Yeah, that is pretty funny. Energy conservation efforts make less sense in an industry like hydro-power, where costs remain more or less the same regardless of minor fluctuations in use. At least with fuel-burning power plants, reduced demand directly results in reduced cost, since a major cost is the fuels themselves. I'm guessing the policy was set up specifically to address the brown-outs that Toronto experiences during high-demand seasons but it still seems really short-sighted. I'd agree, I'd be pissed if I was a TO resident. Especially if I was someone who didn't bother reducing power last year, and now has to pay more because of all my tree-hugging hippie neighbours.
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