The provincial government is unveiling a plan to give hydro rebates to low-income households.

Ontario Energy Minister Bob Chiarelli will announce the initiative Thursday morning in Toronto.

Ineligible households will see their bills rise slightly – less than one dollar a month – to fund the program.

Sources close to the program say there will be a sliding scale of rebates, depending on household income and family size, CBC's Mike Crawley reports.

For example, a family of four with a household income of $28,000 could have $38 per month knocked off their bill.

Debt retirement charge axed

The initiative is a follow-up to a promise made last April that the Liberal government would bring in such a plan. The changes will go into effect Jan. 1, 2016, along with the removal of the so-called "debt retirement charge."

For a decade, Ontario Hydro consumers have been paying off billions of dollars in long-leftover debt from the old Ontario Hydro utility. Next January, those payments will stop – an amount that averages $6 per month.

However, that does not mean your hydro bill will drop, as the Ontario Clean Energy Rebate expires at the end of this year. That rebate has been reducing all residential hydro bills by 10 per cent for the past five years.

On average, that has axed about $15 a month from everyone's bill.

Once all the planned hydro bill additions and subtractions are calculated, the typical Ontario household will end up paying around $120 a year more for hydro in 2016 than in 2015.