Otis Singleton
Toronto has some of the highest electricity prices in North America, with an average monthly bill of $178.08 (pre-tax). However, the city also has some of the lowest electricity prices in North America due to its access to hydroelectric power. The Ontario Energy Board (OEB) offers different electricity price plans to help residents manage their electricity costs, including Time-of-Use (TOU) pricing, which charges different rates based on the time of day and day of the week. TOU rates are typically lowest from 7 pm to 7 am every day and all day on weekends and holidays. Ultra-Low Overnight (ULO) pricing is another option, which also offers ultra-low rates during overnight periods.
| Characteristics | Values |
|---|---|
| Time of cheaper electricity | Off-peak, mid-peak, and weekends and holidays |
| Cheaper electricity time period | 7 pm to 7 am every day |
| Cheaper electricity during summer and winter | Yes |
| Cheaper electricity during summer | May 1 to October 31 |
| Cheaper electricity during winter | November 1 to April 30 |
| Cheaper electricity during off-peak hours | Evenings and weekends |
| Cheaper electricity plan | Ultra-Low Overnight (ULO) pricing |
| Cheaper electricity for | Households and small businesses |
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What You'll Learn
Time-of-Use (TOU) pricing
In Toronto, electricity prices are determined by the day of the week and the time of day it is used. This is called Time-of-Use (TOU) pricing. The Ontario Energy Board (OEB) introduced TOU pricing in 2013 to reduce the cost of energy consumed by residents. The pricing is adjusted twice a year, on November 1 and May 1, and the amount charged is based on off-peak, mid-peak, and on-peak hours. The electricity used from 7 pm to 7 am every day and all day on weekends and holidays is charged at the lowest TOU price throughout the year.
TOU pricing gives customers the option to shift high electricity-usage activities, such as laundry or running the dishwasher, to off-peak periods, which are charged at a lower rate. This helps customers manage their electricity costs. TOU pricing is beneficial to residents as it allows them to pay less for electricity during off-peak hours when the demand for energy consumption is lower.
Most residential and small business customers in Toronto have a smart meter and pay TOU rates for electricity. TOU rates are fixed electricity prices charged to all Regulated Price Plan (RPR) customers, both residential and small business (electricity demand less than 50 kW). Customers on the Ultra-Low Overnight (ULO) price plan are not affected by the TOU pricing changes and continue to enjoy electricity rates.
In addition to TOU pricing, Toronto Hydro offers tiered pricing and Ultra-Low Overnight pricing. Tiered pricing is based on two thresholds of electricity consumption, while Ultra-Low Overnight pricing is based on the day of the week and time of day electricity is used, with an ultra-low overnight rate that encourages high electricity-usage activities to be shifted to lower-demand periods overnight. Customers can choose the electricity price plan that best suits their needs and change their price plan at any time.
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Ultra-Low Overnight (ULO) pricing
Toronto Hydro offers three electricity price plan options to its customers: Time-of-Use (TOU) pricing, Ultra-Low Overnight (ULO) pricing, and Tiered pricing.
The Ultra-Low Overnight (ULO) pricing plan is based on the day of the week and the time of day electricity is used. It offers an ultra-low overnight rate that encourages shifting high electricity-usage activities to lower-demand periods overnight. The ULO plan is beneficial for those who can perform electricity-intensive tasks during the evening, on weekends, or overnight. This includes tasks such as laundry, running the dishwasher, or charging an electric vehicle.
The ULO plan is not affected by the summer Time-of-Use (TOU) hours and Tier thresholds implemented by the Ontario Energy Board (OEB) on May 1. Electricity rates for customers on the ULO plan remain unchanged.
The OEB introduced a new ULO price plan for Regulated Price Plan (RPP) customers on May 1, 2023. The ULO rates cover the cost of electricity purchased on behalf of Toronto Hydro, which is then collected from customers without any mark-up and paid directly to suppliers.
The ULO plan is similar to the TOU plan, which offers off-peak pricing during certain periods. The lowest TOU price is available all year round from 7 pm to 7 am every day, as well as all day on weekends and holidays. This allows customers to manage their electricity costs by shifting usage to lower-price periods.
The ULO plan is also comparable to tiered pricing, which is based on two thresholds of electricity consumption. Tiered rates are not regulated by the OEB and are determined by the contract between the customer and their energy provider.
Toronto Hydro allows customers to choose their electricity price plan based on their usage patterns and preferences. The ULO plan may be suitable for those who can take advantage of the ultra-low overnight rates by adjusting their electricity usage accordingly.
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Tiered pricing
Toronto Hydro offers three price plan options to its customers: Time-of-Use (TOU) pricing, Ultra-Low Overnight (ULO) pricing, and Tiered pricing. While the first two are based on the day of the week and time of day electricity is used, Tiered pricing is based on two thresholds of electricity consumption.
