Quick answer
The Global Adjustment covers the difference between Ontario's hourly market price for electricity and the prices guaranteed to generators under contract, plus the cost of new infrastructure and conservation programs. It grew from $650 million in 2006 to more than $7 billion in 2014.1
Why it exists
Ontario's wholesale electricity price changes hour by hour, but many generators are paid fixed prices under long-term contracts or regulation. The Global Adjustment makes up the difference. It also funds building and maintaining electricity infrastructure and conservation and demand management programs.1
How big it has become
- Ontario's Auditor General reported it rose from $650 million in 2006 to more than $7 billion in 2014.1
- Consumers paid $37 billion from 2006 to 2014, and the Auditor General forecast $133 billion from 2015 to 2032.1
- It became most of the commodity portion of a household electricity bill.1
Households vs. large businesses
For most households the Global Adjustment is part of the regulated price per kWh. Businesses using more than 250,000 kWh a year pay the hourly wholesale price and see the Global Adjustment as a separate charge on their bill, and some of their costs are based on peak demand.21
A legal challenge
A Hamilton manufacturer challenged the charge in court, arguing it was a tax rather than a regulatory charge. The company said its Global Adjustment costs rose from about $207,000 in 2008 to almost $3.4 million in 2016. In December 2019 Ontario's Court of Appeal allowed the case to go ahead to a full hearing.1
What you can do: you can't opt out of the Global Adjustment, but using less electricity overall, and less at peak times, lowers what you pay.
Common follow-up questions
Does the Global Adjustment show on my home's bill?
For most households it's built into the regulated price per kWh rather than listed separately. Larger business customers see it as its own line item.
Why did it grow so much?
It pays for contracted and regulated generation whose prices are above the market price, along with infrastructure and conservation programs, and those costs grew over the years.
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Answers are general information as reported by the sources listed on the date shown, not personal financial or technical advice. Programs, prices and rules change. Canadian Energy Standard is an independent company, not affiliated with any government, utility or program named here.
- Financial Post, Court reinstates constitutional challenge to Ontario's global adjustment charge (December 2019), citing Ontario's Auditor General
- IESO, Large Electricity Consumers: electricity pricing in Ontario (2016)