Why Global Adjustment Turned Negative in January 2026 — and What It Means for Customers

January 2026 delivered one of the most unusual outcomes Ontario electricity consumers have seen in over a decade: a negative Global Adjustment (GA). Notably, the last time GA went negative was April 2014.

To understand why it happened, and why GA has remained low through February, it helps to revisit how the mechanism works.

The Structural Rule: GA Is Inversely Linked to Market Prices

Under Ontario’s market framework administered by the Independent Electricity System Operator (IESO), GA recovers the difference between wholesale electricity market revenues and the contracted or regulated costs of generation, conservation, and reliability programs.

The key principle: When wholesale electricity prices rise, GA falls.

January’s prolonged cold intensified this dynamic. Natural gas demand surged across North America, tightening supply and elevating fuel prices. As gas-fired generation frequently sets the marginal electricity price, wholesale electricity prices spiked accordingly. As the IESO confirmed, elevated market prices meant several regulated and contracted generators earned higher-than-expected revenues in the market. Because GA reconciles total contract payments against market revenues, those excess earnings were returned through settlement.

The outcome: GA turned negative in January 2026.

What This Means for Class A Industrial and Manufacturing Customers

For most Class A facilities, GA represents the largest component of total electricity cost. When GA declines sharply — or turns negative — it can materially offset increases in the energy commodity portion of the bill. Because these two elements are structurally linked through Ontario’s market design, they often move in opposite directions. In this case, the GA reduction largely offset the higher energy price, keeping overall supply costs comparatively flat on a blended basis. While month-to-month volatility was visible in the breakdown, the combined impact was more moderated than commodity pricing alone would suggest.