ONTARIO ELECTRICITY: PRIVATE GENERATORS TO BE OVERPAID BY GOVERNMENT
Liberal government will overpay for electricity to make up for impact of politically-motivated electricity price caps of 2002-03.

April 13, 2005 - Oshawa Ontario

At Page A10 of today's Globe and Mail, Karen Howlett refers to her discussion with Society of Energy Professionals president, Andrew Muller:

"To get the gas companies to build plants in the province, the government has agreed to offer them a high price for electricity, said Andrew Muller, president of the Society of Energy Professionals. He is expecting the guaranteed contracts to include prices of about 10 cents a kilowatt-hour, more than three times what it costs to produce electricity from the province's coal-fired plants."

"As I have maintained since before the imposition of the Eves-McGuinty 4.3 cent price cap", says Freedom Party of Ontario leader, Paul McKeever, "price controls do not control prices in the long run: they inflate prices in the long run."

"Keep in mind that, the free market rate for electricity is typically in the 5 to 6 cent per kW range. The ten cent price is now necessary BECAUSE the 4.3 cent price cap scared off investors (and because, McGuinty replaced that cap with two caps - 4.7 cents and 5.5 cents - on November 25, 2003; see Freedom Party of Ontario's press release of that day).

"Having shaken investor confidence with their politically-motivated, economically disastrous price cap decisions, they are now making investment in Ontario power generation too lucrative good to pass-up. Generators will be soaked in more profits than they ever could have made in Ontario had Eves and then McGuinty not assaulted supply and demand, and investor confidence with price controls. I'm feeling ripped off, and all Ontarians should feel the same. These guys are paying, with Ontario taxpayers' money, for their past choices to put their parties' fortunes before sound economics."

This media release has been sent to all major print, radio, and television media.

For further information, contact Freedom Party of Ontario's leader, Paul McKeever:

Office: 905-721-9772
e-mail