Time for Ontario to widen peak/off-leak rate gap in TOU pricing
Results from a pilot project in Oklahoma show that having a wider TOU price gap will encourage more peak-period conservation and shifting of electricity use, a finding that contrasts with the experience in Ontario, where the price gap and the market signal it sends is very weak. In the Oklahoma trial, pricing ranged from 4.2 cents (U.S.) for off-peak times and up to 46 cents for critical peaks, compared to a range of 5.1 to 9.9 cents at an Ontario utility such as Toronto Hydro.
Some participants in the Oklahoma pilot achieved a 57 per cent reduction in energy use during peak periods compared to a control group, while the average reduction was 33 per cent during highest-price periods. Widening the TOU price range in Ontario is crucial to realizing the benefits of smart meters and to enabling competitive services from third-party retailers, including storage services.
Tags: Oklahoma, smart meters, time-of-use, Toronto Hydro
Tyler Hamilton is associate publisher and editor-in-chief of Corporate Knights magazine and former business columnist for the Toronto Star. This blog is a personal project started in April 2005.
February 16th, 2011 at 12:16 pm
End prices in Oklahoma are about what residential customers in Toronto pay on their bills for everything other than the 5.1-9.9 cent/kWh. Apples to apples, the comparable rates for Oklahoma’s TOU pilot and Ontario’s TOU rate are 4.2- 46 and 14.1- 18.9.
At a rate of 0 cents/kWh our off-peak charges would be double the off-peak rates in this study.
February 17th, 2011 at 4:45 pm
I find Tyler Hamilton columns is be on the money , In this case the over riding facts are we do not pay for the true cost of energy. The money has to come from higher taxes for everyone in the end , or the make the end users pay .
You only need to look at the price of gas in the UK as one of many examples to see here in Canada and USA , we have been living in a bubble for many years .
My perspective is of the reality I see as a former CEO for many years , CEA , and the sole owner of Hydro Edison.
The time is now to invest in conservation before Catch-22