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Report says high electricity costs hurting Ontario business

By Paul Morden, Sarnia Observer

Little Caesars franchise owner Kathleen Mundy says Ontario’s rising electricity costs have caused her to cut staffing levels at her five pizza shops in Southwestern Ontario.

Mundy joined members of the Sarnia Lambton Chamber of Commerce Wednesday morning, at an event held at her Lambton Mall Road shop in Sarnia, to highlight a provincial Chamber report, Empowering Ontario, urging the province to take steps to curb rising electricity costs.

“No pun intended, but there’s only so many pieces in a pie,” Mundy said.

With annual electricity costs of more than $50,000 for her five pizza shops, Mundy said she has had to cut back on the number of employees, raise prices for the first time in five years, and have her managers spend part of their day managing electricity use.

Pointing to the door of the shop, Mundy said, “That open sign is becoming more difficult each and every day.”

Rory Ring, president of the Sarnia-Lambton chamber, said commercial-industrial electricity rates in Ontario have climbed 16 per cent since 2013, and are projected to increase another 13 per cent over the coming five years.

Electricity costs faced by businesses may soon, in come cases, be higher than rent, he said.

A provincial chamber survey found one in 20 businesses in Ontario expect to close their doors in the next five years due to rising electricity costs.

Among steps the report calls for are increased transparency in electricity pricing, keeping the debt retirement charge on residential bills until all the debt is paid back, encouraging more consolidation of local electricity distribution companies and making better use of smart meter data.

Rob Taylor, chairperson of the Sarnia-Lambton chamber, said the business group has been hearing concerns about electricity costs from many of its members, and it raised the issue with Ontario Premier Kathleen Wynne when she recently visited the community.

Mundy, who has had her business for 12 years, said the percentage of its costs eaten up by the electricity bill has continued to grow over the years.

Each of her pizza shops have warming cabinets, ovens, walk-in coolers and other equipment that use a large amount of electricity.

Managers in the shops spend a large part of their day monitoring when equipment should be turned on and off, to save electricity, Mundy said.

That additional work, plus the fact the shops can’t afford to hire as many workers, increases stress, she said.

“People are trying to dance faster just to make up for what we have to spend in other areas.”

Mundy said high electricity costs are making Ontario less competitive, pointing out that a Little Caesars franchise owner in Winnipeg spends one-third of what she does on electricity.

“That allows him to hire three more people, provide jobs for three more families, or, in fact, help four or five university students prepare for the fall semester,” she said.

“I can’t do that.”

Mundy added she’s often approached by individuals looking to open Little Caesars franchises.

“Very few of them, once they look at our financial statements and the cost of doing business, will probably decide to locate in Ontario,” she said.

“We have to put our resources where it really matters, and that’s job creation and growing our business,” Mundy added.

“Hopefully, this report will help us do that.”

paul.morden@sunmedia.ca

Rob Taylor, chairperson of the Sarnia Lambton Chamber of Commerce, left, and Little Ceasars franchise owner Kathleen Mundy talk on Wednesday July 8, 2015 in Sarnia, Ont., at an event marking the release of a provincial chamber of commerce report on higher electricity costs. (Paul Morden/Sarnia Observer/Postmedia Network)

Rob Taylor, chairperson of the Sarnia Lambton Chamber of Commerce, left, and Little Ceasars franchise owner Kathleen Mundy talk on Wednesday July 8, 2015 in Sarnia, Ont., at an event marking the release of a provincial chamber of commerce report on higher electricity costs. (Paul Morden/Sarnia Observer/Postmedia Network)

 

http://www.theobserver.ca/2015/07/08/report-says-high-electricity-costs-hurting-ontario-business

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