity. It won’t be easy, but reducing the global adjustment could bring down electricity prices by about 24 per cent.

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This would be welcome news for Ontarians, as electricity prices increased 71 per cent from 2008 to 2016, far outpacing electricity-price growth in other provinces.

To understand how we got here, look no further than the 2009 Green Energy Act and its schedule of subsidized electricity-purchase contracts called feed-in-tariffs. These contracts provide long-term price guarantees of above-market rates to generators of renewable energy (wind, solar, bio-energy and some hydro). To fund these subsidized contracts and other system costs (including expanded conservation programs), Ontario attached an extra charge to electricity prices: the Global Adjustment (GA). Power prices have soared since 2009, not because electricity costs more to generate, but because the GA has risen dramatically.