Remember a recent Green Ideas about Peak Power, explaining the breakfast and suppertime peak loads our electric power grid experiences every day? If so, you might also remember that peak power is really expensive for utilities to supply, because they have to buy power from neighbouring grids at the same time everyone else wants it, and/or fire up every generator they have, including their dirtiest and most expensive ones, to meet those peaks.
Then outside of peaks, utilities have surplus power and can supply power very cheaply. But when power rates are the same 24/7, we end users don’t have any incentive to change our habits to reduce those costly and dirty peaks.
Well, here’s a policy that can help consumers save money, help ease grid peaks and help lower emissions: time of day power rates (also call time of use rates).
Under time of day rates, the price we consumers pay for power would reflect the actual cost to the utility of supplying that power: expensive during peaks; moderate during the middle of the day; and cheap overnight, when power is plentiful.
- The advantage to a utility: all customers would have an incentive to shift loads out of peaks into cheaper times of day.
- The advantage to customers: savings, by shifting some power usage out of peak periods into cheap periods.
Time of day rates are already in place in several provinces:
- In BC, power costs 12.6 cents/kilowatt-hour (KWH) during the day, but five cents more during the supper peak and five cents less overnight (or 40% off the daytime rate)
- In Ontario, power costs 15.7 cents/KWH during the day, but 20.3 cents during the breakfast and supper peaks, and 9.8 cents (or 38% off the daytime rate) overnight, holidays and weekends
- Also in Ontario, a second ‘ultralow overnight’ option: power costs 15.7 cents/KWH during the day and a steep 39.1 cents during the breakfast and supper peaks – but then just 3.9 cents overnight (or 75% off the daytime rate)
Each of the above gives consumers an incentive to shift loads out of peaks into cheap power times of day. The easiest loads to shift? Laundry; dishwashing; showers; some heat; and the best one of all, EV charging. Imagine being able to fill up your EV overnight in Ontario at 75% off the daily rate!!! Know any gas stations that offer such a discount?
Quebec’s winter rates are centered around cold snaps rather than daily peaks. But they too offer consumers a great incentive to reduce consumption during cold weather peaks.
Time of day rates are only possible in jurisdictions with smart power meters, which can record not just how much power is used but when it is used. With smart meters now installed across NB, it’s likely we’ll be seeing time of day rates within the next few years. They’ll be opt-in, not mandatory – but who wouldn’t want to save on their power bills while helping ease pressure on our grid?
In the meantime, we can all start thinking about the loads we can shift, so we’ll be ready for savings when time of day rates arrive!