Ontario to offer super cheap electricity, but there’s a catch

Ontarians will be able to switch to a new “ultralow” overnight electricity rate of just 2.4 cents per kilowatt hour, a saving of 67 per cent.

Thestar.com
April 12, 2023
Rob Ferguson

Ontarians can switch to a new “ultralow” overnight electricity rate of just 2.4 cents per kilowatt hour, a saving of 67 per cent. But there’s a catch.

Customers joining the plan will pay 59 per cent more for power at dinnertime and in the evening.

Energy Minister Todd Smith announced the new pricing plan option Tuesday, saying it’s perfect for people who work evening shifts or charge electric vehicles while they sleep in the wee hours when demand for power is minimal.

“The ultralow overnight price plan could put up to $90 back in the pockets of these customers over the course of a year,” Smith said at a news conference with Toronto Hydro chief executive Anthony Haines.

“We are increasing resiliency to prepare for electric vehicles.”

The new rate plan -- which defines overnights as 11 p.m. to 7 a.m. -- becomes available May 1 in Toronto, London and several other areas, and across the province in November.

Officials said the savings for those opting in to the plan will depend on household patterns.

“I encourage customers to explore their price-plan options and make an informed decision on the plan that best suits their needs and lifestyles -- particularly for those who own an EV and plan to charge their cars overnight at home,” said Ted Wigdor of the Electricity Distributors Association.

Ontarians can use the Ontario Energy Board’s online “bill calculator” to help determine their best bet.

Instead of paying the 7.4 cent per kWh overnight rate under the current “time-of-use” pricing plan, the ultralow plan would charge a 2.4 cent rate. The tradeoff, however, is paying 24 cents per kWh on weekdays from 4 p.m. to 9 p.m. -- up from 15.1 cents under time-of-use pricing plans.

That’s when many families are busy making dinner, relaxing in front of the television or doing homework around the kitchen table. But someone who works an evening shift could find the plan advantageous, as could customers on electric heat.

“For people who have an electric vehicle, or who have some other big overnight demand, it’s probably going to mean some savings and is a small step toward using surplus energy in the system,” said New Democrat MPP Peter Tabuns (Toronto-Danforth), his party’s energy critic.

Smith touted the potential for increased overnight usage as a bonus, saying it would alleviate pressures on the hydro grid at peak hours during the day and use electricity that in the past has been sold to neighbouring jurisdictions at a loss.

Haines said an incentive for Toronto Hydro customers to wait until 11 p.m. to plug in their EVs would be welcome relief for the power grid, particularly on hot and sticky summer days when air conditioners are running full tilt and putting maximum strain on the system.

“It takes pressure off our grid,” he added. “A large size electric vehicle, when it plugs in at the end of a work day looks to the grid almost like another house being added.”

Tabuns and Green Leader Mike Schreiner said the government could take more pressure off the grid by investing more heavily in conservation programs.