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Zapped: The High Cost of Ontario's Renewable Electricity Subsidies

Benjamin Dachis () and Jan Carr
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Jan Carr: Ontario Power Authority (retired)

No 117, e-briefs from C.D. Howe Institute

Abstract: Ontario’s Green Energy and Green Economy Act subsidizes producers of renewable electricity by paying them far more for their output than the prevailing market price of electricity. Wind power receives a fixed electricity price of 13.5 cents per kilowatt-hour, and solar receives even larger amounts. This subsidy will result in additional costs to the average Ontario household of $310 per year; ostensibly designed to reduce emissions and create jobs, Ontario’s renewable electricity subsidy is an expensive way of meeting these goals. The drag of unnecessarily high electricity costs on the Ontario economy could be reduced if the province did not award any further subsidized contracts to renewable electricity generators.

Keywords: Economic Growth and Innovation; renewable energy; Province of Ontario; Canada; Feed-In-Tariff (FIT) program; energy subsidies (search for similar items in EconPapers)
JEL-codes: K10 K20 L10 L20 (search for similar items in EconPapers)
Pages: 5 pages
Date: 2011-05
New Economics Papers: this item is included in nep-env and nep-law
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Published on the C.D. Howe Institute website, May 2011

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