FAQs about Time-of-Use (TOU)

Frequently Asked Questions

Have a question that's not listed here? Visit the Ministry of Energy for more information.

TOU rates refer to electricity prices, which vary based on when electricity is used. That includes by time of day, by day of week (weekdays versus weekend) and by season (winter or summer).

TOU rates better reflect the way the electricity market works. Prices rise and fall over the course of the day and tend to drop overnight and on weekends based on the amount of supply available and our levels of demand.

Effective November 1, 2011, the Ontario Energy Board's TOU pricing includes:

Three different electricity rates:

• Highest price (On-Peak) – refers to when demand is highest
• Mid price (Mid-Peak) – refers to when demand is moderate
• Lowest price (Off-Peak) – refers to when demand is lowest

Summer Rates (May 1 to Oct 31) In the summer, on-peak prices apply during the middle of the weekday (from 11 a.m. to 5 p.m.), reflecting the increase in the air conditioning use.	Winter Rates (Nov 1 to Apr 30) In the winter, on-peak prices apply in the morning (7 a.m. to 11 a.m.) and evening (5 p.m. to 7 p.m.), when demand ramps up as residential electricity use increases.	Weekends and Holidays (All year) All hours of the day are off-peak.

With the ability to measure when electricity is used, different prices can apply at different times of the day. With TOU rates, you'll have a new way to manage your electricity use and your bills, and shifting some electricity to times of the day when rates are lower will save you money.

At the request of the Minister of Energy and Infrastructure, the Ontario Energy Board (OEB) developed an electricity price plan to provide stable and predictable electricity pricing, which ensures the price consumers pay for electricity better reflects the actual cost of producing the electricity.

Electricity prices charged per "kilowatt-hour" change throughout the day, like long distance telephone rates, to better reflect the changes in the costs to produce electricity at different times of the day.

One of the OEB's goals through TOU pricing is to provide an incentive for you to shift some of your consumption away from periods of high total consumption (called "on-peak") to periods of low demand (called "off-peak"). By doing that, you can save money on your bill.

Shifting electricity use will mean the higher cost electricity generators will be needed less. Some of those higher cost generators also create more air pollution, so relying on them less can also help benefit the environment. In the long run, lower peak demand will mean the province needs to build less new generation to serve that peak, lowering costs for all Ontarians.

Some, but not all, of Veridian's customers are already paying TOU prices. Veridian will notify you in advance prior to moving to you over to the new TOU pricing structure.

Utilities across Ontario are at different stages of installing smart meters. By June 2011, an estimated 3.6 million (out of approximately 4.3 million total) Ontario electricity consumers will be on the TOU rates.

Not automatically. What TOU rates do is provide you with a new way to think about and manage electricity costs. Under TOU, there will be different rates for the electricity you use during the on-peak, mid-peak and off-peak hours. So, it will make sense to aim, for example, to schedule energy-intensive activities to the off-peaks (after 7 p.m. during the weekday, and on weekends and holidays).

That will depend, in part, on you. Once you are billed on a TOU basis, depending how and when you use electricity, you may pay a bit more or less or see very little difference. With smart meters, those who work to conserve and shift their usage to off-peak, weekends or holidays may benefit the most. Currently those customers see no price advantage no matter what time of the day they use power.

TOU prices have not been designed to penalize those customers who, for various reasons may have difficulty shifting consumption or are using a very small amount of power.

Testing and piloting under TOU pricing to date has shown that for most customers, if they do not change their behaviour, then they will pay about the same price for electricity that they did under the current tiered pricing model.

This is due in part to the fact that there are over 3 times as many off-peak hours (93) as there are on-peak (30) in a given week. In other words, for every hour that your fridge is running on-peak, there are three off-peak hours when you're paying significantly less than the current tiered rates.

In this way, TOU prices tend to off-set one another so that customers are not penalized by this rate but are still given incentives to shift some of their peak consumption if they are able.

TOU rates better reflect what it actually costs to provide electricity at various times of the day, so to the extent that you can shift some electricity usage to off-peak times, you'll save. Many businesses can also reduce their electricity bill through conservation and improved energy efficiency.

Time of use rates better reflect what it actually costs to provide electricity at various times of the day, so to the extent that you can shift some electricity usage to off-peak times, you'll save. Many farms can also reduce their electricity bill through conservation and improved energy efficiency.

The Ontario Energy Board (OEB) is aware there are circumstances where you may find it difficult to shift your consumption patterns. Since provincial legislation requires Ontarians pay the true cost of the electricity we consume, the OEB designed TOU electricity prices to meet government requirements.

You can sign a contract to switch to an electricity retailer. Most contracts, which are not regulated by the Ontario Energy Board (OEB), currently offer a fixed electricity price all day. If you're considering a contract, there are some things you should consider before signing. Visit the OEB's website for more information.

It's true that, at first, you'll need to be more aware of how and when you use energy, but over time, it will simply become a habit. Smart metering will give you better information and a tool to help you make informed decisions about your electrical usage. Once you review this information on the internet through the TOU portal, you'll be able to develop the best strategies for you.