FAO releases report on home energy spending in Ontario

The Financial Accountability Office of Ontario (FAO) released a report that examines how home energy spending differs across household income levels and regions in Ontario.
According to the report,  the average Ontario household spent $2,128 on home energy to heat and cool their homes and power their appliances in 2019. On average, households with higher incomes spent more on home energy. Households in the highest income quintile (earning more than $151,063) spent an average of $3,070 on home energy, while households in the lowest income quintile (earning less than $36,070) spent an average of $1,050.

The FAO states that home energy spending across household income groups “is significantly affected by provincial programs that subsidize the cost of electricity.” The organization says that in 2019, the Province spent $3.5 billion through five programs to reduce electricity bills for Ontario households, which lowered annual household electricity bills by an average of $609. 

Households in the highest income quintile received the highest average electricity subsidy at $706 per household, while households in the second lowest income quintile (earning between $36,071 and $68,884) received the lowest average subsidy at $537 per household, according to the report.

“In general, as a household’s average income decreased, the average electricity subsidy provided by the Province decreased, largely due to the design of the Ontario Electricity Rebate, which provides benefits to all households that scale with the amount of their electricity bill,” says the FAO.

Households in the more rural Eastern ($2,338), Northern ($2,245), and Western ($2,192) regions of the province had the highest home energy costs in 2019. Households in rural areas of Ontario spend more on home energy due to less access to natural gas, which is the most cost-effective energy source for home heating, and the higher cost of distributing energy to rural areas. Households in the more urban Greater Toronto Area ($2,010) and Hamilton-Niagara ($2,118) regions spent the least on home energy in 2019. 

The FAO estimates that households in the Northern region received the highest average provincial subsidies in 2019, at $995 per household, while households in the Greater Toronto Area (GTA) region received the lowest average benefits, at $467 per household.

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