Electricity plans?

[danmand]

What is the deal with the electricity plans being offered?

I was offered a 5 year fixed rate of 8.89 c/kwh, but it appears that Ontario Energy Board has capped the price at 5 c/kwh for the time being.

The supplier is a bit cheasy, sending me a cheque for $32.00 and saying: "By cashing the cheque, you have read the agreement and ......."

What to do?

 

[danmand]

Any insight and/or advice anybody?

 

[DATYdude]

It's sleazy, not cheesy.

If they are marketing to you, you're going to pay too much. If the government ever makes us pay actual market prices for hydro then these will be a good deal except of course by then they will have jacked their rates.

Same with the gas marketers. When the price of oil goes up they send people out to sign up new customers.

 

[UMustang]

What is the deal with the electricity plans being offered?

I was offered a 5 year fixed rate of 8.89 c/kwh, but it appears that Ontario Energy Board has capped the price at 5 c/kwh for the time being.

The supplier is a bit cheasy, sending me a cheque for $32.00 and saying: "By cashing the cheque, you have read the agreement and ......."

What to do?

Okay, here we go....

With any retailer, they are only selling you the commodity. That is, the contract is for one line on your bill called "Commodity" or "Energy" or something to that effect. The rest of your charges (Delivery, Debt Retirement) are not covered by the contract and you'll get charged these above and beyond the contract price.

Right now, the Ontario Energy Board has set the commodity price at 5.5 cents for the first 1,000 kWh/30 days, and 6.4 cents for every kWh above that (the threshold goes down to 600 kWh in the summer). The prices are subject to change every six months or so and is set such that it represents what the market price of electricity is (well, in theory).

Sounds like a shitty deal?

Keep in mind this. By 2010, the entire province will have "smart" meters, which will allow your hydro company to measure your consumption on an hourly basis. As a result, they'll be able to bill you based on when you consume your electricity, charging higher rates when more people use hydro (on-peak consumption). Right now, I think the idea is to have rates in a 3:2:1 ratio (on-peak, mid peak, off peak), so I think what has been floated is somewhere around 9 cents/6 cents/3 cents. You will also probably have the option of being charged real time prices, which will vary hour by hour. There will also be a concept known as Critical Peak Pricing, which will kick in at times when electricity demand is extremely high, and they'll charge you somewhere around 30-50 cents/kWh.

So, depending on the term of the contract and how you use your hydro, 8.89 cents might not be that bad. If you use most of your hydro at peak times, you might be better off with with the flat rate. Otherwise, you might be wise to not cash the cheque, let the contract lapse, and wait and see what happens.

 

[Keebler Elf]

By 2010, the entire province will have "smart" meters, which will allow your hydro company to measure your consumption on an hourly basis. As a result, they'll be able to bill you based on when you consume your electricity, charging higher rates when more people use hydro (on-peak consumption).

About fucking time. Pay for what you actually use. What a concept.

 

[UMustang]

About fucking time. Pay for what you actually use. What a concept.

Agreed, and this should have been around when the market opened in 2002. But the technology to do this in an efficient manner hasn't been cost effective, either from the consumer point of view or from the utility point of view until recently. Smart meters are only now gaining widespread popularity in the US and Europe. Ontario, oddly enough, is being watched by many jurisdictions in the world, seeing how successful they'll be with these meters and time of use pricing

 

[elmufdvr]

never sign for five years... are you f#cking nuts??? you don't know what the prices will be... i got the same letter... they called about it after i did not respond.. i told them it wasn't good enuff... i would not sign up ... i want a better deal... i got a call back with a better offer... for the same time..i told them i would only sign up for one year at the cheaper rate.... they said they could not do so... so i told the sales person to go ask a manager for me..or not to call back ..... she came back with a better rate than be for ... F- that.. i did not sign up with anyone....they are getting to be like the banks they try to extort customers..and put fear of higher prices... guess what everything goes up.....

 

[Tangwhich]

About fucking time. Pay for what you actually use. What a concept.

They already do charge you for what you use, at a set rate.
The smart meters just change the prices based on the time of day.

 

[UMustang]

Personally, I dont consume much hydro during peak hours.

Businesswise, my consumption is the same on a daily basis and to penalize me by charging me considerably more cuz some fools decided to crank up the a/c during peak times is utterly outrageous. I can see a lot of businesses running into serious problems if they jack the rates up to 50 cents during heavy demand periods.

From what happens in other jurisdictions (like California), the higher rate is a premium for consumption above and beyond your normal usage. The idea is to use the stick approach (as opposed to the carrot) to encourage people to cut back on their consumption. Without going into the gory details of how this is done, if you consistently use the same amount of hydro, you won't get charged the premium. However, if you crank your air conditioner, you will.