It appears that seven weeks of COVID-19-related electricity rate relief for residential and small business customers did not adversely undermine Ontario power system revenue. Even after the regulated price plan (RPP) was frozen at the lowest time-of-use (TOU) rate of 8.5 cents per kilowatt-hour (kWh) from January 1 to February 22, electricity prices are set to dip slightly on May 1 when a new six-month rate cycle begins.
“Any variance between forecast and actual costs, whether a surplus or shortfall, is factored into the next price-setting. Prices are going down due to a surplus that has accumulated,” the Ontario Energy Board (OEB) confirms in a release outlining the pending semi-annual RPP adjustment.
Nevertheless, most customers won’t notice because a corresponding decrease in the Ontario Electricity Rebate (OER) will keep costs steady with current levels. The new rate schedule shaves 0.6 cents per kilowatt-hour (kWh) off both peak and mid-peak TOU rates and cuts 0.3 cents/kWh from the off-peak TOU and tiered price options, while reducing the rebate on pre-tax electricity use and transmission/distribution charges by 2.3 per cent.
“The government’s intention is that, for residential and small business customers, the reduction in the electricity price will be offset by the change in the OER,” the OEB advisory states.
As of May 1, TOU rates per kWh will be: 17 cents for peak; 11.3 cents for mid-peak; and 8.2 cents for off-peak periods. Residential customers opting for tiered rates will pay 9.8 cents/kWh for the first 600 kWh of consumption and 11.5 cents/kWh for usage above that threshold. Small business customers on tiered rates will pay 9.8 cents/kWh for the first 750 kWh of consumption. In turn, the electricity rebate will shrink from 21.2 per cent to 18.9 per cent.
RPP customers have not been offered rate relief during the current provincial stay-at-home directive, instigated April 3.