Electricity costs threat to food processing

For immediate release: Jan. 18, 2017


QUEEN’S PARK – Canada’s leading retailer of packaged meats is also feeling the heat from Ontario’s high electricity prices.

Today, Rory McAlpine, senior vice-president government and media relations of Maple Leaf Foods, testified before the Standing Committee on Finance and Economic Affairs. Maple Leaf, headquartered in Toronto, markets under the Maple Leaf, Shopsy’s, and Schneiders labels. The company employs about 5,100 people across Canada, and exports to 20 countries.

Over all of its Ontario plants, Maple Leaf’s electricity bill increased by 18 per cent to $19.7 million last year.

Given the increase in electricity costs, the company went through the exercise of calculating its potential electricity costs if it were to move to other jurisdictions. The potential savings ranged from $7.5 million to $12.8 million per year. The results of this survey were as follows:

“This is material and it’s before cap and trade comes in this year,” McAlpine told the committee.

He also explained part of the challenge is the company’s electricity bills are unpredictable because of the global adjustment charge.

In addition to operating several plants and having its corporate headquarters in Ontario, Maple Leaf Foods also purchases millions of dollars of Ontario farm product.

“The fact Maple Leaf Foods has gone through the exercise of calculating the savings on electricity in other provinces should be a warning to all elected representatives,” said Barrett, a member of the Finance Committee, and Opposition Critic to the Minister of Agriculture, Food and Rural Affairs. “Companies of this magnitude don’t go through these exercises without good reason.”

During the hearings, Barrett asked what could be done to help the company. McAlpine answered simplifying the system would help, adding, “We have to do that with an eye to competitive consequences.”

“Industrial electricity is something all concerned should take seriously,” Barrett said. “Ontario business and industry continue to face a crisis in electricity and other energy costs. It is incumbent on employers, workers and government to all work together to turn around this threat to our economy.”



For more information, contact MPP Toby Barrett at 519-428-0446 or toby.barrett@pc.ola.org