Tag: electricity

Time-of-Use Pricing And Your Business’ Electric Bill

Time-of-Use Pricing And Your Business’ Electric Bill

If you’re a small business here in Ontario, odds are that your electricity is charged on a “time of use” basis.

In fact, the Ontario Energy Board (OEB) has been shifting businesses like yours (along with residential customers) to this pricing approach since 2005, and making your usage more easily adjusted and tracked with “smart” meters since 2010.

It’s all part of a $2 billion project by the province to cut electric demand by shifting customers away from the tiered pricing that today is applicable to only about 10 percent of customers.

But, has time-of-use pricing lowered your electric bill or increased your energy savings?

Despite a host of other benefits to time-of-use pricing, the short answer would be…no. In fact, Ontarians’ power costs are more than any other province’s, skyrocketing 82 percent (at peak periods) since 2010, according to a report late last year by CBC News .

Managing your power use more efficiently–and getting better energy savings–starts with understanding time-of-use pricing.

It’s based on the fact that energy is less expensive to produce when there is less of it being used. This leads many industrial customers, which typically use this pricing method throughout Canada, to plan their production schedules around non-peak times.

Ontario’s time-of-use electric pricing changes with the season, with three price periods:

  • Off-peak, or 7 p.m. to 7 a.m. weekdays and around the clock on weekends and holidays.
  • Mid-peak, or between 11 a.m. and 5 p.m. weekdays.
  • On-peak, or 7 to 11 a.m. and 5 to 7 p.m.

When demand is lower, the majority of power is generated by Ontario’s nuclear generators and large hydroelectric stations that run all the time. During peak times, other, higher-cost sources may be turned to when needed, like natural gas-fired plants. Renewable sources, solar and wind, are also tapped into when available.

Compare time-of-use pricing to tiered pricing. That approach allots a certain amount of monthly energy per month. If you exceed that level, your rate goes up.

Sounds like time-of-use is more controllable, right?

Plus, you’re helping the environment by helping cut down on greenhouse gas emissions and helping to ease the pressure on Ontario’s energy grid.

So, why are you paying more despite the promised efficiencies of time-of-use pricing?

A lot of factors have played a role, not the least of which have been well-intended public policy decisions that ultimately led to overcapacity. According to our Auditor-General, we have the capacity to produce 30,203 megawatts of power but only need, on an average day, 15,959. Moreover, according to most assessments, the pricing structure has not provided sufficient incentives for shifted or lowered use.

There may be ways to better manage your power costs and increase your energy savings that you are not aware of. Active Business Services works with businesses of all sizes with both basic and comprehensive energy assessments to understand your business operation, energy requirements, financial objectives and risk appetite.

There may be more incentives than you know of to make time-of-use pricing pay off. Or, you may be in a position to better manage your electricity costs through a different purchasing strategy – like market price or block products – that help you mitigate your risk. It doesn’t hurt to ask. And you might well save some money in the process.

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Active Business Services: A Brief History of electricity in Ontario

Active Business Services: A Brief History of electricity in Ontario

When we flick on the lights or plug our digital devices into their chargers, few of us think about the electricity we are using or where it’s coming from. That’s in part because electricity is so much a part of our daily life that we sometimes fail to even notice it, until there is a failure or outage.

In 2003, when much of North America’s eastern seaboard went dark due to a widespread electricity outage, residents in Ontario and 8 U.S. states were quickly reminded of the importance of electricity. The outage, which lasted a day in some areas and weeks in more remote areas, affected more than 50 million residents on both sides of the Canadian-U.S. border.

After an investigation, the outage was linked to laxed or non-existent regulations, overloaded transmission lines, overworked generating stations and poorly manicured trees in Ohio, which culminated in the perfect storm rippling across neighbouring states and Ontario.

During the early hours of the outage, U.S. officials were attributing the blackout to Canada, despite Ontario being the only jurisdiction with an implemented standards guideline.

“Ontario already had enforceable standards – with utilities or power agencies liable to fines if they didn’t make the grade. But in 2003, Ontario was the only jurisdiction in North America that did,” Bruce Campbell, chief executive of Independent Electricity Systems Operators said at the time.

The August 14th outage showcased how intricate and delicate our electricity grid is, while also highlighting how susceptible an overburdened system is to outages.

In the thirteen years since the Blackout of 2003, Ontario has come a long way in the distribution of energy and particularly electricity.

Last year, Ontario became the only Canadian province to completely eliminate coal from its energy grid, which put added pressure on energy sources that are less harmful to the environment.

Because a large amount of Ontario’s electricity is generated by the water power of Niagara Falls, electricity in Canada’s largest province has always been abundantly cleaner than provinces that rely on coal-burning electricity generation plants.

In the early 1900’s, hydroelectricity was introduced to the power grid as other energy sources, like wood, began to dwindle. The immense power generated by Niagara Falls provides enough energy to not only power much of Ontario, it also powers several U.S. states.

Hydroelectricity offers a clean, renewable energy source that creates no harmful emissions or dangerous byproducts.

In the century since hydroelectricity was first integrated into Ontario’s power grid, millions of residents and business owners have benefited from the clean energy water power produces. There has also been the addition of other renewable energy sources, like wind, natural gas and solar.

With so much choice, it can often be hard for business owners to decide which energy source is best for them. Active Business Services, a Burlington, Ontario energy management firm, was established a decade ago to assist commercial and industrial businesses in choosing the right energy package for their business.

Utilizing a comprehensive assessment process, Active Business Services works with business owners to assess risk level, energy consumption and demand, future use and a host of other issues to build a customized energy plan that benefits every business client.

As innovators around the world continue to look for green energy sources, Ontarians can rest assured that their province is committed to providing them clean energy in various forms.