Customers of seven utilities are eligible initially to opt-in to the new program. Remaining utilities will follow in six months

Ontario electricity customers are getting a new rate scheme for their energy use: ultra-low overnight pricing.

Come May 1, customers of Toronto Hydro, London Hydro, Centre Wellington Hydro, Hearst Power, Renfrew Hydro, Wasaga Distribution and Sioux Lookout Hydro will be able to opt-in to the new program.

“[T]he new Ultra-Low Overnight price plan will give families and small businesses who use more electricity overnight more ways to save” said Todd Smith, Ontario’s minister of Energy, in a press statement.

The ultra-low overnight rate may appeal especially to EV owners, most of whom charge at home. The move could also defer the strain EVs may put on the grid by incentivizing off-peak charging.

All utilities in the province must provide the new rate plan within six months, or, by November 2023.

Rate breakdown

Currently, Ontarians are able to choose between two different billing rates: time-of-use (TOU) and tiered. The new optional Ultra-Low Overnight price plan adds a third choice. It provides:

• Ultra-low overnight rate of 2.4 cents per kWh: everyday 11 p.m.-7 a.m.
• Mid-peak rates of 10.2 cents per kWh: weekdays 7 a.m.-4 p.m. and 9 p.m.-11 p.m.
• On-peak rates of 24.0 cents per kWh: weekdays 4 p.m.-9 p.m.
• Weekend off-peak rates of 7.4 cents per kWh: weekends and statutory holidays 7 a.m.-11 p.m.

Already, EV owners see significant annual savings due to not having to pay for gas. The new ultra-low overnight rate may save some customers a further $90 per year, claims the government.

The trade-off for an off-peak rate that is “67 per cent lower than the current off-peak rate,” is a higher on-peak rate at nearly 45 per cent higher than the current TOU peak rate.

By shifting demand to off-peak hours, the government hopes to use up Ontario’s excess clean energy, generated by nuclear, hydro and wind power. The province estimates as much as $5.7 million may be saved per year in capacity costs with enough customers shifting to the ultra-low rate plan.

(Capacity costs are expenditures due to expanding operations and infrastructure upgrades.)

“By making better use of the province’s clean grid, our government is taking further action to keep electricity affordable in Ontario,” said David Piccini, Ontario’s minister of the Environment, Conservation and Parks in a statement.

The Ontario Energy Board offers a free calculator for customers to choose the most cost-effective rate plan for their lifestyle.