Ontario's Liberal government is telling the province's citizens to expect residential electricity prices to rise by about 46 per cent over the next five years even as it introduced a 10 per cent rebate program.

The "Clean Energy Benefit" will give Ontarians a rebate of 10 per cent on their bills over that five-year period, Finance Minister Dwight Duncan told the legislature Thursday in introducing the government's fall economic update.

He put the cost of the program at $1.1 billion. The program will begin on Jan. 1.

"This will help families, it will help hard-working small business owners, and it will make a very big difference for Ontario farms," Duncan said.

The Liberal government has come under fire for rising electricity bills.

In the update, the government blamed neglect of the province's electricity system by previous governments (the NDP ruled from 1990 to 1995, and the Progressive Conservatives from 1995 to 2003). It noted a deregulation experiment in 2002 saw prices to shoot up, following by a price freeze at an artificially low level.

Premier Dalton McGuinty's government said it has been investing in replacing coal-fired generation -- which contribute to air pollution and increase global warming -- with cleaner forms of electricity, such as solar and wind power.

"Shutting down all coal generation is equivalent to taking seven million cars off the road," the government claimed. This is to happen by 2014.

It attributed 56 per cent of the coming rise in residential hydro rates to clean energy generation, with the remainder to pay for upgrading the existing generation, transmission and distribution systems.

"Ontario families and businesses are now paying the true cost of electricity. Rising electricity prices are having a significant impact on consumers, who are asking for help with the cost of clean, modern energy," the government said.

Duncan added in the legislature: "If people tell you they can deliver clean, reliable electricity at a lower price, don't believe them."

In other news, Duncan said the government has signed a $1-billion deal to extend its contract with Teranet, the company that operates the provincial electronic land registry, for 50 years.

That $1 billion will be used to reduce the province's $220-billion debt, he said.

Ontario will be moving to have the provincial securities commission regulate the derivatives market, which is worth an estimated $12 billion. Derivatives are complex investment instruments whose value is linked to future price movements, making them highly speculative.

Duncan highlighted what the government saw as good news:

  • 75 per cent of jobs lost during the recession, which began in October 2008 and ended in July 2009, have been recovered
  • real GDP growth for 2010 is estimated to be 3.2 per cent
  • the deficit should come in at $18.7 billion, which is $1 billion less than predicted in the spring budget.

The update is coming about 11 months before the 2011 provincial election.

Ontario Progressive Conservative Leader Tim Hudak said Ontarians are paying more and getting less in return.

"And what is the premier's response? More costly energy experiments, more taxes like the HST, a bloated bureaucracy and more McGuinty government waste," he said.

The Clean Energy Benefit gives back "a few mere drops in the bucket," Hudak said, adding the benefit will soon be erased by other increases.

Hudak accused the McGuinty Liberals of being responsible for the biggest tax increases and the largest debt increases in the province's history.

Revenues went up by 0.67 per cent and expenses decreased by 0.2 per cent, according to the update.

Hudak claimed 41,000 private sector jobs have disappeared since the GST was introduced.

According to Statistics Canada, there were 19,200 fewer jobs in Ontario in October than there were in July.

NDP Leader Andrea Horwath criticized the Teranet deal.

"It looks like another fire sale of an opportunity to have long-term revenues for the province being paid off in a short-term amount. It's another 407 type of deal," she said.

Horwath was referring to the sale of the toll highway by then-Tory premier Mike Harris before the 1999 provincial election.

With a report from CTV Toronto's Paul Bliss and files from The Canadian Press