Among the many things one might want to do in the privacy of one’s own home late at night, checking out electricity prices may not be high on the list.Yet oddly enough, this appears to be one of the main selling features of the Harris government’s plan to deregulate the Ontario electricity market next year.Once electricity is deregulated, the price of a kilowatt of energy will change by the minute, with prices posted on the Internet every hour. Really keen consumers who don’t want to wait a whole agonizing hour can have meters installed right in their homes. So, for instance, if the price per kilowatt hour hits rock bottom at 4:36 a.m., these well-equipped folk won’t have to wait until the top of the hour to shove the laundry into the washing machine, turn on the dishwasher and get out the vacuum cleaner.This is all part of what deregulation enthusiasts like John Grant – an economist who has been involved in the provincial deregulation plans – see as the “empowerment” consumers will enjoy under deregulation.Well, I certainly wouldn’t want to underestimate the pleasure of being able to select the perfect time to maximize one’s electricity consumption – but will it be enough to compensate for the higher prices that will almost certainly accompany this deregulation?We know deregulation produced dramatically higher electricity prices in Alberta and California. In Alberta, prices rose to five times previous levels last winter; in California, power costs surged at times to levels 5,000 per cent above normal.Supporters of deregulation prefer to look at what has happened elsewhere. Michael Trebilcock, a University of Toronto law professor and long-time pusher of electricity deregulation, points to deregulation in Australia and the United Kingdom (U.K.), where, he says, electricity prices fell by 10 per cent to 15 per cent.Maybe I’m missing something here, but it sounds like what we’re faced with is a best-case scenario under which deregulation saves us possibly 10 per cent to 15 per cent off our power bills. (Wow.) The worst-case scenario, however, involves us paying amounts that are potentially staggering. If we do things as badly as California, we could see increases from time to time in the 5,000 per cent range. Vacuuming could become not only an exclusively late-night pleasure, but a luxury we can only dream of.Don’t the odds seem to be stacked against us on this one? It seems a bit like agreeing to a coin toss – Heads, you win ten cents; tails, you lose $50. But let’s go for it!And in case it sounds like I’m distorting things, it should be noted that this is essentially the picture presented by advocates of deregulation. Trebilcock, for instance, doesn’t argue that the savings will be big, only that there may be some savings, as there were in Australia and the U.K.In a recent presentation to the Institute for Policy Analysis in Toronto, Trebilcock acknowledged that the “adverse experiences” in jurisdictions like California and Alberta made him “nervous.” But, in any event, he wasn’t sure it was possible, at this stage in Ontario, to put the genie back in the bottle. How’s that for a ringing endorsement from one of deregulation’s leading proponents?Meanwhile, Myron Gordon, a professor of finance at U of T’s Rotman School of Management, argues that the Ontario deregulation will be a “complete disaster,” not just for consumers, but also for the Canadian business community. Gordon insists that surging, unpredictable electricity costs will strip Ontario industries of the competitive advantage they’ve long enjoyed over their counterparts in neighbouring American states.Gordon scoffs at the notion that there might be price savings. He notes that, once our electricity is deregulated, it will be subject to the rules of the North American Free Trade Agreement (NAFTA). Under NAFTA, we can’t withhold energy supplies from U.S. customers, or charge them more than we charge ourselves, so electricity shortages in the United States will push our prices here up to U.S. levels. Better do the vacuuming now.What makes all this infuriating is that Gordon insists that if we just left things as they are – with a regulated price in a regulated market – we could keep our prices below those of the United States, while covering the full cost of generating the electricity we need, and having some supply left over for profitable export. This is pretty much what British Columbia has opted to do.It’s not surprising, then, that deregulation aficionados are pushing things other than price savings to get the public excited about this bold venture into the new economy.John Grant likes to emphasize the huge array of consumer choice that lies ahead. Consumers will be able to choose electricity packages that also include long-distance telephone and Internet service; they’ll be free to choose between “Standard Supply” (where the wholesale price of energy will be passed through to them and they may be entitled to a rebate) or, instead, opt for whatever deal is offered by their distributor. Or they can choose to deal directly with a retailer who offers fixed prices for a year or more, or another who will install a meter in their home so they can track minute-by-minute price fluctuations.Not that life will be problem-free in this consumer nirvana. Grant poses the question: “If consumers sign up to a retailer’s fixed price offer and sign away their right to [a possible] rebate, do they know what they have given up?” Clearly, lots to talk about around the water cooler or over a cold beer after work.It’s hard to imagine what people did late at night before there was a new economy.

Linda McQuaig

Journalist and best-selling author Linda McQuaig has developed a reputation for challenging the establishment. As a reporter for The Globe and Mail, she won a National Newspaper Award in 1989...