Businesses and residents who are unable to change when they use the most electricity are likely to see big increases in their hydro costs when smart meter monitoring is in effect.

In Toronto, 80 per cent of customers with active meters are reportedly paying more, a statistic that has caused a lot of alarm and put the provincial government in damage control mode.

At the Mon Ami Pizza Café in downtown Kitchener, the owners are still waiting for their first ‘smart' hydro bill, and like other business-owners they're worried about it.

Dan Kelly of the Canadian Federation of Independent Business says "Many businesses find it hard to shift their load. If you're a pizza restaurant, you can't really cook pizzas in the middle of the night to save electricity costs and I think that sometimes gets forgotten."

Smart meters will benefit those who can choose to use electricity in the evenings and on weekends, not those who must use it during the week, like many seniors.

Julie Girvan handles energy issues for the Consumer's Council of Canada and she says "That's a very significant factor and I think the government should have looked at that. There are seniors that are at home during the day and there's nothing they can do about shifting their load."

That's exactly the problem for retiree Jane Corry. She lives Toronto where time-of-use pricing is already in effect and she says "My hydro bill from August 2009 to August 2010 has gone up $105."

Girvan adds that people may also be shifting their usage and still not seeing any savings as the cost of energy goes up across the board.

"Rates are going up across the province for all sorts of reasons, for aging infrastructure and the government's green energy plan. I mean people need to realize that that is going to bring a lot of cost pressures on people's bills."

On Tuesday, the Ontario government released its $87 billion, 20-year energy plan, which will see hydro rates rise 50 per cent over five years. Recently the HST also pushed bills up.

Nonetheless, the McGuinty government sold smart meters as a way for consumers to save money in an increasingly expensive electricity market.

Ontario Finance Minister Dwight Duncan says time-of-use meters do save people money, and he calls the current increase in costs "a short term phenomena, because they're just putting the meters in. Once that's paid for, then they start to see the savings."

Kitchener Wilmot Hydro President and CEO Jerry Van Ooteghem says it will likely take six or seven years to recover the cost of the investment.

In an attempt to ease the burden on consumers the Ontario government has instituted a 10 per cent discount on energy bills for five years, but it's unclear how helpful that will be. The cost or energy is expected to rise more than four times that amount in the same period.

Coming up in Part Three: Where hydro bills are likely to end up amid all these increases and discounts.