Emergency Recovery Rate Period Q&A

Q) What is being done to support households and businesses with increased electricity usage during this COVID-19 outbreak?

Starting June 1, 2020, the government of Ontario has introduced a “COVID-19 Recovery Rate” of 12.8 cents per kilowatt hour for Time-of-Use Regulated Price Plan (RPP) customers to provide stability and predictability for families, small businesses and farms. This rate is equal to the forecasted average RPP supply cost, calculated by the Ontario Energy Board last October, for the twelve months starting November 1, 2019.

On your Niagara Peninsula Energy Inc. bill presentment, the COVID-19 Recovery Rate will display as:

On Peak – Recovery
Mid Peak – Recovery
Off Peak – Recovery

Customers will be able to see when they are using electricity with all time periods set to the COVID-19 Recovery Rate of 12.8 cents per kilowatt hour for Time of Use Regulated Price Plan (RPP) customers.

Q) Customers are no longer paying off-peak prices of 10.1 cents per kilowatt hour?

No, customers will now be paying a fixed average price of 12.8 cents per kilowatt hour around the clock, 24 hours a day, 7 days a week.

Q) How long will this be in effect?

This pricing is expected to be in effect until October 31, 2020.

Q) That’s a big price increase on June 1. Won’t that create hardship if people have not gone back to work yet?

Compared to having peak/mid-peak/off-peak rates, the 12.8 cents per kilowatt hour rate would better reflect ongoing adjustments to Ontarians’ working arrangements.

A price that doesn’t vary by time of day is a simple way to enhance predictability for residential, small business and farm customers about their costs at a time when their electricity use might be a lot different than it is normally. This rate provides stability for Ontarians who are working and learning from home over the warm summer months.

The implementation of a fixed price in all hours means your bill will be a function of how much power you use in a month, and not a function of when you use that power.

However, the bill impact of the 12.8 cents per kilowatt hour price relative to the Time-of-Use prices that were set on November 1, 2019 does depend on how much power you use during each of the on-peak, mid-peak and off-peak hours.

For customers whose consumption matches the historical average consumption pattern for RPP Time-of-Use consumers – meaning that 64% of their consumption occurs during off-peak hours, 18% during mid-peak hours and 18% during on-peak hours – there will be little to no bill impact from the adoption of the 12.8 cents per kilowatt hour price compared to a bill based on the Time-of-Use prices that were set on November 1, 2019.

For customers who tend to use more power in on-peak and mid-peak hours than the historical average consumption pattern for RPP Time-of-Use consumers, the 12.8 cents per kilowatt hour price will mean a decrease in their electricity costs compared to a bill based on the Time-of-Use prices that were set on November 1, 2019.

For customers who tend to use less power in on-peak and mid-peak hours than the historical average consumption pattern for RPP Time-of-Use consumers, the 12.8 cents per kilowatt hour price will mean an increase in their electricity costs compared to a bill based on the TOU prices that were set on November 1, 2019.

Q) Will the new COVID-19 Recovery Rate be automatically applied to customer bills?

Yes, the fixed ‘COVID-19 Recovery Rate’ of 12.8 cents per kilowatt hour will automatically be applied to all customers who pay Time-of-Use rates starting on June 1, 2020 consumption.

Q) How will this change affect RPP customers who don’t pay Time-of-Use rates?

Tiered customers will not be affected by the new fixed price. The initial rate reduction was targeted to Time-of-Use ratepayers, as those were the customers that would see the greatest increase in cost due to being home during the day.

Q) What are the Time-of-Use Periods in effect during the COVID-19 Recovery Rate period?

The Winter Time-of-Use periods remain in place, as announced by the OEB on April 14, 2020. Tiered prices as set for November 1, 2019 and the winter tier threshold of 1,000 kilowatt hours for residential customers remain in place.

Q) Will we have a choice between Time-of-Use Pricing and Tiered Pricing?

The Government of Ontario is proposing that starting November 1, 2020, customers will be able to choose a plan that best suits their household and lifestyle with the option of either TOU electricity rates or tiered pricing, which will provide a set rate for electricity up to a certain level of consumption.

Q) What is the difference between Time-of-Use Pricing and Tiered Pricing?

TOU rates vary according to when electricity is used. They are cheapest when demand is lowest: during the evenings, on weekends and on holidays.

The TOU pricing periods are:

• Off-peak, when demand for electricity is typically lowest. Ontario households and small businesses typically use the majority of their electricity – nearly two thirds of it – during off-peak hours.
• Mid-peak, when demand for electricity is moderate. These periods are during the daytime, but not the busiest times of day.
• On-peak, when demand is generally highest. These are the busiest times of day – generally when people are cooking, starting up their computers and running heaters or air conditioners.

One of the purposes of TOU pricing is to give customers a financial incentive to reduce their electricity use during peak times. This helps to smooth out demand peaks and lowers overall system costs by reducing the need for more generation capacity.

A small percentage of customers (less than 5 per cent) are charged tiered prices. Tiered price customer either don’t have a smart electricity meter that can track the time of day electricity is used, or live in certain areas that do not have the communications infrastructure to electronically transmit consumption data.

Tiered prices are the same regardless of time of day but become more expensive if a customer’s overall electricity use goes above a set threshold. The current threshold for residential customers is 1000 kWh per month following a decision by the Ontario Energy Board.

Q) How can I stay up to date with what NPEI is doing?

Any new updates or information that NPEI becomes aware of will up updated on our website at www.npei.ca, shared as news releases and posted on Twitter and Facebook.

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