Under Tiered pricing, customers are billed based on their electricity consumption, which falls into two categories or tiers. The more electricity you consume, the higher the rate you pay. The tiers are not based on a fixed amount of kilowatts but rather on two thresholds of electricity consumption.
While TOU pricing is beneficial to Ontarians as it allows residents to pay less for electricity during off-peak hours, Tiered pricing gives customers the flexibility to choose a plan that best suits their electricity consumption patterns.
It is important to note that electricity rates in Toronto are not the same throughout the year. Energy prices are adjusted twice a year, on November 1 and May 1, and the amount you pay is determined by off-peak, mid-peak, and on-peak hours.
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Energy prices are adjusted twice a year
Energy prices in Toronto are adjusted twice a year, on May 1 and November 1. These adjustments take into account the varying costs of energy production and distribution throughout the year. The time-of-use (TOU) pricing model, implemented by the Ontario Energy Board (OEB), divides the day into off-peak, mid-peak, and on-peak hours, with different rates for each period. The TOU pricing is beneficial as it allows residents to pay less for electricity during off-peak hours, such as evenings and weekends, when the demand for energy is lower.
The TOU rates are applicable to both residential and small business customers, with electricity demand below 50 kW. These customers can take advantage of lower rates during the off-peak period, which is from 7 pm to 7 am every day, as well as all day on weekends and holidays. By shifting high electricity-usage activities to these off-peak periods, customers can effectively manage their electricity costs.
In addition to the TOU pricing, Toronto Hydro also offers an Ultra-Low Overnight (ULO) price plan. This plan is based on the day of the week and time of day, offering an ultra-low rate during the night to encourage customers to use electricity during periods of lower demand. The ULO plan is particularly attractive to those with electric vehicles that need to be charged overnight or those with flexible schedules who can perform energy-intensive tasks like laundry or running the dishwasher outside of peak hours.
It is worth noting that the OEB does not regulate tiered pricing. Under this pricing model, the rates are determined by the contract between the customer and their energy provider. Additionally, customers have the option to purchase electricity from another company by entering a contract with a licensed electricity retailer, allowing them to lock in a fixed electricity price for a set number of years. However, this fixed price is not regulated by the OEB.
Energy prices in Toronto are part of a broader effort to reduce the cost of energy consumption for residents. The OEB introduced smart meters in 2013 to facilitate the TOU pricing and provide residents with more control over their energy costs. By understanding the pricing plans available and strategically managing energy usage, Toronto residents can make informed choices to optimize their energy expenses.
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Toronto ranked highest for electricity prices in 2016
Toronto has some of the highest electricity prices in Canada, and this has been the case for some time. In 2016, Toronto ranked third out of 16 major cities for its electricity prices, with only New York and Boston being more expensive. This was a significant increase from 2010, when electricity costs for small industrial users in Toronto were 85% lower than in New York. By 2016, that differential had shrunk to 51%.
The high electricity prices in Toronto are due in part to the Ontario government's aggressive promotion of renewable energy sources, such as solar and wind power. The province's long-term contracts with renewable energy generators have been poorly structured, placing ever-increasing costs on consumers. In addition, the phase-out of coal-fired electricity has also contributed to higher electricity prices.
Toronto residents have a variety of price plans available to them to help manage their electricity costs. These include Time-of-Use (TOU) pricing, which charges different rates depending on the time of day and day of the week, and Ultra-Low Overnight (ULO) pricing, which encourages shifting high electricity usage activities to lower-demand periods overnight. There is also a Tiered pricing option, which is based on two thresholds of electricity consumption.
Toronto Hydro, the city's electricity provider, collects the cost of electricity from consumers and pays it directly to its suppliers without marking up the price. However, they do charge a Transmission Charge to cover the cost of transmitting electricity from generators to the city, which can impact the overall cost of electricity for residents.
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Frequently asked questions
The different types of electricity price plans in Toronto are Time-of-Use (TOU) pricing, Ultra-Low Overnight (ULO) pricing, and Tiered pricing.
Time-of-Use (TOU) pricing is based on the day of the week and time of day electricity is used. TOU rates are the fixed electricity prices charged to all Regulated Price Plan customers, both residential and small business.
Off-peak hours in Toronto are from 7 pm to 7 am every day, and all day on weekends and holidays.
Ultra-Low Overnight (ULO) pricing is based on the day of the week and time of day electricity is used, but with an ultra-low overnight rate that encourages shifting high electricity-usage activities to lower-demand periods overnight.
You can change your electricity price plan in Toronto by submitting a Customer Choice Request Form or by calling Toronto Hydro at 416-542-8000 for assistance.
