Deciphering Your Electricity Bill: What Is the Regulated Price Plan and Is It Really Working for You?
The Regulated Price Plan (RPP) is an electricity rate structure put in place by the Ontario Energy Board in order to give residential and low-volume commercial consumers stability and predictability in their electricity bills. What’s the downside? This rate structure, which was designed in a way to incent the average residential user to shift their usage towards lower priced, off peak times, can work against commercial consumers, who are less likely able to shift their usage to evenings and weekends.
Because commercial consumers need to be open during defined hours to serve their customers, and because they are often unable to shift usage in a meaningful way, these consumers end up paying more for their electricity based on Time of Use (TOU) than they would if they paid spot-market or real-time prices in Ontario. You can find the current TOU rates here.
What are the Time of Use Price Periods?
(Winter = November 1 to April 30; Summer = May 1 to October 31.)
Winter and summer weekdays: 7 p.m. to midnight and midnight to 7 a.m.
Winter and summer weekends and holidays: 24 hours (all day)
Winter weekdays: 11 a.m. to 5 p.m.
Summer weekdays: 7 a.m. to 11 a.m. and 5 p.m. to 7 p.m.
Winter weekdays: 7 a.m. to 11 a.m. and 5 p.m. to 7 p.m.
Summer weekdays: 11 a.m. to 5 p.m.
In addition to TOU pricing, approximately 1 in 10 Ontario electricity customers are still billed according to RPP tiered prices. If you are a tiered price consumer, you can use a certain amount of energy each month at a set, lower price, but when you pass that level, your rate goes up for all additional electricity used. This can make it difficult for budgeting, because as soon as your business passes its threshold, you’re paying a higher amount. You can find the current tiered pricing rates here.
You can pay the Hourly Ontario Energy Price (HOEP), or the market rate for electricity, rate that is separate from time of use and tiered pricing. Market price electricity customers pay the HOEP, plus the Global Adjustment (GA), which accounts for the difference between the market price and the rate paid to generators, and for conservation and demand management programs. Read our blog to learn more about the GA.
Is rate switching for you? If you take a look at our case study here, we analysed a company’s bills, and identified an opportunity for them to reduce their energy costs by 15%, simply by rate switching. They were spending $110,000 per year on time of use electricity at their facilities, and didn’t have the flexibility to shift operations to save on costs. But we identified that by switching to Bruce Power Direct and getting access to wholesale supply, the customer could realize a significant 15% energy cost reduction — and that’s just one of the benefits of working with the market’s largest wholesale supplier.
Many low volume commercial customers in Ontario benefit from rate switching, but it is not a one-size fits all recommendation. Bruce Power Direct will provide an in depth analysis of your historical usage and cost structures to help you determine if you can benefit from switching your rate structure.
Interested in seeing more case studies on how we help companies reduce their energy costs? Download our “6 ways to save on energy costs”.