Ontario Power Generation Proposes Rate Increase Amid Nuclear Refurbishment Plans
Ontario Power Generation has proposed a significant rate increase to nearly $207 per megawatt hour starting in 2027, as the province invests $47.7 billion in nuclear refurbishments and small modular reactors to meet rising electricity demand. The government is also considering partial privatization of OPG to mitigate financial risks for taxpayers and leverage future profits, while addressing the projected 65% growth in the electricity sector by 2050. However, the move carries substantial financial risks, particularly in light of past costly overruns in similar projects.
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Ontario is investing $47.7 billion in nuclear refurbishments and small modular reactors, primarily through Ontario Power Generation (OPG), to meet rising electricity demand. OPG has requested payments of nearly $207 per megawatt hour for electricity starting in 2027, more than double the 2025 rate.
The province is considering partial privatization of OPG to shift financial risks away from taxpayers and capture immediate value from future profits, estimated at $50 billion. The electricity sector is projected to grow by 65% by 2050, emphasizing the need for efficient infrastructure development.
Privatization could also facilitate economic reconciliation with Indigenous populations by providing them equity opportunities. However, building new nuclear facilities carries significant financial risks, as demonstrated by costly overruns in other projects. Selling OPG may stabilize costs while promoting nuclear energy development.
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